Can a company with a director's loan file dormant accounts?

By Ben Davies · Updated 26 September 2026

Director's loans are one of the most common reasons a company that feels dormant actually isn't. Whether a director's loan breaks dormant status depends on whether anything about it changed in the year, not on the balance sitting on the books.

The test that matters

A company is dormant only if it has had no significant accounting transactions during the period. A director's loan account (DLA) records money lent between the director and the company. The question is whether anything about it changed this year:

• No change at all. The loan balance is unchanged from last year-end — no new lending, no repayments, no interest added, nothing written off. There's no transaction in the period, so the company can stay dormant and file dormant accounts. Those accounts still show the loan: the balance sits on the balance sheet, unchanged from last year.
• Something changed. The director lent the company money, the company repaid some, interest was added to the loan (whether or not anyone paid it), or some of it was written off. Each of those is a significant accounting transaction, so the company is not dormant for that period.

The classic trap is paying a company bill "to keep things ticking over." If the company reimburses you, or records the cost as money it owes you, that goes through the books and breaks dormancy — even though nobody would call the company active.

The confirmation statement fee is a special case. Section 1169 of the Companies Act 2006 disregards it, along with a change-of-name fee, a re-registration fee and the penalty for filing accounts late, so the company can pay any of those from its own account and stay dormant. If you pay one personally and don't want the money back, it needn't go in the company's books. If the company pays you back, that repayment goes to you, not to Companies House, so it may not be covered. For any other cost, the company stays dormant only if the cost was never the company's — a service in your own name, say.

What you file if the loan breaks dormancy

If something changed and the company is no longer dormant, you don't necessarily need an accountant. A company that isn't trading but has a transaction or two — a director's loan movement, a loan being repaid — files FRS 105 micro-entity accounts instead of dormant ones: a short balance sheet showing the loan, with no tax to pay on the CT600 if the only activity was the loan (lending or repaying money isn't income, so it creates no taxable profit).

This is the same situation as a company repaying a Bounce Back Loan, and DormantFile handles it the same way — you choose micro-entity at filing time and enter the loan figures.

When you do need an accountant

Director's loans get more complicated when there's a tax angle:

• An overdrawn DLA (the company has lent the director money) that's still outstanding nine months and one day after the year end can trigger a section 455 tax charge on the company. That's a real tax liability and a CT600 that isn't nil — speak to an accountant.
• Interest charged on the loan, beneficial-loan benefit-in-kind issues, or write-offs all have tax consequences worth getting advice on.

If the loan simply sits there (nothing about it changes) or the company is just repaying it with no tax charge arising, you're in self-serve territory.

Key points

• A director's loan only breaks dormancy if something about it changes in the period: money lent or repaid, interest added, or some of it written off.
• A DLA balance that stays exactly as it was, with no interest added, keeps the company dormant.
• New lending, repayments, interest or a write-off mean the company isn't dormant, even if it isn't trading — file micro-entity accounts, not dormant ones.
• An overdrawn DLA can trigger a section 455 charge and a non-nil CT600 — that's an accountant's job.
• DormantFile files both: dormant accounts that carry a loan balance that didn't change, and micro-entity accounts for a loan being repaid with no tax charge.