Dissolve or keep your dormant company in 2026? A real cost-benefit breakdown

By DormantFile · Updated 27 May 2026

More directors are asking this question in 2026 than ever before. Companies House fees rose sharply in 2024 and again this year, ECCTA identity verification has added admin to every active company, and several high-street banks are quietly closing accounts on companies that show no activity. The maths on "just leave it dormant" has shifted.

This guide walks through the real costs on both sides, the hidden traps, and a short decision framework to settle the call.

The two options at a glance

Reasons to keep it dormant

A dormant company is not free, but it does buy you optionality. The cases where keeping it makes sense:

You plan to trade again within a few years. Restarting a dormant company is fast and free. Reactivating a dormant company is just a matter of telling HMRC the company is active again and filing trading accounts at the next year end. Restoring a dissolved company is slow, expensive and not always granted.

The name has value. Once a company is dissolved, the name goes back into the pool and anyone can incorporate a new company using it. If your brand, domain or social handles are tied to that name, dissolving hands the name to whoever registers it first.

You hold an asset inside the company. Intellectual property, a domain portfolio, a trademark registration, a small shareholding — all of these need to be transferred out before strike off, otherwise they pass to the Crown under bona vacantia (more on that below). If transferring is awkward, dormancy is the cheaper option.

You want the filing history. Years of clean filing history is useful when applying for finance, leases, or supplier credit later. A new company has no track record. An old one with a decade of clean confirmation statements does.

You are not sure yet. Indecision is a legitimate reason. The cost of one more dormant year is small. The cost of a wrong dissolution is high.

Reasons to dissolve

Equally, there are clear cases where strike off is the right call.

You are genuinely finished with the venture. No plans to restart, no IP, no brand worth protecting. Paying £60-odd a year forever to keep a shell on the register is just a slow leak.

ECCTA admin is piling up. The Economic Crime and Corporate Transparency Act has made every active company director go through identity verification at Companies House. For one company you care about, that is fine. For two or three legacy shells you do not really need, it is friction without benefit.

Your bank has started asking questions. Several UK banks have been closing or restricting business accounts on companies showing no activity for 12+ months. If your bank has written to you, or has already closed the account, running a dormant company without a bank account is awkward — and opening a new one for a dormant company in 2026 is harder than it used to be.

You missed filings and want a clean exit. If your company is already drifting toward strike off and you have no plans to revive it, finishing the job intentionally is cleaner than letting Companies House do it for you. See what to do if your company is in CATO closed status for the messier version of this.

The annual cost just is not worth it. For a company that does literally nothing, even £60 a year is real money.

The hidden costs of dissolving

Strike off looks cheap — £33 to file a DS01. But there are two costs people often miss.

Bona vacantia. Anything still owned by the company at the moment of dissolution passes to the Crown. That includes money in the bank account. If you forget to empty the bank account before strike off, the cash is gone — recovering it requires a Treasury Solicitor application and is not guaranteed. Same goes for any unclaimed assets: domain names, IP, leftover stock, a leased asset that was never returned.

What happens to your bank account when the company is dissolved. The account is frozen the moment Companies House publishes the dissolution. Any balance is transferred to the Crown. Direct debits stop working. Refunds sent after dissolution cannot be banked. You need to close the account before the company is struck off, not after.

Restoration is expensive. If you dissolve and then change your mind, administrative restoration costs roughly £468 in Companies House fees alone, plus any late filing penalties for missed accounts during the dissolved period. Court-ordered restoration is several thousand. Compare that to the ~£60 a year cost of just keeping the company dormant in the first place.

The annual cost of keeping it dormant in 2026

Let us be honest about the running cost:

• Confirmation statement (CS01): £34 a year, paid to Companies House
• Dormant accounts (AA02): £0 if you file yourself, or ~£29 via DormantFile — see the full breakdown in our cost to file dormant accounts guide
• CT600 nil return: £0 — HMRC does not charge to file
• Bank charges: £0 if the account is closed or on a free dormant tariff; up to ~£60 a year if a paid business account is left open

Realistic annual cost: £34 if you DIY everything, £63 if you use a filing service. Miss a deadline and the late filing penalties start at £150 — so the value of getting it done on time is real.

Compare that to £33 for a one-off DS01. The break-even point is about one year. If you are confident you will not need the company within ~12 months, dissolving is cheaper. If you are not, dormancy buys you optionality at a small annual cost.

A three-question decision framework

Run through these in order. The first "no" is your answer.

1. Is there any chance — even a small one — that you will trade through this company again within 5 years? If yes, keep it dormant. The cost of one or two more years of dormancy is trivial compared to the cost of restoration.

2. Does the company hold anything worth more than £500 — a name with real brand equity, IP, a domain, cash, a contract? If yes, keep it dormant (or transfer the asset out cleanly first). Bona vacantia is not worth the gamble.

3. Does the company have at least 3 years of clean filing history you would not want to lose? If yes, lean toward keeping it dormant. That filing track record has option value for future finance applications.

If you answered no to all three, dissolve. File the DS01, close the bank account, and move on.

If you are still unsure: keep it dormant for one more year, set a calendar reminder for next April, and reassess. The filing deadlines for dormant companies are predictable, so you can plan the decision properly rather than rushing it.

For the mechanics of either route, see how to close a dormant company for the strike off process, and the difference between dissolved and dormant status if the terminology is still fuzzy.

If you decide to keep it dormant

DormantFile exists for exactly this scenario: a director who has a dormant company they want to keep on the register, but does not want to spend hours each year wrestling with HMRC and Companies House portals. We file your dormant accounts and your nil CT600 for a flat fee, on time, with proof. Have a look at how it works or the pricing — and if you decide to dissolve instead, we will be the first to say so.