SimpleReturns

HMRC sent a notice but your company never traded

Reviewed by Lee Jones, Founder · Updated 17 July 2026
The short answer

A notice to deliver a Company Tax Return is not an accusation, but you cannot ignore it: a return is expected until HMRC agrees otherwise, and a late return costs £200. If your company has never done anything, tell HMRC it is dormant; any activity at all, even a few pounds of bank interest, probably means you need to file.

Official source. This guide is a plain-English summary of official GOV.UK guidance, not advice. The authoritative source is Dormant companies and Corporation Tax on gov.uk. Always rely on that over our summary.

Why can't I just ignore the letter?

Because the letter itself creates the duty. The rule is simple: if HMRC sends your company a notice to deliver a Company Tax Return, the company must file one. It does not matter that the company made nothing, owes nothing, or never opened its doors. A loss-making year still files. A nil-tax year still files. The only way out is for HMRC to agree the return is not needed.

And the meter is unforgiving. File one day late and the penalty is £200. Three months late, another £200. At six months HMRC estimates a tax bill for you and adds 10% of it on top. That is how a company with £0 of tax to pay ends up owing hundreds of pounds, purely for staying silent. Our guide on whether you need to file a company tax return covers the rule in more depth.

Does your company count as dormant?

In plain English, dormant means the company is not doing anything. HMRC's own examples include exactly your situation: a new limited company that has not started trading.

The catch is that "trading" is wider than most people think. It includes buying, selling, renting out property, advertising, employing someone, and even getting interest. A company is also counted as active if it provides services, earns interest, or manages investments. So the test is not "did we make a profit". It is "did any money or business activity happen at all".

There is good news too. The set-up steps themselves do not count. Writing a business plan or negotiating contracts before you start is not trading in HMRC's eyes. So if you registered the company, paid for your shares, and then life got in the way, you almost certainly count as dormant.

What should you do? Three steps

  1. Check the company's activity honestly. Look at any bank account in the company's name, from the day it was formed until today. Is there anything on the statement beyond the money paid for shares when the company was set up? No account, or an account with nothing in and nothing out, is a good sign you are dormant. Anything else, keep reading to the trap below.
  2. Tell HMRC the company is dormant. Ring the Corporation Tax helpline on 0300 200 3410, open 8am to 6pm Monday to Friday, quietest between 8:30am and 11am. Have the letter in front of you, because it shows your company's 10-digit tax reference. Say plainly: the company has never traded, you believe it is dormant, and you want to know whether the notice still stands. You can also write to Corporation Tax Services, HM Revenue and Customs, BX9 1AX. One honest warning: gov.uk says that once a notice has been issued, you may still need to file a return online for that period to show HMRC the company was dormant. So do not treat the phone call as the finish line. The finish line is HMRC's answer, ideally the letter saying they have decided to treat your company as dormant and you do not have to pay Corporation Tax or file returns. Once you have that, you are done unless a new notice arrives, and remember to tell HMRC within 3 months if the company ever does start trading.
  3. Keep the Companies House filings going, no matter what. Telling HMRC changes nothing at Companies House. Your company still owes Companies House a confirmation statement and accounts every year, dormant or not. The silver lining: a small company that has never traded can file simple dormant accounts, with no audit. Skipping these is how never-traded companies collect penalties or get struck off. Our dormant company filing guide walks through both halves.

The trap: a few pounds of bank interest

This is the one that catches people. You opened a business bank account, parked £500 in it, and the bank paid you 43p of interest. In HMRC's eyes, getting interest is on the trading list and earning interest makes a company active. That 43p can be the difference between "dormant, no return needed" and "active, return required".

The same goes for any other stray activity: one invoice raised as a test, a single advertising payment, a friend's rent passing through the account. If anything like that has happened, say so when you ring HMRC, and be ready to file. Trying to claim dormancy for a company with movement on its statement is a much worse position than just filing a small, honest return.

What if it turns out you do have to file?

Then it is a chore, not a crisis, and it is a chore we have made painless. Once a notice stands, a nil-tax year or a loss-making year still needs the return, and the deadline is 12 months after the end of the period it covers, so our Corporation Tax deadlines guide is worth two minutes.

SimpleReturns turns the whole job into your bank statement plus a few plain-English questions, then files both the HMRC return and the Companies House accounts for £99 total. It is free to start, with no card needed, so you can see exactly what your return would look like before paying a penny.

Common questions

Do I have to file if my company never traded and owes nothing?

If HMRC sends your company a notice to deliver a Company Tax Return, the company must file one. It does not matter that the company made nothing, owes nothing, or never opened its doors. The only way out is for HMRC to agree the return is not needed.

What counts as dormant for Corporation Tax?

Dormant means the company is not doing anything, and HMRC's own examples include a new limited company that has not started trading. But trading is wider than most people think: it includes buying, selling, renting out property, advertising, employing someone, and even getting interest. Set-up steps like writing a business plan do not count.

Does a phone call to HMRC end the filing duty?

Do not treat the phone call as the finish line. Once a notice has been issued, you may still need to file a return online for that period to show HMRC the company was dormant. The finish line is HMRC's answer, ideally the letter saying they have decided to treat your company as dormant.

Do I still file at Companies House if HMRC agrees the company is dormant?

Yes. Telling HMRC changes nothing at Companies House. Your company still owes Companies House a confirmation statement and accounts every year, dormant or not, though a small company that has never traded can file simple dormant accounts, with no audit.

Does a few pounds of bank interest really matter?

It can. In HMRC's eyes, getting interest is on the trading list and earning interest makes a company active. Even 43p of bank interest can be the difference between dormant with no return needed and active with a return required, so mention it when you ring HMRC.

Turns out you do need to file?

SimpleReturns turns the whole job into your bank statement plus a few plain-English questions, then files both the HMRC return and the Companies House accounts for £99 total. It is free to start, with no card needed, so you can see exactly what your return would look like before paying a penny.

Start your return

And if HMRC agrees your company is dormant and withdraws the notice, you may not need us at all this year. We would rather tell you that plainly than sell you a filing you do not need.

General guidance, not advice. This guide explains how the rules generally work for small UK limited companies. It isn't tax advice for your specific situation, if you're unsure, check with us or an accountant.