Summary

  • At dissolution, remaining company-owned cash, property and rights pass by law to the Crown as bona vacantia. The company bank account freezes and cannot receive payments.
  • A company voluntarily struck off cannot use administrative restoration. Restoring it through court and seeking a small discretionary DG2 grant are different routes.
  • The official DG2 illustration deducts £300 from £2,300, then 5% of the £2,000 remainder, leaving £1,900. Its former-shareholder route also requires all shareholders to apply, no existing creditors and an undertaking not to restore the company.

The last box is easier than the last balance

Picture a retiring technical consultant on the final afternoon in his office. The clients have been handed over. The lease is ending. A desk lamp and a houseplant fit in the last cardboard box. His solvent little company still has some cash, but that can wait. He owns the shares, has always instructed the transfers and would like Companies House to stop featuring in his retirement plans.

So he gets on with striking off the company before finishing its money.

This is a fictional business in England, within the ordinary remit of the Bona Vacantia Division, or BVD, outside the special jurisdictions of the Duchies of Lancaster and Cornwall. The last registered office and the location of assets matter. Scotland and Northern Ireland have different authorities. The geography determines where the problem goes after the owner has gone home.

The mistake is small enough to feel reasonable. The consultant owns the shares; the company owns the balance. Years of using the same banking password have made that distinction easy to overlook. Dissolution makes it considerably harder.

Companies House says the bank account freezes when the company is dissolved and can no longer receive payments. Remaining company-owned money, property and rights pass automatically to the Crown as bona vacantia. The Crown is the legal recipient here, not the monarch's personal spending account.

The freeze comes at dissolution, not when the application is submitted. Before that, the company still exists and can finish its permitted winding-up business. Afterwards, an old business card saying “director” cannot substitute for a living account holder.

A zero balance is a very narrow sort of reassurance

The application guidance tells owners to deal with assets first, including bank accounts and domain names. BVC1, the government's explanation of dissolved-company assets, extends the list to intellectual property, the benefit of contracts and mortgages owed to the company. The last asset may be a sentence in an agreement rather than something the removal van forgot.

That matters for a technical consultancy. A right to payment may exist before the money reaches the bank. A domain can remain in the company's name after the website has gone quiet. Software rights need an owner even when the office has no furniture. An empty account is evidence about an account, not an inventory of everything the company owns.

Tax refunds require particular attention before the exit. The current Companies House guidance says HMRC cannot process or issue refunds to dissolved companies. Claims and receipts need sorting beforehand. Abolishing the intended recipient and hoping the payment finds the shareholder is a bold theory of public administration.

Property held by the company as trustee for someone else is excluded from its own bona vacantia assets. So the final inventory also needs to distinguish ownership from custody. The founder may have used everything in the room. That does not settle who holds each right when the company disappears.

The first notice is still a chance to finish

Voluntary strike-off has conditions. Normally a majority of directors must agree; where there are two, both must apply, and a sole director applies alone. The company must not have traded, changed its name or disposed of trading stock in the ordinary course of business during the preceding three months. Activities needed to conclude its affairs, settle debts and comply with legal requirements are permitted under the rules.

Copies of the application must go within seven days to the specified interested parties, including members, creditors and employees. The duty continues for people who subsequently become relevant. A creditor omitted from the mailing list does not turn into spare money for the shareholders. Nor does strike-off replace the appropriate insolvency procedures.

In the ordinary voluntary process, a first Gazette notice is followed, if there is no reason for delay, by dissolution at least two months later. A second notice records it. That is not a guaranteed two-month countdown from pressing submit. If the directors change their minds or the company ceases to qualify, the application must be withdrawn immediately.

The first notice is therefore a useful moment to ask what remains payable, receivable or owned. It can look like a certificate of freedom to a tired founder. Reading it that way risks buying a restoration file with the time saved on one last check.

To recover the cash, recover its owner

Once voluntary strike-off has taken effect, administrative restoration is unavailable. That route is limited to specified registrar-initiated strike-offs and has its own requirements concerning applicants, filings, penalties and, where relevant, the Crown's waiver. A voluntary exit does not become administrative because the judicial route seems excessive for a modest balance.

Court restoration is generally available within six years of dissolution. The guidance expressly allows an applicant to explain that the purpose is simply to recover bank money or property. In England and Wales, restoration takes effect when the court order is delivered to the registrar. Incorporating a new company with the old name does not recreate the old account holder.

The restored company is treated as having continued in existence. If the Crown has already sold an asset, however, the recovery can be the consideration received less the costs of dealing with it, rather than the original thing. Legal continuity cannot put every intervening transaction back in its box.

There are costs to consider. A court can require payment of relevant proceedings, property and registrar costs. Existing late-filing penalties and document fees can remain payable. Accounts that became due while the company was dissolved do not automatically attract every possible late-filing penalty; equally, restoration is not a free reset of its past obligations.

Once the company has been restored, and the bank or other holder has referred the cash to BVD, an RA15 repayment application can recover those funds. There are no charges or deductions for that repayment application. The preceding restoration process can still cost money. The guidance's processing period of up to twenty working days begins with a complete, correct application, not the first approach to a court.

Restoration evidence and recipient bank documentation are required. Payment to a third-party account needs the relevant payment authority and identity evidence. A personal account may therefore receive money through an authorised arrangement. Former ownership of the shares is not, by itself, that arrangement.

The £400 deduction is only the visible price

DG2 offers a different route: a discretionary grant of up to £3,000 for a company that can still be restored, described in the guidance as dissolved less than six years ago. There is only one grant per company and no entitlement to receive it. BVD must already hold the money.

For the former-shareholder route of an ordinary commercial company, all shareholders must apply, there must be no existing creditors, and they must undertake not to restore the company in future. The application is more than a lost-property ticket.

The official worked example starts with £2,300. A £300 administration fee leaves £2,000. Because the remainder exceeds £750, a 5% reservation fee applies: another £100. The grant is £1,900. This is the government's illustration, not a reported loss suffered by a particular company. If BVD holds £300 or less, there is no grant to pay.

The £400 difference is easy to understand. The undertaking about future restoration takes more thought. An overlooked contractual right may later turn out to be worth pursuing. Choosing the apparently convenient route for a small balance can then carry a much larger consequence. Before valuing the shortcut, the former shareholders need to know what else is on the other side of the door.

Official sources