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Company strike-offs refer to the striking off the register of limited companies as they are held at Companies House. When a strike-off is accepted, the business is no longer deemed to be a legal entity. Often viewed as the simplest and quickest way to close down a limited company formally, many directors choose this option when they want to dissolve one business to concentrate on others they run. It can be that directors who have fallen out with one another want to close a solvent business so they no longer have to work together, for example. There again, it is a popular way of winding up a business when the owner retires, especially if he or she does not want to pass it on or sell it.

However, some strike-off requests are rejected. At Salient Insolvency, we can offer you specific advice that takes into account all of your personal and business circumstances should this happen to you. Simply ask one of our professional insolvency practitioners about what would constitute the best course of action and we’ll lay out all of the options. In the meantime, however, it will be a good idea to find out why a strike-off might be turned down in the first place.

Why Are Strike-Offs Rejected?

Strike-off applications can be rejected for a number of reasons. Perhaps your DS01 application form hasn’t been completed properly, for example. If so, you can try again with our guidance. That said, it is more likely that your application request has failed because it does not meet the rules for a formal dissolution as laid out in the Companies Act of 2006. This statute means that officials are bound to reject applications for the following main reasons:

  • A creditor has objected to the application, usually because your firm owes them money and they wouldn’t be able to take further action against it if a strike-off were to be successful.
  • The limited company you run has been trading within the last three months. Firms effectively have to be dormant for a strike-off to be allowed.
  • There has been a change in the registered name of the business within the last three months.
  • There is another process in place that could supersede the strike-off request, such as liquidation proceedings.
  • The request for dissolution wasn’t made by a director of the company.
  • There is not a majority agreement among directors to strike the business off.

Please note that this is a guide only and that other, often more technical reasons may cause your application to fail. If so, we can offer our expertise.

What Can I Do Following a Rejection

Sorting out the issue that caused the strike-off application to fail and resubmitting it is one of the main options for any director who is serious about dissolving their company. It could, for example, be a matter of simply leaving it for a month or two before trying again so long as the enterprise isn’t trading, of course.

There again, it might be that seeking another route to close the company down is more appropriate given your circumstances. This might include, for example, seeking a voluntary liquidation of the business. Again, we can advise you if this might be a good idea and help to establish whether a members’ voluntary liquidation or a creditors’ voluntary liquidation would be preferable given where the business is today.

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