Restoration of a Company - Main reasons
There are mainly two reasons to restore a company:
- To continue trading.
- To release company assets such as property, pension funds or frozen bank accounts.
To continue trading
If a Company is to carry on trading the file must be brought completely up to date with all missing documents such as Annual Returns and Accounts (confirming solvency) filed at the Restoration Section at the Companies Office before the Court hearing, which will be approximately six or seven weeks after the Application is made. Please note that there is currently a fixed rate filing penalty of £100 per set of overdue accounts payable after restoration, but this could change to the full penalty at any time.
To release company assets
If the Company is only being restored to release assets, filing of Annual Returns and Accounts will not be required, but undertakings by the Applicants or Directors of the company will have to be given to the Court agreeing to re-apply for striking off once the assets have been released.
A priority service can be arranged for an extra fee. This can reduce the time from seven or eight weeks to between three and five weeks, provided all documentation can be filed immediately. You can decide to opt for this service after application has been made.
The Registrar of Companies has the power to strike a company off the register if it defaults in its statutory duty to lodge the appropriate annual returns or accounts at Companies House on time. Although the Registrar will send various reminders, it is possible that a company may be struck off before the owners have the chance to recover assets in the company's name or close bank accounts. This may happen for instance where a director has been absent for a prolonged period of time due to illness.
If your company has been dissolved, and there are assets or monies in the company's name, you will need to take prompt action to have the company restored to the Register. Such action requires the preparation of affidavits and statements to be presented to the Courts, and as this requires the assistance of a Solicitor, the process can often become protracted and expensive.