How Long Should You Keep Company Records After Liquidation?

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When a limited company goes into liquidation, the final stage of the process will be for it to be struck off the Companies House Register. While this moment marks the end of the existence of the company, there are still certain rules that companies must follow beyond this point. Many of these rules centre around your rights and responsibilities regarding company information and documentation and one of the most common questions we get asked is ‘How long should you keep company records after liquidation?’.

As per HMRC rules, company records must be kept for six years following the date of liquidation. This guidance matches the rules for companies operating normally, as the Companies Act 2006 also stipulates that records must be kept for six years after the most recent financial year. 

There may be exceptions to this rule if the company has previously been granted a shorter limit by HMRC. In cases of compulsory liquidation, the HMRC will inform the liquidator of how long records must be retained.

Why Must Company Records Be Kept After Liquidation?

Six years may seem like a long time to keep company records after liquidation, but the reasons for doing so are clear: companies can be restored for up to six years after their dissolution. 

A company can be restored to the Companies House Register for up to six years after its dissolution in one of two ways. The courts may reinstate the company if it was liquidated without correctly paying its creditors. You may also apply to have the company reinstated through an administration if you voluntarily liquidated the company and have changed your mind and wish to continue doing business. In both of these circumstances, previous documentation will be required.

HMRC may also request information about your company during this timeframe to assist with any new or ongoing investigations. For example, HMRC can pursue a dissolved company for up to six years if it believes that there are outstanding tax liabilities or that director misfeasance has occurred.

Possible Penalties

HMRC takes these rules seriously and failure to retain your company records for the correct length of time following liquidation can result in possible penalties. You should always cooperate and provide the relevant information promptly when requested to do so by HMRC. Fines of often thousands of pounds can be issued should your company fail to comply.

If your company is considering voluntary liquidation or is about to enter into the liquidation process, it is therefore important that you fully understand your rights and responsibilities regarding company documentation. You should always consult a licensed insolvency practitioner to guide you through this process and ensure that you are meeting your obligations.

At My Liquidation, our licensed insolvency practitioners have years of experience acting for limited companies during the formal liquidation process. Get in touch with the team today to discuss your options and receive transparent advice about liquidating your company.

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