Dissolved companies are removed from the register of companies house which means they don’t contain any legal existence. Hence, the names of these companies can be used again while registering a new or existing company in the UK. But you should note that the re-used name should follow the rules of the Companies Act 2006.
Whilst the process, you should note that the previous company’s transactions will not be transferred to the new business. The dissolved company and the new company would be considered separate legal entities.
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The Reputation of the Dissolved Company:
The reputation of the dissolved company, of which you’re using the name, will impact the new company’s reputation. If the dissolved company contained a bad reputation, the new company, with a similar name, will be affected. On the other side, if the dissolved company was reputable amongst the masses, the new company will reap its fruits.
People associate businesses with their names, even if the owners, directors, and the business sectors are totally different or the businesses have a separate company registration number (CRN). The image of your business might be based on the name of the company you’re choosing.
Research Before Choosing the Name:
It is advisable to do thorough research before choosing a dissolved company’s name due to multiple factors. You need to review the following:
- Find out the last set of accounts of the dissolved company available on the Companies House Website.
- Perform a credit check to know if there are any outstanding County Court Judgements (CCJs)
- Search out the company on the internet to find out news, press, customers’ review to explore the company’s reputation
In case if the old company has got a good reputation, this would be beneficial for your business. It will increase the customer base and grow your business.
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Problems Registering Dissolved Companies Names:
Many company formation agents face issues while registering dissolved names through electronic incorporation. Their searches, sometimes, unable to show and distinguish the status of dissolved companies at companies house. Consequently, they consider the name found on the lists as taken.
If you’re purchasing a company that has registered a dissolved company name, you can buy it without any fear. However, you have to invest some time to contact a company formation agent, who’ll go through the system to make the final decision.
Afterward, the application is sent to companies house and the three-hour clock begins.
Quick Wrap up:
So after reading this blog, you have known that you can use the dissolved companies’ names to register as a new company. We’ve covered how the name affects the reputation of your business and what are the things and problems to consider before choosing the name of a dissolved company for your business. We hope it was useful.
If you’re in search of further assistance, don’t hesitate to leave your query to our Limited Company Accountant.
Disclaimer: This blog is written for informational purposes only.