When setting up a Limited (Ltd) company in the United Kingdom, one of the most common questions new entrepreneurs ask is:
“What’s the minimum turnover required to keep a Ltd company active or compliant in the UK?”
The short answer is — there’s no minimum turnover requirement to register or maintain a UK Ltd company.
You can legally form a company even if your business has not started trading or isn’t earning any income yet. However, there are still legal and financial responsibilities you need to follow.
Let’s break this down clearly.
What Is “Turnover”?
Turnover simply means the total revenue your company earns from selling products or services before expenses are deducted.
It represents your gross income, not profit.
For example, if you sell £20,000 worth of products, your turnover is £20,000 — even if your profit after costs is much lower.
Minimum Turnover to Register a Ltd Company
There’s no minimum turnover required to:
- Register a Ltd company with Companies House
- Keep your company active
- Maintain your business registration
You can even register a company before making any sales — many business owners do this to reserve a company name, open a bank account, or prepare for future operations.
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What If Your Ltd Company Has No Turnover?
If your company has not yet started trading or made any income, it’s considered dormant.
A dormant company means you’ve registered it but haven’t done any business or received any revenue.
Even in this case, you still have responsibilities, including:
- Filing annual accounts (Dormant Accounts) with Companies House
- Submitting a confirmation statement once a year
- Notifying HMRC that your company is dormant (so you don’t get taxed)
✅ Tip: This status helps you keep your company name protected while avoiding unnecessary tax filings.
When Does Turnover Start to Matter?
Turnover becomes important for your Ltd company when it comes to taxes and VAT registration:
1. Corporation Tax
As soon as your company starts trading, you must:
- Register for Corporation Tax with HMRC
- Pay tax on your profits (19%–25%)
- File a company tax return (CT600) annually
If your company has zero income, you won’t pay any Corporation Tax, but you must still submit a “nil return” to stay compliant.
2. VAT Registration Threshold
If your annual turnover exceeds £90,000, you must register for Value Added Tax (VAT).
Below that threshold, VAT registration is optional but can still be beneficial for reclaiming input tax.
Example Scenarios
Let’s look at a few examples to clarify:
| Scenario | Turnover | Trading Status | Requirement |
|---|---|---|---|
| Startup with no sales | £0 | Dormant | File dormant accounts only |
| Small online seller | £25,000 | Active | File CT600 and pay Corporation Tax |
| Growing business | £95,000 | Active | Must register for VAT |
| Consulting firm | £60,000 | Active | Optional VAT registration |
Does Low Turnover Affect Compliance?
No, the UK doesn’t penalize companies for having low or no turnover.
Your responsibilities remain the same whether you earn £1 or £1 million:
- File annual accounts
- Submit confirmation statements
- Maintain accurate company records
Failing to file on time, however, can lead to penalties — even if your turnover is zero.
Benefits of Having an Ltd Company Even with Low Turnover
Even if you’re not generating a large income yet, having a registered Ltd company offers major benefits:
- Professional image and credibility
- Separate legal identity
- Protection of your business name
- Tax efficiency for future growth
- Ability to open a UK business bank account
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When Should You Close or Keep It Dormant?
If you expect to start trading soon, keep your company dormant and file minimal returns.
If you no longer plan to use it, you can apply to dissolve it through Companies House using form DS01.
Keeping it active is worthwhile if you plan to:
- Launch within 12–18 months
- Secure clients or investors
- Build brand credibility early
Final Thoughts
So, what is the minimum turnover for an Ltd company in the UK?
✅ There’s no minimum turnover requirement to form or maintain a Ltd company.
You can register a company even before you start trading — and as long as you file the required reports and inform HMRC of your company’s status, you’ll stay compliant.
Whether you’re a small business, freelancer, or international entrepreneur, the UK’s system is designed to make company ownership accessible and transparent for everyone.
If you’re ready to form your Ltd company, Corpulate.com can help you register, file documents, and stay compliant every step of the way.
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FAQs:
No. You can start an Ltd company with no sales or income.
It’s considered dormant. You must still file dormant accounts and a confirmation statement.
Only if your turnover exceeds £90,000 per year.
Yes, as long as you file the required returns and maintain compliance.