Classification for Inactive Companies Required?2nd January 2020
Do you need to classify for your inactive companies?
Many of our clients are asking us whether companies that are no longer active and are, consequently, being liquidated or have been allowed to be struck off are required to make an ES classification and report in respect of economic substance in BOSS? As we know from our previous mailers, the first financial period in respect of which economic substance reporting is required, for legacy companies incorporated before 1 January 2019, commenced on 30 June 2019. Therefore, companies that were not formally struck off or liquidated prior to this date (i.e. on or before 29 June 2019) are required to make an economic substance classification and report accordingly through the BOSS portal.
A common misapprehension is that you will not be required to classify and file in respect of companies that are in penalty (and not struck off / liquidated) on 30 June 2019. This is incorrect – as these companies are technically inactive, they can be re-instated and so you must be sure to classify them and make the relevant filing.
It is important that you don’t let your company inadvertently become non-compliant with the legislation because you no longer need it, so to avoid unwanted penalties, please check the date of strike off / liquidation carefully and if you are unsure, please reach out to your usual customer service specialist or the NEST Team (email@example.com). And remember - we always advise that it is best practice to formally liquidate any companies which are no longer required and we can provide support with the liquidation process by BVI liquidators