# Panicking over UK Limited Company Reporting



## robber_sec (Mar 12, 2021)

Hi guys,

I'm a US citizen living in the UK. I filed my income taxes on the 1040 last year without issue.

However, I spun up a UK Private Limited Company in June 2020, not thinking about the possible ramifications.

The company is 'dormant' and has never had any income, assets or expenses whatsoever.

I did not file 8832 to declare it a disregarded entity, and now the 75 day deadline for that has long passed. I do not have an EIN, either.

I am freaking out about this, to be frank, especially reading about the $10,000 penalty for failure to file 5471.

Can anyone who has been in a similar situation advise me?

Thanks in advance.


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## Nononymous (Jul 12, 2011)

If the company is currently "dormant" can you simply dissolve it somehow? Make it go away, report nothing, pretend it never happened, and all will be well.

If you need a company for something in future and you intend to remain fully compliant with your US taxes, figure out how to do it in a less painful way, if that's possible.


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## Jca1 (Aug 7, 2019)

I think you have a couple options:

1) Apply to Companies House to have the company struck off, forget about it, and see what happens -- probably nothing.

and/or

2) Find someone to submit the form with your tax return. There is a simplified format for using 5471 to report on a dormant company, but it needs to be done to the IRS' standard -- neither too complete nor too incomplete -- to avoid penalties. I don't think the 5471 is late yet, but maybe I've misunderstood something.

Given the costs and risks, you can work out which option is best. Whatever you do, I would not submit the 5471 late without going through some type of program, as the IRS routinely issues $10k penalties for filing this form late or incomplete.


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## 255 (Sep 8, 2018)

robber_sec -- Please relax. Form 5471 is generally filled with your personal tax return, which as Jca1 indicated, isn't due yet. As far as IRS form 8832, there is no requirement to file it, at all. Sure you missed, the initial filing deadline, but since you didn't file, the IRS will use it's default status and designate it as a foreign C Corporation, until you ultimately/eventually decide to change it's U.S. tax status (if you do.) If the company is indeed dormant, there are zero taxes due under any regime you choose (just a filing requirement.) You can always choose to change your companies status, say someday this year and utilize IRS form 8832 to elect to "change in current classification" (Part I, line 1b.)

For now, you need to do the following:

a. Apply for an EIN utilizing IRS form SS-4 Form SS-4 (Rev. December 2019) (irs.gov) Since you are overseas, you'll have to utilize the mail or fax options (if you were stateside, you could do it on-line.)

b. After you get your Limited Company's EIN, file IRS form 1120-F for 2020 2020 Form 1120-F (irs.gov) Again, since your company is dormant, you'll just have zeros, on the form (unless you decide to deduct some organizational expenses, not exceeding $5,000.) There is no minimum income for filing a corporate return -- if it is in existence, you have a filing requirement.

c. File IRS form 5471 with your annual IRS form 1040.

d. You're now good to go, just repeat b. & c. annually. If you subsequently determine that filing as a disregarded entity (assuming all corporate stock is held by a U.S. based C Corp.,) is preferable -- you can utilize IRS form 8832 to basically eliminate your separate corporation reporting requirement (you'll still need to file 5471 with your personal tax return.) Cheers, 255 

P.S. This CFC Audit Guide might be interesting to you: Determination of U.S. Shareholder and CFC Status (irs.gov)


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## eminam777 (Apr 8, 2021)

255 said:


> robber_sec -- Please relax. Form 5471 is generally filled with your personal tax return, which as Jca1 indicated, isn't due yet. As far as IRS form 8832, there is no requirement to file it, at all. Sure you missed, the initial filing deadline, but since you didn't file, the IRS will use it's default status and designate it as a foreign C Corporation, until you ultimately/eventually decide to change it's U.S. tax status (if you do.) If the company is indeed dormant, there are zero taxes due under any regime you choose (just a filing requirement.) You can always choose to change your companies status, say someday this year and utilize IRS form 8832 to elect to "change in current classification" (Part I, line 1b.)
> 
> For now, you need to do the following:
> 
> ...


Hi - I have a similar situation and have a question about your explanation. Why would a UK private limited company apply for an EIN? If you have two companies, would you have to file two 1120-F and two 5471s?


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