From 3 March 2024, Companies House expects to enact its new powers under the Economic Crime and Corporate Transparency Act to query information provided to its Register. Accountants should review their client's registered details to ensure that they comply accordingly.

You can expect:

  • Stronger checks on company names.
  • New rules for registered office addresses which will mean all companies must have an appropriate address at all times. Companies will not be able to use a PO Box as their registered office address.
  • A requirement for all companies to supply a registered email address.
  • A requirement for all companies to confirm they’re forming the company for a lawful purpose when they incorporate. Every year, the company will need to confirm that its future activities will be lawful on their confirmation statement.
  • Annotations on the register to let users know about potential issues with the information that’s been supplied to us.
  • Taking steps to clean up the register, using data matching to identify and remove inaccurate information.
  • Sharing data with other government departments and law enforcement agencies.

These early changes aim to stop fraudulent information being accepted and published on the register. 

Filing changes

Small companies and micro-entities will be required to prepare annual accounts in accordance with the requirements of section 396 Compaines Act 2006:

  • They will be required to deliver a profit and loss account and a directors’ report.
  • Micro-entities retain the option to not prepare a directors’ report.
  • There will no longer be an option to file abridged accounts.
  • There will be an eligibility statement for companies claiming an audit exemption.
  • Documents will be delivered together, in cases where more than one document is filed, including for the filing of accounts

Company accounts will need to be filed digitally in iXBRL form and tagged.

Further reforms give new powers to the Registrar including identity checks for directors and restrictions on corporate directorships.

Future plans

The Government's 'Corporate Transparency & Register Reform White Paper' set out the next stages in its plans for wide-ranging reforms to the powers and role of Companies House. It aims to achieve the following:

  • Improve the quality and value of financial information held on the Register.
  • Increase the powers of the Registrar in order to protect the integrity of the Register to promote enterprise and reduce economic crime.
  • Increase transparency by restricting corporate directorships.

The exact timescale for the introduction for the remaining measures to come into force in 2024 is not yet clear it forms part of the Companies House's five-year strategy.

Improving the quality & value of financial information 

In order to improve the quality and value of the financial information held on the Register, there are proposed:

  • Changes to reporting of financial information which include:
    • Micro-entities and  will lose the ability to file abridged and filleted accounts.
    • Small and micro-entities will need to file a balance sheet and a profit and loss account.
    • Small companies (other than micro-entities) must file a directors' report.
    • Dormant companies will need to file eligibility statements.
    • A ‘file once’ approach, whereby a single filing is made with Government rather than filing with different departments, will be explored.
  • Changes to reporting of shareholder information include:
    • Companies will be required to record the full names of shareholders in their registers.
    • Private companies and traded companies (where shareholders hold at least 5% of issued shares of any class) must provide a one-off shareholder list. Changes are then updated annually when filing confirmation statements.
    • Companies claiming exemption from providing Persons with Significant Control (PSC) details will need to provide further information to prove exemption.
  • New identity verification requirements:
    • New and existing directors, Persons with Significant Control, members of Limited Liability Partnerships and General Partners of Limited Partnerships will require a verified account. This will require their identity to be verified.
    • A verified account can be set up directly with Companies House or details can be provided through a third-party agent.
    • A director cannot be registered without a verified account.
    • Unverified directors and companies directed by such directors will have committed an offence and are subject to sanction.
  • New procedures for incorporation agents:
    • The requirement to be registered in the UK and be registered with a UK supervisory body for AML purposes.
    • Changes in supervisory body registration must be notified to Companies House.
    • Be required to conduct Customer Due Diligence checks under the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017.
    • Registration with Companies House.
    • Submit evidence of their identity verification checks undertaken on prospective directors.

Other proposed changes include:

  • Removing the paper filing option for most companies.
  • Limiting the number of times a company can shorten its annual accounting period, which may be aligned with the five-year rule for lengthening an accounting period.

Powers of the Registrar

The Registrar will be given new powers to increase the integrity of the information held by the Register which includes:

  • New querying and checking powers:
    • Power to query, reject and remove information supplied to the register including; new filings, existing information and in some cases company names and registered offices.
    • Powers will be used on a discretionary basis using a risk-based approach likely to be adopted if information is suspicious, fraudulent or likely to impact the integrity of the Register.
    • Further checks will be introduced for new filings which will include, ID verification checks and checking prior compliance for any outstanding documents.
    • Rejected documents will be returned with a reason for rejection.
    • The company will then have the opportunity to provide further information within 14 days.
    • Companies House will then have the discretion to accept or reject the filing based on the further evidence provided.
    • Non-compliance can be punished by imposing a sanction on the entity. Further sanctions are being considered.
  • Increased powers to share data
    • The Registrar will be able to pass relevant information (that is all information held by Companies House) to certain public, regulatory and supervisory bodies including law enforcement where:
        • It is required to allow the Registrar to fulfil its statutory role and function.
        • It will assist other bodies in the prevention of crime or in the interests of national security.
        • It will assist regulatory and supervisory bodies to fulfil their obligations and function.
    • The Registrar will be able to cross-reference data held by public and some private bodies to check accuracy.
    • Discrepancy reporting requirements will be expanded to include director information and registered office addresses. The Registrar will be able to extend these provisions in the future as necessary.
  • Enhance privacy mechanisms
    • Information will be suppressed and not visible to the public if the applicant can show they are at risk of harm. Applications can be made before the information becomes public. This information will still be available to certain groups such as law enforcement.
    • Information that can be suppressed can include:
      • Signatures.
      • Dates of birth.
      • Residential and sensitive addresses.
    • Business occupations will no longer be required and will be removed from the public Register.
    • The Registrar will have the flexibility and discretion to suppress further information in the future as is necessary.
    • Historic records for dissolved companies will be retained for 20 years and then removed from the public record.

Corporate directors

The Government has the power to prohibit the appointment of corporate entities to company boards. It proposes to amend the rules to restrict the appointment of corporate directors, as follows:

  • All entities registered at Companies House will have at least one fully verified natural person directly associated with them on the Register.
  • The appointment of a corporate director must satisfy two conditions:
    • That all directors of the company seeking such appointment are themselves natural persons.
    • Those natural person directors are, prior to the corporate director appointment, subject to an appropriate identity verification process.
  • Any company failing to satisfy these grounds of exception will not be permitted to act as a corporate director.
  • A number of other measures are also in preparation that further tighten the rules for corporate directorship. For example, it will be made clear in law that corporate directors may only be appointed if they have a legal personality (that is they are able to function in business as a natural person).
  • Compliance should extend consistently to all appointable entities including limited liability partnerships.
  • Corporate directorships are restricted to entities registered in the UK.

The start date for amendment to these rules is to be announced, the reforms will be made using secondary legislation

Small print & Links

These are all to external links

Corporate Transparency & Register reform, white paper

  •  The government’s position on reforming Companies House ahead of introducing legislation into Parliament.

Previous consultations in December 2022, closed in February 2021.

Implementing the ban on corporate directors

Powers of the registrar

  • To give the registrar new powers to query information, which will be exercised on a risk-based approach.
  • The consultation also explores how the registrar’s powers could be strengthened in a range of areas, including closing various loopholes and amending or removing information from the companies register.

Improving the quality and value of financial information on the UK companies register

  • How companies might in future be able to file accounts once only with government, instead of separately to Companies House, HMRC and other agencies.
  • The filing options are available to small companies with the aim of achieving a better balance between minimising burdens and ensuring the information provided is valuable.
  • The proposal that all companies should file accounts digitally with Companies House.
  • Additional checks Companies House could carry out on accounts filings.

Economic Crime and Corporate Transparency Bill 2022: Factsheets

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