B P Collins’ corporate and commercial team recently provided an overview of the changes brought in by the Economic Crime and Corporate Transparency Act 2023 (the Act) and what the Act means for your business.
The team now provides an update on some of the changes that have come into force as well as further details on the upcoming changes that will affect Companies House, statutory registers, accounts and the anticipated ID verification requirements.
Recent changes to Companies House
Registered email address
Since 4 March 2024, Companies House began the process to obtain registered email addresses from companies in two ways:
- if you are registering a new company, you will now be asked to provide a registered email address when you incorporate your new company; and
- when you file your next confirmation statement, Companies House will ask you to provide a registered email address.
The registered email address will not appear on the public record. However, it will be used by Companies House to contact the company and Companies House will use the email address to send important information such as filing reminders about missed deadlines. Therefore, it is important to provide an email address that will be monitored.
New powers for Companies House
Companies House’s functions are being expanded and Companies House will take a much more active role in reviewing filings. For example, they now have the power to refuse filings that appear to be inconsistent with filings previously made at Companies House.
The general false statement offence has been expanded so that an offence is committed if someone (without a reasonable excuse) delivers a document that is misleading, false or deceptive in a material particular. Prior to this change, the offence required someone making such a filing knowingly or recklessly.
For filings previously accepted and registered, Companies House now has expanded powers to give notice to companies that information appears to be inconsistent with other records held. Companies will have 14 days to deliver replacement or additional documents to resolve the inconsistency. Companies House also now has enhanced powers to remove documents from Companies House – however there may be regulations which limit the material that could be removed by Companies House.
Companies House also has been given a new power to require further information to be provided in order to allow Companies House to determine if a document was delivered correctly and whether any information in the filing is inconsistent with information already held by Companies House. It is a criminal offence to fail to comply with a further information request without a reasonable excuse.
The Act also allows for the creation of regulations that would require businesses to obtain specified information about their customers, or prospective customers, and report to Companies House any discrepancies between the information obtained and that which is at Companies House. The regulations could create new criminal offences in relation to failures to comply with these regulations.
In light of these changes, we would recommend that you review your Companies House filings now so that you are up-to-date before you receive a notice from Companies House. If you need help in carrying out a Companies House audit to identify any potential irregularities, our team is experienced in reviewing company filings, making recommendations and drafting the relevant documentation to correct the defects / irregularities identified.
Increased fees
Due to the expansion of the functions that Companies House will be expected to carry out, Companies House fees have been increased. Companies House has recently published the new fees that apply from 1 May 2024. Please see the below table to see some examples of the fee increases:
| Service | Current fee | New fee (since 1 May 2024) |
| Incorporation (via web incorporation service) | £12 | £50 |
| Incorporation (paper form) | £40 | £71 |
| Confirmation statement (via online WebFiling) | £13 | £34 |
| Confirmation statement (paper form) | £40 | £62 |
| Voluntary strike off (online) | £8 | £33 |
| Administrative restoration of company | £100 | £468 |
Upcoming changes to Companies House
Statutory registers
The Act will abolish the requirement for companies to maintain all statutory registers except for a register of members.
Therefore, companies will not need to maintain, on a separate register, a register of: directors, directors’ residential addresses, secretaries and a Persons with Significant Control (PSC) register.
The register at Companies House will become the sole, verified source of this information, so it will be vital that information on the register is maintained and up to date. To that end, the Act creates stringent requirements for keeping Companies House updated on all changes to directors, secretaries and PSCs. Specifically, Companies House will need to be notified of any changes in the relevant details within the period of 14 days beginning with the day on which a change occurred.
The Act also introduces some changes to the register of members, which a company will still be required to keep and maintain. If you currently keep your register centrally, this will no longer be permitted so you will be required to maintain your own.
Members of a company will have a duty to provide the company with the information it is required to keep and a duty to notify the company if any information changes. A company will also be given the power to require members (both existing and new members) to provide this information (a new offence is created by the Act for any member who does not provide it).
These measures are not yet in force, however it is still a legal requirement to keep these registers up to date. If you need any help with getting your registers up to date, please get in touch.
Accounts
Companies will soon only be able to file annual accounts by software only and web-based and paper filing options are expected to be phased over the next two to three years. If you currently file your accounts by paper or through Companies House’s online service, you may want to consider the software options available to you.
Micro entities and small companies will no longer be able to file abridged accounts. The Act introduces a requirement for both micro entities and small companies to file their profit and loss accounts. Small companies will also need to file a directors’ report.
An auditor’s report must also be delivered (unless the company is exempt from audit and the directors have taken advantage of that exemption).
ID Verification
All new and existing directors and PSCs, as well as any individuals who file documents with Companies House will have to go through an identity verification process. There may be some exceptions to the identity verification requirements for those delivering documents on someone’s behalf which will be announced in secondary legislation. However, if delivering documents on someone’s behalf, it will become a requirement for the person submitting the filings to include an accompanying statement.
Also, an individual will be prohibited from acting as a director unless their identity has been verified. For new companies registered after the relevant provisions of the Act have been enforced, a statement confirming that the identity of each individual director has been verified will need to be contained in the statement of proposed officers for that company on incorporation.
A criminal offence and/or fine will also be introduced both for directors and PSCs. Any company with unverified directors will also commit an offence.
There will be a transition period in place which will give existing directors and PSCs time to comply with the new identity verification requirements. The length of the transition period should be announced via secondary legislation, so at the current time, it’s not known how long this will be.
How will the ID verification process work?
There will be two ways in which ID can be verified. ID can be verified directly through Companies House which will involve the individual uploading a photograph of themselves which is then linked to a photo ID such as a passport or driving licence. Likeness matching technology will then be used to verify their identity. Alternatively, ID can be verified via an Authorised Corporate Service Provider (ACSP), often accountants and lawyers. ACSP must have been authorised by the registrar to conduct the ID verification process.
The ID verification requirement will likely require new secondary legislation and the verification systems will need to be developed, therefore it’s not envisaged that they will come into force quickly. Companies House is expected to publish guidance on the ID verification process over the coming months and B P Collins’ corporate and commercial team will be keeping a look out for any developments.
For further information or advice please call 01753 889995 or email enquiries@bpcollins.co.uk.Â
