What UK Companies Need to Know About the New Companies House Rules

New Companies House Rules

By Eurocompanyformations.com, 12th March 2024

Companies House is the UK’s registrar of companies, responsible for incorporating and dissolving companies, maintaining company information, and making it available to the public. Companies House has announced that it will introduce some significant changes to its rules and processes in March 2024, as part of its ongoing digital transformation and to improve the quality and reliability of its data.

In this blog post, we will explain what these changes are, why they are being implemented, and how they will affect UK companies. We will also provide some tips on how to prepare for the new rules and ensure compliance.

The Main Changes

The new Companies House rules will affect four main areas: filing requirements, verification, identity checks, and protection of personal information. Here is a brief overview of each area and what it means for UK companies.

  • Filing requirements: Companies will have to file their accounts and confirmation statements online, using a new digital filing service. Paper forms will no longer be accepted, except in exceptional circumstances. Companies will also have to use a new standard format for their accounts, based on the iXBRL (Inline eXtensible Business Reporting Language) standard. This will make it easier for Companies House to check and analyse the data, and for the public to access and compare it.
  • Verification: Companies will have to verify their company details with Companies House at least once a year, using a new verification code that will be sent to the company’s registered office address. This will ensure that Companies House has up-to-date and accurate information about the company and that the company is still active and operating. Companies that fail to verify their details within 14 days of receiving the code will be subject to penalties and possible dissolution.
  • Identity checks: Companies will have to provide more information about their directors, shareholders, and persons with significant control (PSCs), and verify their identity with Companies House. This will include providing their full name, date of birth, nationality, occupation, and service address, as well as a digital photo and a copy of an official identity document. This will help Companies House to prevent fraud and money laundering and to protect the public from rogue or impersonated companies.
  • Protection of personal information: Companies will have more control over the personal information that they share with Companies House and the public. They will be able to request that certain information, such as their registered office address, director’s date of birth, or shareholder’s residential address, be suppressed from the public register if they can demonstrate that it poses a serious risk of violence or intimidation. They will also be able to opt out of receiving unsolicited marketing communications from third parties, by ticking a box on the confirmation statement.

Why the Changes Are Being Implemented

The new Companies House rules are part of a wider reform of the UK’s corporate governance framework, aimed at enhancing transparency, accountability, and trust in the business environment. The changes are based on the recommendations of the Independent Review of the Quality and Effectiveness of Audit, the Brydon Review, and the Corporate Transparency and Register Reform consultation, which were conducted in response to several high-profile corporate scandals and failures in recent years.

The main objectives of the new rules are to:

  • Improve the quality and reliability of the data held by Companies House, by ensuring that it is accurate, complete, and up-to-date.
  • Reduce the administrative burden and cost for companies, by simplifying and streamlining the filing process and providing more digital services.
  • Strengthen the security and integrity of the register, by preventing and detecting fraud, money laundering, and identity theft.
  • Protect the privacy and safety of company officers and shareholders, by allowing them to limit the exposure of their personal information.
  • Enhance the accessibility and usability of the register, by making it easier for the public to find and compare company information.

How the Changes Will Affect UK Companies

The new Companies House rules will have a significant impact on UK companies, as they will have to comply with new filing requirements, verification procedures, and identity checks. They will also have to adapt to the new digital filing service and the new standard format for their accounts. These changes will require companies to update their systems, processes, and policies, and to train their staff accordingly.

However, the new rules will also bring some benefits for UK companies, as they will:

  • Save time and money, by reducing the need for paper forms, postage, and manual processing.
  • Improve their reputation and credibility, by demonstrating that they are transparent, accountable, and compliant.
  • Protect their identity and assets, by reducing the risk of fraud, money laundering, and impersonation.
  • Enhance their privacy and security, by limiting the exposure of their personal information and opting out of unwanted communications.
  • Increase their visibility and competitiveness, by making their information more accessible and comparable to the public and potential investors.

How to Prepare for the New Rules

UK companies should start preparing for the new Companies House rules as soon as possible, as they will come into effect in March 2024. Here are some steps that companies can take to get ready for the changes:

  • Register for the new digital filing service and familiarise themselves with its features and functions.
  • Review their current filing practices and identify any gaps or issues that need to be addressed.
  • Ensure that they have the necessary software and hardware to file their accounts in the iXBRL format.
  • Update their company details and verify them with Companies House, using the verification code that will be sent to them.
  • Gather and verify the identity information of their directors, shareholders, and PSCs, and provide it to Companies House.
  • Request the suppression of any personal information that they want to keep private from the public register.
  • Opt out of receiving unsolicited marketing communications from third parties, by ticking the box on the confirmation statement.
  • Keep track of the filing deadlines and penalties, and file their accounts and confirmation statements on time.
  • Seek professional advice or guidance from Companies House if they have any questions or concerns about the new rules.

The new Companies House rules are a major change for UK companies, and they will have to comply with them by March 2024. The changes are designed to improve the quality and reliability of the company data, reduce the administrative burden and cost for companies, strengthen the security and integrity of the register, protect the privacy and safety of company officers and shareholders, and enhance the accessibility and usability of the register.

UK companies should start preparing for the new rules as soon as possible, by reviewing their current filing practices, registering for the new digital filing service, updating and verifying their company details and identity information, requesting the suppression of any personal information, opting out of any unwanted communications, and filing their accounts and confirmation statements on time.

 

If you have any additional questions regarding the UK’s new Company House Rule and what this may mean for your company, please do not hesitate to contact the Euro Company Formations team. Call us at + 353 (0)1 6461627 or fill out our contact form.