- Do you own or manage a company?
- Did you know there’s consultation underway around laws that affect you?
- Are you aware that changes are in the pipeline over the coming year?
The Department for Business, Energy and Industrial Strategy (BEIS) along with the Financial Reporting Committee (FRC) are commencing or coming to the end of consultation around a host of potential changes.
Some of these will be of interest to anyone who owns or manages a company, so you need to be aware of what’s going on. Note that you may need the assistance of your solicitor and accountant too.
Public Companies House registers
There are separate registers at Companies House for each of England and Wales, Scotland, and Northern Ireland. In England & Wales (the focus of this article), you need to register details of the company directors and shareholders, plus – in recent years – a new category of people called Persons with Significant Control (PSC).
The PSC register was added with a view to reducing crime. For example, if there is a shadow director who is making decisions but who isn’t visible as a director on the books/register. This might be because they are:
- Disqualified as a director
- Undischarged bankrupt
- Known criminal
- Hiding shares from their spouse
- Avoiding tax
Feedback is now in from the consultation, and detailed proposals are underway about how to reform the Companies House register.
It is likely that, particularly when a company is first set up, all registered directors will have to go through a process of having their identity verified by Companies House.
A lot of people use a company formation agent or a solicitor, accountant or other third party to do the incorporation work and filings for them. The proposals are likely to include new controls around who can act as that third party for you. For example, your accountant might also need to verify their identity with Companies House before providing this kind of service.
Remember, once available at Companies House, all this information is public and can be shared with other law-enforcement agencies.
If the proposals go through, they will also increase the power of the registrar to check and challenge the information that is being filed, and to refuse the filing if they’re not satisfied.
Finally, there is ongoing consultation about proposals to change the format of the company accounts that are filed. This might lead you to having to submit something more interconnected than just a final set of accounts.
We don’t know yet what size of business will be affected by these changes, but it’s likely that they will apply to LLPs as well as to companies limited by shares.
That said, even after the reforms are firmed up and finalised, they won’t be implemented until there is Parliamentary time to make them become regulation.
Due to the pandemic, various filing deadlines have been extended and procedural rules are being relaxed.
Importantly, the suspension of the wrongful trading liabilities (which was granted to give companies a better prospect of trading through this period) has been extended to 30 April 2021.
Whether this is useful or relevant to you and your business depends on the particular situation of your own company.
Other deadlines have now been extended to March or April, but the actual dates are dependent on when your original filing was due.
If you are relying on an extension to file your accounts/make other filings, then check with your accountant or company secretary to find out your own deadlines and take steps to ensure that you will be ready to meet them.
One other point. Covid-specific relaxations and amendments are slightly moving targets, and there is always a possibility that some of them (I would not assume all) will be extended yet again.
What this means to you
Things change all the time. To ensure you’re legally compliant, you can always give us a call. We’ll be happy to help.