On 4th March 2024, Companies House implemented significant changes to UK law. We highlighted the changes before they came into law back in February 2024, where our Director of Governance, Risk and Compliance, Suzy- Dawson Newbury explained the new measures.
With Companies House now gearing up to implement another series of reforms aimed at bolstering corporate transparency and combating economic crime, we’ve asked Candice Beynon, Director from our Altrincham office, to outline this next set of changes.
Take it away Candice
Upcoming changes, mandated by the Economic Crime and Corporate Transparency Act (ECCT), mark a pivotal moment in the journey towards a more accountable and transparent business environment. The ECCT Act, which will roll out reforms gradually between 1st March 2024 and 2026, will impact companies, partnerships, directors and individuals involved in Companies House filings on behalf of a company.
The overarching objective is to strengthen the functions of Companies House, enhance corporate transparency and facilitate growth by improving the quality of company information held on public record.
Here are some of the key changes that will impact businesses and individuals.
Lawful Purpose Statement
Going forward, companies must explicitly confirm that they are established for lawful purposes. This confirmation, along with details of the planned activities, must be included in the confirmation statement. Failure to provide this statement may result in the rejection of documents by Companies House, underlining the importance of operating within legal boundaries.
Registered Email Address
Effective from March 4 2024, all companies are required to provide Companies House with a registered email address for official correspondence. Failure to comply with this requirement will constitute an offence, highlighting the importance of maintaining effective communication channels with regulatory authorities.
Registered Offices
Businesses must now provide a legitimate physical address as their registered office, replacing the option of using a PO Box. This ensures that companies maintain a tangible presence and facilitates effective communication with regulatory bodies.
Identity Verification Measures
New identity verification measures will be implemented by the end of 2024, requiring individuals involved in UK businesses to comply with updated regulations. This will enhance data accuracy and bolster efforts to prevent fraud and financial crime.
Company Ownership
To promote transparency, Companies House will require more detailed shareholder information and impose limitations on the appointment of corporate directors.
Companies House Fees
Adjustments to Companies House fees will come into effect from May 1 2024, reflecting new expenses and ensuring the recovery of costs from current expenditures.
Financial Statements
Changes to financial reporting requirements will impact small and micro entities, mandating the submission of profit and loss accounts. This aims to provide stakeholders with essential information for making informed decisions.
Digitisation
The shift to digitisation will become mandatory, eliminating paper filing options for many businesses including the requirements for accounts to be filed digitally. Additionally, accounts will need to be fully tagged with iXBRL software, enhancing transparency and traceability.
Next steps
Companies House will communicate these changes to impacted businesses well in advance of the implementation date.
If you require any further information or help with any of the points raised in this article, please fill out the contact form below and one of our experts will be in touch.
