by Steve Wiltshire

In what’s widely regarded as the biggest shake up in its history, new powers for Companies House are in store with the introduction of the Economic Crime and Corporate Transparency Act 2023.  Some powers have begun to come into force, and there are more to come.

The objective of these reforms is to tackle fraudulent activity, economic crime, and money laundering – but what does this mean for UK companies and their directors, and how you can prepare?

What’s already changed?

The following changes came into force on 4 March 2024:

• Registered email address: Companies must now provide an email address, which will be used by HMRC to communicate regarding the company; it will not be shared publicly.
• Registered office address: Companies must have a registered office address which is deemed “appropriate”, meaning companies will no longer be able to use a PO Box as a registered address.
• Enhanced powers for the Registrar: Companies House will have greater powers to query information that appears to be incorrect or inconsistent and will be able to clean up the register and remove information.
• Lawful statements: The shareholders of new companies will be required to confirm they are forming the company for a lawful purpose and existing companies will need to make a lawful purpose statement when they file their next confirmation statement.
• Directors and disqualification: There is a tightening of the rules relating to the disqualification of directors.

What’s in the pipeline?

Further changes are expected during the remainder of 2024 and 2025, but the government hasn’t yet set out a timetable for these.  These changes include:

• New rules for Corporate Directors: Corporate directors of UK companies will no longer be allowed unless they satisfy an exemption.
• Identity verification: This will be required for all new and existing registered company directors and Persons with Significant Control (PSCs).
• Companies House checks: Companies House will have enhanced scope for cross-checking data with other public and private sector bodies, and for sharing information with law enforcement bodies.
• Small and micro entities will no longer be permitted to file abridged or filleted accounts: Companies with fewer than 50 employees and a turnover under £10.2m will have to file a balance sheet, directors’ report, and profit & loss account. This is a significant and potentially sensitive change, which will mean that these companies’ financial performance will be available in public records.

Do I need to think about this now?

We’d suggest you do!  With the wide array of changes, some companies may find that there are hurdles that they need to overcome, so it’s better to prepare sooner rather than later.

How can we help?

We are well placed to help you navigate the changes, and what they mean for your business.  We can also assist in reviewing corporate structures and provide support with restructuring if appropriate.

Give us a call, fill out the contact form, or send us an email and we’ll be pleased to have a chat!