• Contact Us

A Spring Clean at Companies House

on Monday, 11 January 2021.

In 2019, the Government commissioned a review on company regulation, corporate transparency and Companies House. The review has identified some key changes which could be made to how new and existing companies are administered and regulated.

The aim of the review was to find ways to improve the way the Registrar of Companies registers, maintains and regulates companies and other registered entities to help reduce crimes such as fraud, money laundering and tax evasion. Following the review, the Government has now responded and has proposed, as some have described, a "radical level of change". In the response, they mention that:

"the Home Office estimates that the social and economic cost of fraud to individuals in England and Wales is £4.7 billion per year and the social and economic cost of organised fraud against businesses and the public sector in the UK is £5.9 billion."

With figures such as these, there is a real need to ensure that UK corporations are not misused for criminal purposes. Here is a summary of some of the key proposed changes.

Identity Checks

Companies House could perform identity checks on directors, persons with significant control and individuals who file information on behalf of a company. Directors already have to provide personal information, such as their dates of birth, residential address and nationality so verifying this information through formal ID checks will help reduce fraud and submission of incorrect information.

How this will be achieved is still under review but it is likely that a form of online portal where individuals have to register their details will be developed.

Greater Powers

Companies House will be given more powers to review and query information that is submitted to it. At the moment, Companies House checks that forms and documents have been submitted correctly but does not necessarily check that the information contained in them is accurate. The Registrar of Companies will be entitled to remove information from the register and ensure better accuracy of the information it receives.

Deter Abuse of Corporate Entities

Regulated bodies under the anti-money laundering regulations (such as lawyers and accountants) will be required to report any discrepancies between the public register and the information they hold. There is currently an obligation on these bodies to report discrepancies on beneficial ownership records (persons or entities with significant control), but the proposal suggests a widening of this obligation to other information held at Companies House. The aim is to ensure that all information held on the register is accurate and up to date.

Company Registers

There is also a suggestion that certain registers such as the register of directors, register of secretaries, register of charges and register of persons with significant control will no longer need to be kept by a company. It is already a requirement to notify Companies House of the information which is kept on these registers so it has been questioned why a company needs to keep a separate record of this information. It is common to find discrepancies between the records at Companies House and a company's own statutory registers so keeping one central source of this information will help the administration and accuracy of a company's governance records.

For more information about what statutory registers companies are required to maintain, please visit our dedicated article here.

The changes may increase your company's obligations to deliver certain information to Companies House but it may also reduce the administrative burden of maintaining multiple statutory registers. The full effect of the proposed changes will be understood when a decision has been made on the number and extent of those changes which will hopefully be sometime next year. The Department for Business, Energy and Industrial Strategy is currently undertaking a consultation round on the new proposals which is due to close in February 2021. We are then likely to hear about the Government's plans later in 2021.

Coronavirus Legal Advice

If you have questions regarding your company's administrative obligations and Companies House, please contact Simon Ayling in our Corporate Law team on 020 7665 0919 or complete the form below.

Get in Touch

First name(*)
Please enter your first name.

Last name(*)
Invalid Input

Email address(*)
Please enter a valid email address

Please insert your telephone number.

How would you like us to contact you?

Invalid Input

How can we help you?(*)
Please limit text to alphanumeric and the following special characters: £.%,'"?!£$%^&*()_-=+:;@#`

See our privacy page to find out how we use and protect your data.

Invalid Input