The Department for Business, Innovation and Skills (BIS) has announced a number of changes to company filing requirements which will reduce the red tape burden on companies. While the changes will have most impact on small companies, there are some which will also make life easier for those managing the administration of larger companies and groups.
In October 2013, the Government launched a consultation on proposals to improve and simplify the current requirements for UK companies to file certain information at Companies House.
The consultation highlighted various issues with the current filing requirements, including:
1. Potential duplication due to:
- requirements to hold information both at Companies House and at a company’s registered office;
- requirements to file information at Companies House more than once; and
- requirements to file similar, or the same, information at Companies House and at HM Revenue and Customs (HRMC);
2. Problems associated with inaccuracies on the register which, at present, the Registrar has no legal authority to deal with effectively (for example, a company giving a registered office address which it has no link with or an individual being appointed as a director without their knowledge); and
3. More could be done to update and amend the register quickly, including improving the use of electronic communications.
What do the reforms include?
Following careful consideration of the responses to the consultation, the Government has decided on a number of reforms to company filing requirements, aimed at improving the accuracy and integrity of the public register whilst also simplifying the current filing requirements. These include:
- Annual filings: Companies will have more flexibility to confirm whether their company information is correct and complete at any point in the year. The requirement to complete an annual return at a set point each year will be changed to a requirement to ‘check, notify changes if necessary and confirm’ information at least once in a 12 month period. Companies that make changes inside a 12 month period (for example, if appointing a new director or filing a return of allotment of shares) will be asked if they wish to check and confirm other information at the same time. If they do, no further action will be required for a further 12 month period (unless there is a change that needs to be notified).
- Joint filing tool: The Government will also be making improvements to the joint filing tool to ensure there is an easy way for small companies to provide data just once to fulfil both HMRC and Companies House requirements on the same date through one channel.
- Company registers: Private companies will be able to opt out of the requirement to keep and maintain the various registers including the proposed new register of company beneficial owners (see our previous Talking Business blog). Where a company exercises this option, it will need to ensure that the information on the public register is up-to-date in the same way that it is required to update its own registers.
- Directors’ dates of birth: To reduce the risk of identity theft and misuse of personal data, full details of a director’s date of birth will no longer be available on the public register. The public register will just show the month and year of birth. However, where private companies elect not to maintain company registers, the full date of birth will be included on the public register.
- Statement of capital: It can be difficult and often burdensome for companies to provide information about the amount of paid up share capital, particularly where companies have allotted shares at different prices or bought back, cancelled or consolidated shares. Accordingly, subject to certain limited exceptions, companies will only be required to show the aggregate amount unpaid on the statement of capital (rather than the amount paid and unpaid on each share).
As yet, there is no timetable for when these proposals will come into force but the Government has said it will amend the Companies Act 2006 to implement them as soon as parliamentary time allows.
For more information, email firstname.lastname@example.org.