Corporate Governance & Regulation

Companies House has announced that they have new bank details effective from 1 September 2020. This is due to a Companies House change in status from a trading fund to a central government organisation. This has necessitated the introduction of a different type of bank account which come under the Government Banking scheme.

Any letters Companies House sends from 1 September 2020 will include the new bank account details and instructions. Companies House have also updated their bank details in any online guidance and emails.

The old bank account will remain valid and stay open for 6 months to make sure that all customers transition successfully to the new account. The old account will close at the end of February 2021.

Companies House has confirmed that the temporary measure to suspend compulsory strike-off action will be lifted from 10 October 2020. The temporary measure to pause compulsory strike-offs started in April 2020 in response to the coronavirus pandemic. 

When a company is struck off, the company's legal existence is removed from the Companies House register. The strike-off can be voluntary or compulsory. 

From 10 October 2020, Companies House will resume the compulsory process to remove a company from the register if there’s reasonable cause to believe it’s no longer carrying on business or in operation.

This includes:

• company documents are outstanding, and Companies House have had no response to their letters
• letters sent by Companies House are returned undelivered
• the company has no directors

Companies that do not file their annual accounts or confirmation statement will normally receive two letters from Companies House. A notice is then published in the Gazette to tell the public that the registrar intends to strike-off the company.

When compulsory strike-off action resumes from 10th October – if there are no objections to dissolution and the two month period from the publication of the Gazette notice has expired – a company will be struck off shortly afterwards.

If a company is in default and wants to remain on the register then action should be taken before 10 October 2020 to remain registered.

As well as filing accounts with Companies House, there is an important requirement to check that the information Companies House has about your company is correct every year. This is facilitated by the filing of an annual company confirmation statement. The confirmation statement was introduced in June 2016 and replaced the annual return. You could be subject to a fine of up to £5,000 for failing to send a confirmation statement. Companies House can also prosecute a company and its officers for failing to file a confirmation statement and the company can be struck off.

A confirmation statement must usually be filed at Companies House once every 12 months and rather than resubmitting data every year the confirmation statement only needs to be updated if you have changes to report. If there are no changes then you just need to confirm the information is correct and submit the statement. The due date is usually a year after either the date your company incorporated or the date you filed your last annual return or confirmation statement. You can file your confirmation statement up to 14 days after the due date.

The following details need to be checked:

• the details of your registered office, directors, secretary and the address where you keep your records
• your statement of capital and shareholder information if your company has shares
• your SIC code (the number that identifies what your company does)
• your register of 'people with significant control' (PSC)

Any necessary updates to the statement of capital, shareholder information and SIC codes can be made when submitting the confirmation statement. However, the confirmation statement cannot be used to report changes to your company’s officers, the registered office address, the address where you keep your records, people with significant control. These changes must be filed separately with Companies House and this should be done at the same time or prior to submitting the confirmation statement. The confirmation statement can be filed online (at a cost of £13) or by post (at a cost of £40).

The Corporate Insolvency and Governance Act 2020 (the Act) received Royal Assent, with most provisions coming into force on 26 June 2020. The Act addresses numerous issues arising for businesses from the COVID-19 pandemic to give distressed businesses the breathing space they need to get advice and seek a rescue

Some of the key provisions of the Act are as follows:

• introduces temporary easements for Annual General Meetings (AGMs) and filing requirements for public limited companies (PLCs)
• introduces new corporate restructuring tools to the insolvency regime to give companies the time they need to maximise their chance of survival
• temporarily suspends parts of insolvency law to support directors during this difficult time

Under the secondary legislation, companies will temporarily receive an automatic extension for:

• confirmation statements
• registrations of charges (mortgage)
• event-driven filings, such as a change to your company’s directors or people with significant control

Most companies will also be given more time to file their accounts. If a company is eligible, Companies House will update the filing deadline automatically and the new deadline should be adhered to. Companies do not need to apply for an extension.

HMRC is responsible for the money laundering supervision of a number of businesses including estate and lettings agents. Estate agency businesses that HMRC is responsible for supervising should be aware of the requirement to register with HMRC and the penalties for not doing so. It is a criminal offence to trade as an estate agency or letting agency business (as defined within the Regulations) without being registered for money laundering supervision.

The following business types are not required to register:

• a lettings agent only carrying out lettings work not defined within the Regulations, for example, below 10,000 euros per month
• an auctioneer already registered with HMRC as a high value dealer
• publishing adverts or distributing information, for example in a newspaper
• an intermediary, like an internet property portal for private sales, allowing private sellers to advertise their properties and letting sellers and buyers to contact each other (but only if you do nothing else covered by the general definition of estate agency work)
• a solicitor carrying on estate agency work as part of that practice as a solicitor, and not as a separate business

There are also estate agents who may be regulated by the Financial Conduct Authority (FCA), for example, because they provide consumer finance or hire purchase services. In this situation HMRC and the FCA will consider the possibility of a single supervisor overseeing the anti-money laundering arrangements on a case-by-case basis.

Company directors and other eligible people such as company secretaries, people with significant control (PSC) and LLP members can apply to remove their personal addresses from the UK’s official company register on Companies House.

Company directors and others are still required to provide an alternative correspondence address if they are appointed to a live company. If they are no longer appointed to a company, then an alternative address is not required and only the first half of their postcode will be made available to the public. The option to remove your home address from the public register is not available if the home address is the same as the company’s registered office address.

There is a charge of £55 per document where a director wants to suppress their home address. During the COVID-19 outbreak, the fee should be paid online before the application is submitted. The quickest way to proceed is to email a copy of the SR01 application to Companies House. This will allow Companies House to process the application without delay. Applicants can still send a completed SR01 application by post, but it is taking Companies House much longer than usual to process paper applications due to Coronavirus.

There are special rules in place which limit the ability to change a company’s year-end date. A company’s year-end date is also known as its ‘accounting reference date’ and is historically set by reference to the date the company was incorporated. Under certain circumstances it is possible to make a change to the year-end.

As a general rule, you can only change the year-end for the current financial year or the one immediately before it. Making a change to a year-end date will also change the deadline for filing accounts (except for during a new company’s first financial year).

There is no limit to the amount of times you can shorten a year-end date, but you can only extend the period to a maximum of 18 months once in every five years. The financial year can be extended more often under limited circumstances such as when the company has been put into administration.

A request for a change to an accounting reference date can be made online using the Companies House online service or by using a postal version of the Change your company accounting reference date (AA01) form. No change can be made to a period for which accounts are overdue.

There is no overriding reason for using one date over another but there are a number of factors to consider. The most common year end dates are usually 31 December (to coincide with the end of the calendar year) or 31 March (to coincide with the end of the tax year).

Companies House has confirmed that businesses will be provided with additional support to help them meet their legal responsibilities in light of the COVID-19 outbreak.

The measures include the following:

1. Companies House will temporarily pause the strike off process to prevent companies being dissolved. This will give businesses affected by the coronavirus outbreak the time they need to update their records and help them avoid being struck off the register.
2. Businesses can make an application for a 3-month extension to the deadline for filing their accounts. Businesses must apply for the extension before their filing deadline. Companies House has confirmed that those citing issues around COVID-19 will be automatically and immediately granted an extension. The best way to file is using the Companies House fast-tracked online system.
3. Companies House have also stated that companies issued with a late filing penalty due to COVID-19 will have appeals treated sympathetically.
4. The Secretary of State will continue to monitor what companies are filing and will provide further extensions if needed.
5. The government will introduce legislation to ensure those companies required by law to hold Annual General Meetings (AGMs) will be able to do so safely, consistent with the restrictions on movement and gatherings introduced to address the spread of coronavirus. This will include greater flexibilities, including holding AGMs online or postponing the meetings whilst the COVID-19 outbreak continues.

Company directors, company secretaries, people with significant control (PSC) and LLP members can apply to remove their personal addresses from the UK’s official company register at Companies House. 

Prior to the introduction of this law (in April 2018) it was only possible for a director to ask for their personal address to be "hidden" if they could demonstrate that they were at a serious personal risk of violence or intimidation.

Company directors and others are still required to provide an alternative correspondence address if they are appointed to a live company. If they are no longer appointed to a company, then an alternative address is not required and only the first half of their postcode will be made available to the public. 

There is a charge of £55 per document where a director wants to suppress their home address. The option to remove your home address from the public register is not available if the home address is the same as the company’s registered office address. 

During the COVID-19 outbreak, the quickest way to ensure your SR01 application is processed is to email a digital copy to Companies House. This will allow Companies House to process the application without delay. 

However, you must also send a completed paper SR01 and cheque or postal order (£55 per document listed) by post which will be processed in due course. Any applications processed by Companies House without receipt of the completed paper document or the correct fee may result in the redacted information being placed back onto the public register at a later date.

There are automatic late filing penalties which are designed to encourage companies to file their accounts and reports on time. All companies, private and public, large or small, trading or non-trading must send their accounts to Companies House.

Companies House is advising businesses to take appropriate measures to file on time. If, immediately before the filing deadline, it becomes apparent that accounts will not be filed on time due to your company being affected by Coronavirus (COVID-19), you may make an application to extend the period allowed for filing. You must apply for the extension before your filing deadline. The best way to file is online.

If you do not apply for an extension and your accounts have been filed late, an automatic penalty will be imposed. The registrar has limited discretion to cancel the collection of a penalty.

Companies House has stated that each appeal is treated on a case-by-case basis, and they already have policies in place to deal with appeals based upon unforeseen poor health. Appeals based upon COVID-19 will be considered under these policies.