Had a new client come to me in June. Her accounts should have been filed by 31.12.2014 with Co House.
Her books were with her accountant who had become seriously ill anyway long story short she didn't want to add to his
Problems so had just got her books back from him.
I filed the late accounts along with 31.03.2015 on 10th July.
However today we have recived a summons taking client to court for failure to file by due date.
The statement was done on 2nd July showing they had t been filed but papers only issued now after filing is up to date.
She has never filed late before in 8 years of trading so concerned why they are seeking to prosecute her, I know they were late
But I have seen clients with several years missing and all that happened was they paid the fine and that was it.
She is only 6 months late so unsure why they have taking this stance with her or are Co House now taking a much tougher
Stance to drum up extra cash from small businesses
As anyone else had this problem.
Replies (25)
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Client needs legal advice not accountancy advice, which I assume she is getting.
Companies House always threaten that their ultimate sanction is prosecution - quite reasonably so. But it's a new one on me that they can prosecute for an "offence" of having filed late (if indeed it is an offence at all) rather than failure to file at all (which is of course an offence).
So the client needs to ask her solicitor what to do.
Only ever
seen this once before, an awful long time ago, probably pre late filing penalty regime. Think the director was fined something like £25-£50. From memory it was in the Cardiff magistrates court.
Be very interested if this was a new stance being taken by Companies House.
Edit, just found this:-
As a last resort, directors can face prosecution for violating the rules. Companies House will prosecute directors who fail to file their accounts if they think its in the best interest of the public, and if there is sufficient evidence that the company was still “live” at the time of the offence. Nearly 2,000 directors were prosecuted for failing to produce accounts on time by Companies House last financial year, which prioritises resources to focus on offences where there has been persistent, repeated and willful non-compliance.
http://economia.icaew.com/business/april-2014/companies-late-filings
Resolution
The offence is failure to file accounts by 31.12.2014
I think that he means they now have the accounts - what resolution are they hoping for? Surely the just levy the penalty and go away?
Appeal
Tell her to appeal to Co House. If they had begun action just before the accounts were filed it may well be that the action gained momentum and had not taken the filed counts into consideration. I have always found Co House to be understanding, if a little slow, so it is certainly worth a phone call followed by written explanation if necessary.
Be interesting to know if this was a "first offence" or if there was a history of late filings in the past. It's a bit worrying if they're applying such a draconian response for a first late filing.
Answer is in the question
Be interesting to know if this was a "first offence" or if there was a history of late filings in the past. It's a bit worrying if they're applying such a draconian response for a first late filing.
OP states that this is first late filing
The main problem is this I
The main problem is this I believe this is a criminal offence and she will have a record if found guilty
David am I right??! ( I hope not)
Criminal offence
I suggest the client or accountant or solicitor write to Companies House pointing out that the accounts are now up to date, there has been no previous default, explaining the circumstances & saying directors took all reasonable steps to have accounts filed on time.
Then see if CH will stop the prosecution.
David
She would have received personally several reminders from Cos house containing the warning about prosecution unless she filed and offering her the chance of more time. Why did she ignore them ?
Maybe
she spoke to them throughout and explained the problem she had.
Maybe that was her mistake?
My experience, based purely on observation and no scientific basis I hasten to add, is that HMRC seem a lot stricter on people who arrange a time to pay arrangement and then miss one instalment, than they are with people who don't bother to contact them in the first place and who make no payments at all. Maybe Co House is working in a similar way?
only three months late
There are thousands of cases where clients have not filed at all They should go after them instead of wasting time for someone who filed which was only three months late and there were extenuating circumstances too. Makes me very angry. Just a waste of tax payers money. .
The penalties are incurred when you file late for the "crime" of filing late - until then there is no fine
Also until you file Cos House don't know whether the co is trading or dormant so can't tell if it's worth chasing
Civil / criminal
The penalties are incurred when you file late for the "crime" of filing late - until then there is no fine
Also until you file Cos House don't know whether the co is trading or dormant so can't tell if it's worth chasing
This are the civil penalties levied automatically against the companies. But they are not what this thread is about. This thread is about an attempt by Companies House to have the court levy criminal penalties against the directors.
Register
The only thing i can think is that, whilst the accounts have been submitted, they may not actually have made it onto the register?
Are they in the filing history for said client?
Because, obviously, this would result in Companies House believing - incorrectly or otherwise - that the accounts had not yet been filed
Don't envy the situation
but would be interested in knowing how this turns out - if you feel obliged to share?
I have just picked up a new client - similar situation - they have also mentioned 'suspending prosecution if filed within 28 days' etc etc.
As far as I know, first 'offence' - seems heavy handed.