PSC's for Ltd by Guarantee issue

New bank advising our Ltd by Guarantee client not to have Person of Significant Control's listed

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Hi fellow accountants! 

Please share your knowledge and advise on how myself and my colleagues can fix this situation for our client...

  • Ltd by guarantee client needs to switch banks and it taking them a long time, they have chosen Lloyd's to switch to 
  • Bank told them last month there should be no PSC's so the client removed this from Companies House. Lloyd's wont let them open the bank account without this being so. 
  • We received a letter from Companies House stating that there is nothing on the PSC regsiter and to fix this because the PSC regsiter cannot be blank
  • Client told me that Lloyds bank said on the phone "because there is no shareholding (or shouldn’t be a shareholding) there aren’t any PSCs. I tried to point out that the definition of a PSC is more than just shareholding (voting rights, influence over decisions, appointment /removal of Directors) but we ended up going around and around in circles so in the end I gave up. We first applied for this new account in March so I’m loathe to push too hard in case it delays things any further" 
  • We are trying to help them rectify this so that it is correct with Companies House but that they can also still get the bank account they need

Has anyone faced a similar situation before and how did you fix it?

TIA 

Replies (11)

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By WertyQ
21st Aug 2023 12:48

How many directors/trustees/board members are their? If more than 4 and they have equal rights, then arguably there could be no PSC as the rights would be under 25%.

If there are no PSC's, then the company has to declare this to Companies House. I have only ever done this when the company was set up, not after it had incorporated, but I think it is a tick box if you login as in to submit a confirmation statement.

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Replying to WertyQ:
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By rmillaree
21st Aug 2023 13:12

As wertyQ has advised
"If there are no PSC's, then the company has to declare this to Companies House"

Sounds like this has not been done - that statement should have been done at the same time (or as soon as request is processed) when last psc went - preesumingh you are happy there are no psc's !!!

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John Toon
By John Toon
21st Aug 2023 12:50

What Lloyds are saying appears to be something that ryhmes with rollocks. So I'd choose an alternative bank rather than messing up the company's register which affects things like their credit rating, for example.

I run a Co Ltd by Guarantee with 2 others. We're all directors and PSC's under the definitions.

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Replying to johnt27:
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By tom123
21st Aug 2023 13:47

Yes, but presumably you have 33% control, so 'over' the limit..

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Replying to tom123:
John Toon
By John Toon
21st Aug 2023 14:25

Just, by .33 recurrung ;)

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RLI
By lionofludesch
21st Aug 2023 13:29

I can barely believe what I'm reading. CH have challenged a filing ? They 've looked at it?

In the circs, I would probably go for one of two routes.

1. Do what the bank want, get their boxes ticked, get the account opened, then do what CH want.

2. Tell CH that the bank say they're wrong. CH will then say they aren't and you can pass that letter to the jobsworth in charge of your account.

I do agree, though, that you can't just leave the company with no PSCs. If there are none, you must specifically say so.

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Replying to lionofludesch:
John Toon
By John Toon
21st Aug 2023 13:41

An incomplete PSC register is an automatic reminder - just the same as the one for the filing of your accounts or CS01

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Replying to lionofludesch:
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By rmillaree
21st Aug 2023 13:49

As John Toon has advised this is an automatic naughty letter/reminder - the issue here is that the op hasnt properley updated the c house record

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By McQuarrieCloud
21st Aug 2023 14:04

Yes correct it was an automatic letter from CH to state the PSC's was now blank and suggested a series of forms to submit.

Originally when company set-up there was two PSC's stated but client's assistant changed this to remove them as bank told them there should be no PSC's. (Eeeek!) We are trying to sort the mess out.

There are two directors/ officers of the Ltd by Guarantee and unfortunately one person is overseas so difficult to set-up the bank. They just want to stick with Lloyds.

I'm checking with the client whether is should be 50/50 PSC's or of for the sake of the bank not understanding a PSC and shareholder are not the same thing, no PSC's in a some sort of statement.

Thanks for the comments so far. I think it has been such a frustrating situation for our client!

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Replying to McQuarrieCloud:
John Toon
By John Toon
21st Aug 2023 14:29

Assuming both the directors are the guarantors (it'll say in the incorporation docs) you definitely have a PSC or two. You may be able to argue the UK based director has a trump card over the overseas one but that's most likely going to be irrelevant to the overseas director issue that Lloyds will then fall back to as a cause for concern.

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Replying to johnt27:
John Toon
By John Toon
21st Aug 2023 14:38

Just to add to this - assuming you have an AML regulator you're obliged to report issues to CoHo where the PSC register is incorrect and doesn't reflect the reality of the situation.

So, if you did choose to satisfy the Lloyds requirement and it doesn't reflect the facts, you would then need to report the company to CoHo and they would then need to amend their PSC register, potentially back to what was shown originally before all this messing about started...

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