Companies House rings the changes
On 30 June some important changes are being made to the filing regime for small companies.
The best known move is the replacement of annual returns with confirmation statements. But other measures are being introduced that affect recurring compliance work and the formation of new firms.
These changes are part of the phased introduction of the Small Business, Enterprise and Employment Act 2015. The new measures, affecting both companies and LLPs, are explored below.
Annual Returns and Statements of Capital
Annual Returns will not be required for made up dates of 30 June or later, with firms instead required to file a confirmation statement (see here for more details). Companies House is introducing a new form (CS01) containing the declaration that records held by the registrar are correct on the confirmation date. There will also be optional “additional information” pages to submit any changes to certain information such as people with significant control (PSCs).
Some firms will still need to deliver annual returns with made up dates prior to 30 June after the switchover date. These annual returns will be affected by another change - a simplification of the statement of capital rules. Statements of capital will no longer itemise amounts paid and unpaid for each class of share. Instead unpaid share capital (if any) will only be reported in aggregate form for each currency.
Firms delivering annual returns on or after 30 June will need to follow these new rules, regardless of the made up date on the return. Companies House is introducing a new version of the form - AR01 2015 v9 - for these specific cases.
Other forms (such as the SH01) requiring a statement of capital will also be amended to reflect these new rules.
As from 30 June firms have the option of holding one or more of their statutory registers at Companies House.
Firms wishing to take advantage of this new right will need to inform Companies House using forms EH01 to EH05. If a firm elects to keep its registers of directors, directors’ residential addresses or secretaries with the registrar, the initial entries will be created automatically using Companies House data when the election form is received.
For the PSC Register, the firm will need to send a confirmation statement, including the PSC details, along with the election form. And the election form for the members’ register includes boxes to inform Companies House of shareholder details.
These registers need to be maintained, and must be up to date before a confirmation statement is filed. If the registers of members and/or PSCs are kept at Companies House, any changes will not need to be reported on subsequent confirmation statements.
Formation of New Firms
The incorporation process for new entities is also being changed.
Companies House is introducing a new version of form IN01 for paper based incorporation, while those using online formation services should expect to be asked for additional information to comply with the new rules.
Any request for incorporation on or after 30 June will need to be accompanied by details of PSCs, and the reason why each is classified as a PSC. New entities will also need to disclose at least one (and up to four) SIC codes to describe the firm’s principal activity, something not previously required at the time of incorporation.
The new entity can also opt to keep some or all of its statutory registers at Companies House. The initial information for these registers will be created automatically using the data contained in the incorporation request.
Fees are being reduced for electronic incorporations - from £15 to £12 for the Companies House web Incorporation service, and from £13 to £10 for those submitted using third party software.
While these new rules are not overly complicated, they represent more changes accountants need to be aware of and potentially explain to clients.
Further changes are in the pipeline - corporate directors are due to be abolished in October of this year, and the electronic delivery of LLP accounts is also in the pipeline. And the good news is the fees charged by Companies House continue to creep downwards.
Matt Bailey is the founder of cloud-based tax and accounts system Gbooks.