Company Health Check
As a company law agency we always check on the companies that we are working on to see if they are in order before commencing the work.
A high proportion are not compliant, and we have seen many instances of problems arising on the sale of a business or on investigations by HMRC.
Common scenarios include: –
- Shares being allotted and then ignored on all subsequent Confirmation Statements/Annual Returns and Accounts. These shares are issued and live but have not been reported so the company is non-compliant
- Shares allotted on a company with pre-2006 Companies Act Articles and exceeding the authorised share capital. The authorised share capital still exists on pre-2006 companies unless changed by Resolution
- Share restructures created by filing a form SH01 only, with no details of the rights. No resolutions no forms to reclassify and no amended Articles stating differential dividends or other rights
- Purchase of own shares dealt with by filing one form with no other paperwork. No resolution(s) or contract created/filed validating the transaction
- Reductions dealt with by one resolution only with no Companies House forms or statements of solvency
These are just a few scenarios and it’s quite common to see these mistakes. Companies House accept all documents in good faith and leave it to others to make a complaint.
Ramifications of non-compliance
- If a complaint is lodged then the company could receive a fine or prosecution
- The Directors are also liable for prosecution
- If the company is being sold it is always checked for compliance, so non-compliance could hold up the sale
- If HMRC investigates the company it could be a major issue if the company hasn’t got the correct wording to allow differential dividends
How can we help?
For a small fee of £15.00 + vat per company we will complete a full company Health Check and produce a Report.
This will include: –
- Review of the company from incorporation
- Review of the Articles (including the share capital)
- Ensure all paperwork for all events have been completed correctly and comply with company law
- We will also issue recommendations if the company is non-compliant
For companies over 20 years old it may be necessary to obtain a DVD history and so we will advise an extra fee of £25.00 for the registrars’ fee for the DVD.
To place an order or request more information please visit our website