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Keep good company

The Economic Crime and Corporate Transparency Act (“ECCTA”) received royal assent on 26 October 2023. Make sure you keep good company!

“The act introduces the biggest changes to Companies House since corporate registrations were established in 1844.
We’ll have the power to play a far more significant role in tackling economic crime, supporting economic growth, and making sure the UK is one of the best places in the world to start and grow a business.“
Companies House

What’s going on?

Continuing the drive for greater transparency of who is running a UK company and trying to toughen up the law to better deal with economic crime, the ECCTA has been passed and gradually its provisions will be rolled out.

This Companies House video explains the changes ahead:

Confirmation statement changes

From March 5 all companies will need to provide a registered email address. Companies House will use this email address to communicate with the company – it will not be available to the public.

All companies will need to confirm that the intended future activities of the company will be lawful.

You’ll need to confirm this every year on the confirmation statement. You will not be able to file a confirmation statement without this statement.

Companies House Fees

All fees are rising and the one you’ll be most affected by is that the fee for filing your confirmation statement will rise from £13 to £34.

Don’t tell the Bank of England about this 161% price rise or interest rates will never come down!

Identity verification

Coming soon.

Companies House will introduce a new identity verification process to help deter those wishing to use companies for illegal purposes.

Companies House will put in place a service to verify your identity using ID documents, such as a passport. There will be a range of support and services available to help you complete this process.

Every company will have to file a P&L at Companies House

This is the big change that’s coming which a lot of smaller companies are probably not going to like. Everyone will be able to see your turnover, profit and how much tax is charged on that profit.

Euphemistically, Companies House describe the change as “We’re streamlining the accounts filing options for small and micro-entity companies.”

The detail of what the P&L will need to include will be set out in secondary legislation.

Now, your company already has to produce a P&L as part of its full accounts and it goes to the shareholders and to HMRC along with your corporation tax return. So there shouldn’t be any extra work involved.

However, we all need to anticipate the change because accounts always contain a comparative column with last year’s numbers in it. So, in the first year in which you HAVE to disclose your P&L under the new rules, you’ll most likely also have to show last year as well, even though it wasn’t published at the time.

I think we can confidently say that rolling out this change will be left for the next UK government.

Also look forward to an explosion of direct marketing as databases will, for the first time, be able to include accurate turnover data. Unsubscribe will be your new best friend!