This month Gordon is featured on Flat Living’s website talking about the some of the notable changes that have recently come into force for UK companies following The Small Business, Enterprise and Employment Act receiving Royal Assent back in March 2015.
The Confirmation Statement
The Annual Return that used to be submitted each year by all companies (including Residents’ Management Companies) has now been replaced by a “Confirmation Statement”. To complete the Confirmation Statement, company directors will need to check the information held for their company at Companies House at least annually. This change was introduced in June 2016.
People with Significant Control (PSCs)
June 2016 was also the first time that companies were required to notify Companies House of “People with Significant Control” (PSCs). From 6 April 2016, companies have been required to keep a PSC Register. The definition of a PSC can be found at Companies House. However, to summarise, it includes anyone who owns more than 25% of the shares or voting rights of the company or has the right to “exert significant influence” on the company or can control the Board of the company.
Companies have an obligation to investigate PSCs and to keep the information up to date. Failure to do so will be a criminal offence by both the company and its officers. For existing companies, the information needs to be provided in the first Confirmation Statement. Companies House will issue companies with a reminder letter or e mail alert when their first Confirmation Statement is due. Further information can be found on the Companies House website.
Up to October 2016 it was possible for companies to have a corporate director as long as one of the directors of the corporate body was a natural person. As part of the Government’s response to the G20 commitment to increase corporate transparency, from October 2016 only a natural person can be a director of a company subject to certain exemptions. These exemptions are proving to be difficult to finalise and as a result of this the Companies House website states that the exemptions “are still under development”. However, for the majority of companies these exemptions are unlikely to apply and directors should prepare now for the change and the final implementation date. Company officers need to be aware of the following;
- No new corporate directors can be appointed from the implementation date.
- Existing corporate directors will have a 12 month window to be removed as director or replaced by a natural person.
- Any corporate director still in position 12 months after the implementation date will automatically cease to be a director.
Failure to comply with the new legislation will be a criminal offence punishable by a fine on either the company, its officers or the corporate director.
A full copy of the article can also be viewed on Flat Living’s website http://www.flat-living.co.uk/advice/1479-companies-house-major-changes-for-uk-companies . If you have any questions regarding the contents of this article or indeed about any matter relating to service charge accounting please feel free to give us a call on 02380 276323.
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