Company procedure update
18 / 10 / 2016
In the last few In Counsel updates we have repeatedly raised the changes to company law brought about by the new register of people with significant control (PSC Register) which came into force on 6 April 2016. However, the PSC Register regime is not the only change to the Companies Act 2006 brought about by the Small Business, Enterprise and Employment Act 2015. This note summarises two salient points.
With effect from 30 June 2016, the annual return has been replaced by a confirmation statement.
In a manner not dissimilar to the statement of capital brought about in 2006, a company can file a confirmation statement at any time and must do so within 14 days (previously 28 days) after the end of each review period. So, a worked example:
2016 annual return made up to – 31 March 2016
2016 annual return had to be filed by – 28 April 2016
2017 confirmation statement must be made up by – 31 March 2016
2017 confirmation statement must be filed by – 14 April 2017
A confirmation statement must, in any case, be filed within twelve months of the last statement. If, therefore, a company undertakes a number of corporate actions and decides to file a new confirmation statement on, for instance, 31 October 2016, the next confirmation statement will become due to be made up to 31 October 2017 and filed by 14 November 2017.
Remember that changes of address or name of directors need to be notified in any event; the law has not changed in that regard.
Note that the new confirmation statement form, especially when filing it for the first time, is a fairly long document and needs to include accurate PSC Register information, among other things. .
Striking off of companies
The Companies House strike off procedure has been accelerated. The process used to take a minimum of six months. However, since October 2015, notice periods have been reduced and the procedure will now be complete within four months.
The Registrar of Companies may take strike off action if he has reasonable cause to believe that a company is not carrying on business or in operation. This is often demonstrated by required filings not being made.
Failure to make filings on time (the most important of which are clearly the required filings for every company, i.e., annual reports and accounts and confirmation statement) continues to be an offence. Companies House is now very keen to improve the quality of information on the register and strike companies off for failures to file.
In order to strike off a company Companies House needs to send only two letters to the company and issue the required Gazette notices. The register will also show that the notices have been issued.
The mantra to follow: If you are a director, remember what you need to have filed and, as always, if Companies House writes to you, you need to pay attention.
For further information please contact Edward Craft at firstname.lastname@example.org.