Companies House are implementing major rule changes stemming from the Economic Crime and Corporate Transparency Act 2023 (ECCTA), with key dates and timelines stretching from Autumn 2025 to 2027.
In this article we take a look at these future changes and the timescale (where it has been confirmed).
Companies House identity checks
The future changes come on the heels of requirements already introduced which tightened Companies House Identity Verification procedures.
Since 8 April individuals have been able to voluntarily verify their identity with Companies House. By Autumn 2025, this verification will become mandatory for new directors and Persons with Significant Control (PSCs) upon incorporation or appointment.
You can read our previous article about Companies House Identity Verification procedures here.
Corporate director restrictions
Whilst no date has been confirmed, it is expected that from Autumn 2025, UK companies will be allowed only one corporate director, and only if:
- The corporate director is a UK entity with legal personality.
- All directors of that entity are natural persons who have completed identity verification.
Foreign corporate directors will no longer be permitted.
Transition to digital filing
Companies House is closing its web and paper-based systems for account filings on 1 April 2027 and is making a transition to digital filing.
Online services to file other documents, for example confirmation statements and director updates will not be affected by this change.
If you already file your accounts using software, you do not need to take any action and if you don’t, you have plenty of time to prepare.
Accounting reform
Profit & Loss (P&L) Accounts to Become Public
Currently scheduled from 1 April 2027:
- Small and micro-entity companies will not be able to file abridged or filleted accounts.
- All companies must file full accounts including balance sheet and P&L account.
- Small companies will be required to include a directors’ report (micro-entities are exempt).
- Companies will only be able to shorten their accounting period once every five years unless there is a valid business case.
Companies House says that other changes are planned, including updates to audit exemptions – and that they will share more information about these in the coming months.
Our thoughts
Any measures which will improve the accuracy and quality of data on the register, speed up processing times and help Companies House detect and prevent fraud more effectively are clearly welcome.
The requirement for all companies to file P&L accounts which will be publicly visible is of some concern.
Companies House say the move is intended to increase transparency and reduce fraud, but in reality, it could have the potential to harm smaller businesses for example by exposing sensitive financial information to competitors.
What can your business do now?
- If you don’t already file your accounts electronically then now is a good time to review your filing process and software setup.
- Prepare directors for Identity Verification.
- If you are a small or micro company start planning for full P&L disclosure.
If you need any advice please get in touch at enquiries@cowgills.co.uk
