[24.01.24]

October 2023 saw the passing of the Economic Crime and Corporate Transparency Act.  The Government is aiming to introduce the first set of changes on 4 March 2024. The introduction of these changes needs secondary legislation so this date is still dependent on Parliamentary timetables. However, the changes are expected to include:

• greater powers to query information and request supporting evidence
• stronger checks on company names
• new rules for registered office addresses
• a requirement for all companies to supply a registered email address
• a requirement for all companies to confirm they’re forming the company for a lawful purpose when they incorporate, and to confirm its intended future activities will be lawful on their confirmation statement
• the ability to annotate the register when information appears confusing or misleading
• taking steps to clean up the register, using data matching to identify and remove inaccurate information
• sharing data with other government departments and law enforcement agencies

Additional future changes will also include the requirement for companies to use software to provide their accounts. There will also be a requirement for small and micro-entities to provide a profit and loss account as part of their accounts.  Companies House classifies a small company as satisfying two of the following: either having a turnover of £10.2million or less, £5.1million or less on its balance sheet, or having 50 employees or fewer.   Whilst a micro-entity has two of the following criteria: a turnover of £632,000 or less, £316,000 or less on its balance sheet, or 10 employees or fewer.   The changes will also require small companies to provide a Director’s Report as part of their accounts.  Companies House has not yet set out when these changes will come into effect.  However, we are expecting them to start later this year.  As we learn more about the timing of these changes, we will inform clients.

In the meantime, here is some detail on the key changes which are expected to be implemented from 4th March 2024:

New rules for registered office addresses

From 4 March 2024, there’ll be new rules for registered office addresses which mean companies must have an ‘appropriate address’ as their registered office at all times. An appropriate address is one where:

• any documents sent to the registered office should be expected to come to the attention of a person acting on behalf of the company
• any documents sent to that address can be recorded by an acknowledgement of delivery

These changes mean you will not be able to use a PO Box as your registered office address from 4 March 2024. You can still use a third-party agent’s address if they meet the conditions for an appropriate address.

Companies that do not have an appropriate registered office address could be struck off the register. When Companies House identifies an inappropriate registered office address, they will change it to a default address held at Companies House. The company must then provide an appropriate address, with evidence of a link to that address, within 28 days.

Registered email address

From 4 March 2024, there will be a new requirement for all companies to provide a registered email address to Companies House. This email address will not be published on the public register.  New companies will need to give a registered email address when they incorporate. Existing companies will need to give a registered email address when they file their next confirmation statement with a statement date from 5 March 2024.

Companies House will use this email address to communicate with you about your company.

Statement of lawful purpose

When you incorporate a company from 4 March 2024, the shareholders will need to confirm they’re forming the company for a lawful purpose.  You will also need to confirm the company’s intended future activities are lawful on the confirmation statement.

Castletons Accountants