As well as filing accounts with Companies House, there is a further requirement to check that the information Companies House holds about your company is correct every year. This is facilitated by the filing of an annual company confirmation statement. The confirmation statement was introduced in June 2016 and replaced the annual return form.
A confirmation statement must usually be filed at Companies House once every 12 months and rather than resubmitting data every year, the confirmation statement only needs to be updated if you have changes to report. If there are no changes then you just need to confirm the information is correct and submit the statement.
The following details need to be checked:
- the details of your registered office, directors, secretary and the address where you keep your records
- your statement of capital and shareholder information if your company has shares
- your SIC code (the number that identifies what your company does)
- your register of 'people with significant control' (PSC)
Any necessary updates to the statement of capital, shareholder information and SIC codes can be made when submitting the confirmation statement. However, the confirmation statement cannot be used to report changes to your company’s officers, the registered office address, the address where you keep your records and people with significant control. These changes must be filed separately with Companies House and this should be done at the same time or prior to submitting the confirmation statement. The confirmation statement can be filed online (at a cost of £13) or by post (at a cost of £40).
A surprising amount of free information about companies is available from Companies House. This is in line with the government’s commitment to free data and ensures that all publicly available digital data held on the UK register of companies is accessible free of charge. These records provide access to over 170 million digital records on companies and directors.
- company information, for example registered address and date of incorporation
- current and resigned officers
- document images
- mortgage charge data
- previous company names
- insolvency information
Interested parties can also set up a free alert service at Companies House that allows you to receive email alerts of company transactions. The alert tells you instantly what’s been filed as soon as it’s been accepted. Clients can also follow their own company listings to ensure that no untoward filings are made.
A Close Company is broadly defined as a company that is controlled by:
- five or fewer participators or
- any number of participators who are also directors or
- where more than half the assets would be distributed to five or fewer participators, or to participators who are directors, in the event of the winding up of the company.
A participator is broadly somebody who has a share or interest in the capital or income of a company, such as having share capital, voting rights or a right to capital on winding up of the company. This can be a shareholder, director or a loan creditor.
Most small private companies will meet the definition of a Close Company and there are some specific tax rules that apply to these companies, for example, where a close company pays for personal expenses of a director, or makes a loan to one of its participators.
Limited Liability Partnerships (LLPs) retain the flexibility of a partnership with the added advantage that a partners personal liability is limited. At least two members must be ‘designated members’ and the law places extra responsibilities on them.
For Capital Gains Tax purposes, the transfer of a business from a partnership to a LLP will not constitute a disposal by the partners of their interests in the original partnership’s assets unless their fractional interests in partnership assets are changed as a result of the transfer.
In addition, the transfer to an LLP of a partner’s rights to an annuity and/or the transfer of obligations to former partners in respect of annuities will, not be regarded as a chargeable disposal by the original partnership provided that the rights remain substantially the same.
The formation of an LLP is generally more complex and costly than that of a conventional partnership. Problems can still arise when there are disagreements between the members. There is also the prospect of paying more tax on high profits than for companies.