The UK business landscape is set for significant regulatory changes with the upcoming reforms to Companies House. These measures, introduced under the Economic Crime and Corporate Transparency Act 2023, are designed to enhance transparency, reduce fraudulent activities, and strengthen the accuracy of corporate records. With the first wave of changes already in motion since March 2024, businesses must prepare for the new compliance requirements that will continue to roll out through 2027.

Key Changes and Implementation Timeline

From 25 February 2025, Companies House will begin removing fraudulent or non-compliant entities from the register. This means businesses must ensure all their registered details are accurate and verifiable. Additionally, firms providing corporate registration services will need to register as Authorised Corporate Service Providers (ACSPs) and comply with stricter regulatory oversight.

By March 2025, identity verification will become available on a voluntary basis for company directors and persons with significant control (PSCs). However, by Autumn 2025, this verification process will become mandatory for all new company incorporations and newly appointed directors. Existing directors and PSCs will have until 2026 to comply.

Companies House will also introduce new restrictions on misleading company names and inaccurate business descriptions, helping to prevent deceptive business practices. Furthermore, access to specific information from the Register of Overseas Entities will be expanded, improving corporate transparency.

How These Reforms Will Affect Businesses

Increased Compliance Requirements

Businesses will need to verify their directors and PSCs, maintain accurate records, and ensure all filings meet the new standards. Failure to comply could result in penalties, removal from the register, or being flagged for further scrutiny.

Higher Operational Costs

The reforms will introduce additional administrative tasks and compliance checks, which could lead to increased costs for businesses, particularly for smaller firms that may lack dedicated compliance teams. Companies House has already raised its filing fees, and further increases may follow.

Stricter Identity Verification

Companies will no longer be able to appoint anonymous or falsely declared directors. The verification process will require official documentation, and in many cases, professional service providers will have to carry out identity checks on behalf of their clients.

Greater Accountability for Accountants and Corporate Service Providers

Accountants, tax advisors, and corporate service providers must be aware of their new responsibilities under the ACSP registration rules. Firms that offer company formation services will be required to meet specific criteria and comply with anti-money laundering regulations.

Preparing for the Changes

Businesses should take proactive steps to ensure compliance with the new Companies House regulations. This includes:

Reviewing and updating company records to ensure all information is accurate.
Preparing for identity verification requirements by collecting the necessary documentation.
Consulting with accountants and legal advisors to understand the full implications of the changes.
Staying informed about upcoming deadlines and making adjustments in advance to avoid penalties.

While these reforms may bring additional compliance burdens, they are a necessary step in improving corporate transparency and reducing economic crime in the UK. Companies that stay ahead of the curve and implement these changes proactively will benefit from a more secure and reputable business environment.

At FZCO Accountants Limited, we help businesses to deal with complex regulatory requirements and ensure full compliance with evolving legal standards. If you need assistance with your Companies House filings or understanding how these reforms impact your company, contact us today.

Companies House Reforms