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The Annual Return is Changing to The Confirmation Statement
by Startacus Admin
The Annual Return is changing to the Confirmation Statement. Here’s what you need to know.
Big changes ahead. On 30th June the good old Annual Return is having a face-lift and will reemerge as the Confirmation Statement. This is all part of The Small Business, Enterprise and Employment Act. Here we’re going to take a quick look at what is changing, what isn’t changing and how all this will impact limited companies across the country.
Well firstly, as we’ve already touched on, the name is changing from the Annual Return to the Confirmation Statement. This is a good thing as it will (hopefully) kill off any confusion between a company’s Annual Returns and Annual Accounts - something that has no doubt cost quite a few companies quite a few pounds (whilst late filing of Annual Returns has no real implications for company directors, late filing of Annual Accounts can result in a penalty of up to £1,500).
Next up is the information that’s actually included within the Confirmation Statement. The report will still include registered office, director, shareholder and share capital information, but now it will also contain information about ‘People with significant control’ - or PSC - in the company, these being (according to the government) anyone in the company who:
owns more than 25% of the company’s shares
holds more than 25% of the company’s voting rights
holds the right to appoint or remove the majority of directors
has the right to, or actually exercises significant influence or control
holds the right to exercise or actually exercises significant control over a trust or company that meets one of the first 4 conditions.
Now here’s the big change. At the moment company directors must prepare and file Annual Returns once a year, the fee for doing this is £13. If a change were to occur in the company, a shareholding update for example, the directors could pay £13 and file another Annual Return or they could simply wait until the next Annual Return is due. From 30th June once a company has filed its Confirmation Statement and paid the £13 filing fee (this has not been confirmed but the fee is expected to stay at £13), it can file as many more Confirmation Statements within the year as the directors wish - at no cost at all.
As it currently stands, a company could file an Annual Return on a Monday and then make a change to the company on Tuesday - the information held at Companies House (the UK’s registrar of companies) would then be out of date for the rest of the year. On 30th June company directors could file a new Confirmation Statement on the Tuesday detailing the update, at no extra cost to them if they’ve already filed that year’s Confirmation Statement. The due date of the next Confirmation Statement would then be one year on from when the last Confirmation Statement was filed.
What’s not changing?
Like the Annual Return, the Confirmation Statement will still be a compulsory filing obligation for all UK limited companies, regardless of if they’re trading or dormant. For new companies the due date will still fall 1 year and 28 days after incorporation, for existing companies the Confirmation Statement due date will simply take the Annual Return due date.
Finally, whilst the ‘check and confirm’ message behind the Confirmation Statement may be new, the way it will work is largely the same; company directors need to look over the company information that Companies House currently hold and confirm if it’s correct or make any necessary changes.
In all, the changes don’t represent a major shift for business owners, the emergence of a new section in the document (PSC) is no real hassle and the ability to file free Confirmation Statements is, well, nice. The government / Companies House on the other hand are happy because the information that they hold for limited companies is more likely to be up-to-date and correct.
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