You may have seen some publicity about the Companies Act 2006 which finally became fully effective on 1 October 2009, after 20 years in the making and three years in the implementation!
All companies will be affected to some extent, the key issues you are likely to find cropping up will be:
New Company Forms
If you have been submitting your own statutory forms to the Registrar you will notice they all changed on 1 October 2009. The reference numbers have moved from the rather obscure numerical system (based on the section of the 1985 Companies Act they reflected) to an alpha numeric system, which gives a clue to the contents, so the AP01 is used for Appointing a new director, and an AR01 will be an Annual Return.
Be careful with these forms for the first couple of months, you can only use the new ones for events which happen on of after 1 October – if you are making a late notification of something that happened earlier you should continue to use the old forms.
The Annual Return
From 1 October 2009 the Annual Return should only confirm information already held by Companies House. You cannot use the return to give notice of changes to:
- the company officers
- the registered office address
- the company type or
- information relating to the company records.
If the Registrar receives an Annual Return which is inconsistent with the information held on the record he will issue an inconsistency notice. The company has 21 days to respond before the notice is put onto the public record.
We would be happy to review your Annual Return to ensure the information is up to date.
Companies House is very keen for companies to submit all their returns on-line. The advantages of this are an instant response as evidence that you have made the return on time, and in many cases cheaper rates. An on-line Annual Return costs only £15 while a paper return is £30!
You can also sign up to PROOF (the secure protected on-line filing system) which reduce the risk of malicious or fraudulent filing by individuals wishing to hi-jack your company or destroy your credit.
We would be delighted to advise you about the benefits of on-line filing, or please call us to learn more about PROOF.
Company Records of Directors and Shareholders
You can now keep certain matters more private. For instance your directors do not have to put their personal residential addresses on to the public record (either in your Register of Directors, or at Companies House). You can now give the address of the company’s registered office instead, although their private addresses must still be recorded in a confidential Register of Directors Residential Addresses and Companies House still need to have the information in case it is required by regulatory authorities. Directors in sensitive occupations can also apply to have information previously filed removed from the record, although this is quite costly, at £140 per document!
Shareholders of private companies are also not required to give their residential addresses on the Annual Return; in fact a private company Annual Return with addresses will be returned by Companies House. You will still keep this information in the Share Register, but anyone seeking access must show a good reason why they want it (previously it was available on demand!)
We can advise you on the information you need to keep in the registers, or what to do if someone asks for access to your Share Register.
The new SAIL
As well as a Registered Office companies can now nominate a Single Alternative Inspection Location (SAIL) where it my keep some of the registers which are open to public inspection. Companies House needs to be notified of the SAIL, and the books that are kept there.
You may already keep some of your registers at an address other than your Registered Office. If so you will need to nominate this address as your SAIL after 1 October, 2009.
Contact us if you would like us to act as your Registered Office or be nominated as your SAIL.
New Model Articles
In future the company’s Constitution will be based on its Articles – the old Memorandum of Association has ceased to have any effect and any rules found in it are effectively transferred to the company’s Articles. In the Articles can be found all the rules, which govern the way the company can act and what the directors may do.
You may find your existing Articles full of out of date terminology and archaic references which don’t make a lot of sense in today’s markets and which don’t take advantage of the relaxations found in the new Act. Indeed if you have several companies in a group which were formed at different periods, they may all have different Constitutions to take into account.
You might wish to consider adopting the new Model Articles to take advantage of the new rules which allow you, for instance, to change the company name, or issue additional share capital without the trouble and expense of a company General meeting every time.
We can look at your current Constitution and advise you if it would be beneficial to adopt the new rules.
As well as benefits, the Act does contain penalties, the most notable of which are the penalties for the late submission of the Annual Accounts. The fees went up in February for all companies – private and public; and for returns under the 2006 Act can be doubled if a return is late in two consecutive years.
Let us know if you would like us to make returns for you and avoid the risk of incurring a penalty.
This is a short summary of the effects of a complex piece of legislation. Please contact us if you would like more information. We would be delighted to help you with any area of your statutory duties.