The Economic Crime and Corporate Transparency Act 2023 - getting ready for compliance

In force

• Powers to query information: The registrar now has expanded powers to query and challenge information that seems incorrect or inconsistent, remove inaccurate, incomplete, false, or fraudulent information more swiftly, use annotations on the register to highlight potential issues with supplied information and clean up the register by identifying and removing inaccurate data.
  
• Company name checks: Companies House can now reject an application to register a name where they have reason to believe the name is intended to facilitate fraud, the name is comprised of, or contains, a computer code, or where the name is likely to give the false impression the company is connected to a foreign government, or an international organisation, whose members include two or more countries or territories (or their governments). Companies House can also direct companies to change their name in some circumstances.
• Lawful purpose statements: A new requirement has been introduced for company incorporations, where the subscribers must confirm the company is being formed for a lawful purpose. Additionally, companies must affirm that their intended future activities are lawful in their annual confirmation statement on an annual basis. Find further information on what constitutes a lawful purpose and what steps you can take to support the making of the statement.
• Registered office address: ECCTA introduces stringent rules for registered office addresses, mandating that companies must maintain an 'appropriate address' at all times. An 'appropriate address' is defined as one where a document can be expected to reach a company representative when delivered by hand or post and where the delivery of documents can be recorded through an acknowledgement of delivery. Companies may no longer use a PO Box address as a registered office address.
• Registered email address: All companies need to provide a registered email address for Companies House to use to communicate with the company. It will not be available on the public record. Existing companies will need to provide the email address when filing their first confirmation statement from 5 March 2024 onwards.
• Investigation, enforcement and data sharing: Companies House has new investigation and enforcement powers and new powers to share data with law enforcement agencies and other government departments.

Coming into force in future:

• Expected spring 2026: Filing documents with the registrar: Once in force, an individual can only deliver documents to the registrar on their own behalf or on behalf of a company if they are ID-verified or an ACSP. The registration process for ACSPs will commence on 18 March 2025.
  
• Expected in future: Corporate directors: Corporate directors will only be able to be appointed where they are UK corporate entities with ‘legal personality’ and where the directors of the corporate directors are natural persons.
• Expected in future: Improving transparency of company ownership: Companies will be required to record the full names of shareholders who are individuals and the full names of corporate members and firms in their registers. Companies will also be required to provide a one-off full shareholder list to Companies House. The conditions will allow a relevant legal entity to be recorded as a person with significant control (PSC) will be collected and displayed, as well as reasons for exemption from providing PSC details where relevant.
• Expected 2025: Protecting personal information: From January 2025, individuals will be able to suppress their residential address from historical documents where it was the registered office address. From spring/summer 2025, further personal details can be suppressed from historical documents such as residential addresses, day of birth, business occupation and signatures. Evidence will not be required and suppression will be automatic. Protection will also be offered for those at risk of harm by concealing sensitive information like names and addresses.
  

• Expected Autumn 2025: Individuals who are directors, individuals who are registrable PSCs, relevant officers of registrable relevant legal entities, any individual who is an authorised corporate service provider and individuals delivering documents to Companies House will be required to have their identity verified. It is expected that IDV will be required from Autumn 2025 on incorporation, with a 12 month transition period to follow to require IDV for existing directors and PSCs. Voluntary IDV will open on 8 April 2025.
  

• Expected Winter 2026: Limited Partnerships will need to file more information with Companies House such as submission of an annual confirmation statement, notification of changes to the LP and its partners and the need for registered officers and named contacts of GPs to be notified. In addition, Limited Partnerships will need to use an Authorised Corporate Service Provider (ACSP) to make filings at Companies House on their behalf. It will not be possible for Limited Partnerships to make their own filings.
  
  Find out more about how we can support the Limited Partnerships in your structure.
  

• Expected in future: Software-only accounts filing: Companies House will transition to filing accounts by software only in digital format. Paper filing options will no longer be available. This will mean that accounts must be filed digitally in fully tagged iXBRL format, therefore companies should review their timelines to ensure accounts are tagged in advance of the Companies House filing deadline.
  
  Companies House are also expected to release a new ‘File My Package Accounts’ service from January 2025 to allow package accounts to be filed digitally, firstly for UK Single Electronic Format accounts and Welsh dual submission, followed by limited partnerships and group package accounts. It is expected that this service will be expanded in April 2025 for audit exempt, filing exempt and Community Interest Company packages, with Overseas Companies to follow in future. Accounts will be required to be iXBRL tagged and in zip file format.
• Expected in future: Changes to small and micro-entity company accounts filings: Small and micro-entity companies will need to file their profit and loss accounts. Small companies that do not qualify as micro-entities will also need to file a directors’ report. The option to file abridged accounts will be no longer be available.
  
• Expected in future: Audit exemption: Companies will need to include an additional statement on the balance sheet to confirm which audit exemption is being claimed and to confirm that the company qualifies for the exemption.
  
  Read more about how we can help with preparation of and filing of accounts.
  

• Expected Autumn 2025: Where fraud offences occur that are committed by an organisation or its associates where the organisation benefits, it can now be prosecuted. Fraud offences may include: false representation; failing to disclose information; abuse of position; obtaining services dishonestly; participation in a fraudulent business; false statements by directors; false accounting; fraudulent trading; and cheating the public revenue. The new offence applies widely to Incorporated organisations meeting the criteria of a ‘large company’ under the Companies Act 2006. A defence is available of having reasonable fraud prevention procedures in place, with the Home Office providing guidance around what constitutes reasonable procedures. Guidance was issued on 6 November 2024, with organisations having until 1 September 2025 to comply.
  

• ECCTA expands the scope of the identity doctrine for economic crime offences by bringing senior managers within scope of who can be considered the "directing mind and will" of a business. If a senior manager of a body corporate or partnership, acting within the actual or apparent scope of their authority, commits or attempts to commit a "relevant offence" after the section comes into force, the organisation is also guilty of the offence.