By far the most common form of trading vehicle in the UK is the private limited company (LTD). In return for the limited liability protection that the LTD provides for its shareholders, there are a number of public filing responsibilities together with potential audit requirements.
An LTD can choose its own accounting reference date and it must file at Companies House, publicly available statutory accounts, within 9 months of the end of each accounting period.
There are financial penalties for late filing:
Penalties are doubled where a company files its accounts late for a second year. Continued non-filing of the accounts can lead to prosecution of the directors and striking-off of the company, with forfeiture of the company’s assets.
The time limits for the first filing may be different.
Companies that exceed certain thresholds below need an audit. These thresholds include all companies in the same corporate group, wherever they are in the world.
An audit is also required where the company, or another member of the group in which it is owned, is a public limited company or regulated by certain regulated bodies e.g. FCA, Solicitors Regulation Authority. An audit can also be forced at the decision of the members.
Please see Quick Guide ACC 5, entitled “UK Audit Requirements” for more detailed requirements.
Groups of companies that do not qualify as “small groups”, because they exceed two of the three limits below, must prepare and file consolidated accounts.
These limits have to be met in both the current and the preceding year.
The limits increased for accounting periods beginning on or after 1st January 2016 to:
The new limits can be adopted early for the purposes of determining company size but not requirement to audit.
In addition to filing financial information a LTD must also file an annual return detailing the directors, company secretary, shareholders and information about the shares and nature of the business.
This is filed each year on the anniversary of incorporation.
From June 2016 there is also a requirement to file a register of persons with significant control on public record.
There are obligations to notify changes in directorships, or directors’ personal details, changes in the company’s registered address, details of new shares issued or reductions in share capital as well as any changes in the Articles of Association.
Many of the regular submissions can now be made online at www.companieshouse.co.uk. This website also provides further information about filing requirements.
This note does not contain a full statement of the law and it does not constitute legal advice. Please seek legal advice if you have any questions about the information set out above.
Copyright © 2013 - Oury Clark.