Corporate transparency reforms: what comes next?

Last year, we reported on the impact of the Economic Crime and Corporate Transparency Act 2023 (the Act), which introduces the biggest changes to Companies House since corporate registrations were established in 1844.

Companies House has now issued a transition plan for implementation of the Act, summarising the changes which have already been brought into effect and laying out Companies House's timing expectations for implementation of the remaining updates, including those relating to identity verification.

Changes effected in 2024

In March 2024, under new powers granted by the Act, Companies House started the process of removing inaccurate information from the existing register; querying new information submitted to it; and analysing and sharing data with law enforcement agencies and other government departments. This work is expected to continue over a number of years.

In addition, since March 2024, companies have been obliged, either on incorporation or when filing their confirmation statements, to:

• provide a registered email address (which will not be shared on the public register) to allow Companies House to contact companies about matters relating to their filing quickly and efficiently, and

   

• confirm that the future activities of the company are lawful.

Identity verification

One of the major reforms still to be implemented is the requirement for all new and existing directors, people with significant control (PSCs) and persons submitting information to Companies House to verify their identity.  The transition plan states that more than 7 million people will need to go through these checks, which will require significant system development.

The current implementation plan for identity verification is as follows:

• Spring 2025: Companies House will start by allowing Trust and Company Service Providers (TCSPs) and other professional service providers who are registered with an anti-money laundering supervisor in the UK (such as the SRA or ICAEW) to register to become Authorised Corporate Service Providers (ACSPs).ACSPs will then be entitled to carry out identity verification services for their clients and to confirm their clients' verified status to Companies House.

Individuals will be able to voluntarily verify their identity before introduction of the compulsory identity verification requirements.

• Autumn 2025: Compulsory identity verification requirements for directors and PSCs on incorporation of a company, and for new director appointments or PSC notifications of existing companies, will commence by autumn 2025.
  
  Identity verification for existing directors and PSCs will be required at the time of the relevant company's next confirmation statement over a 12-month transition period.

• Spring 2026: Identity verification for people filing documents with Companies House should be implemented by spring 2026. Third party agents filing on behalf of companies will need to be registered as an ACSP.

   

• End of 2026: By the end of 2026, the transition period for all individuals on the register requiring identity verification should be complete and Companies House will start compliance activity against those who have failed to verify their identity.

Other upcoming changes

By the end of 2026, Companies House are expecting to require all limited partnerships to submit more information and to be in a position to facilitate greater cross-checking of information and data between Companies House and other public and private sector bodies.

Beyond that, there will be further changes relating to filing accounts and corporate directors.

Accounts

The following changes will be implemented:

• Annual accounts will have to be filed electronically.

   

• The option for small companies and micro-businesses to file abridged accounts will be removed.

   

• All companies will be required to file profit and loss accounts (and small companies will have to file their directors' report).

   

• A company claiming an audit exemption will need to provide an enhanced statement from the directors on the balance sheet.

   

• Companies will be limited in how many times they can shorten their accounting reference period.

Corporate directors

Any corporate director of a company will be required to have an all-natural person board and all directors of a corporate director will be required to verify their identity in order for the corporate director to be registered. 

Additionally, overseas companies will be prohibited from acting as corporate directors.