The Old Annual Return is History. Meet the New Confirmation Statement.

Thursday July 14, 2016

From the 30th of June, confirmation statements are replacing the old annual return. Here's what you need to know.

As any seasoned RIFT Warrior will tell you, you need to be quick on your feet to stay ahead of the ever-changing rules of doing business. Right now, there's a big change coming in the way companies have to account for themselves, and it's going to catch a lot of people out if they aren't on their toes.

Up until now, if you're running a Limited Company or Limited Liability Partnership, you've been used to sending annual returns to Companies House. As of the 30th of June, the old annual return is becoming extinct. In its place, there's a new beast stalking the business jungle, and its name is the confirmation statement.

Everybody still calm so far? Good. There's no need to panic, but there's every reason to get prepared.

What Is A Confirmation Statement?

The confirmation statement is closely related to the creature it evolved from, and it's going to serve most of the same purposes as the antiquated annual return. You'll have to file it at least once a year, but you can actually do it more often if you need to. This might be important to know for a lot of RIFT Residents, who tend to swim in the faster currents of small business.

A word of warning, though. You do need to hit that once-a-year minimum. The last thing you want is for the registrar to decide you're no longer in business and strike your company off the register. If you're still operating when you've been struck off, you could be staring down the barrel of a criminal prosecution. The old 28-day "grace period" for filing is getting hacked down to 14 days, too - so don't get caught out.

Most of the information you'll be sending is the same as the old annual returns. Companies House will still want to know where your registered office is, who your Directors and Shareholders are and so on. There's an important distinction to draw, though. Instead of treating the statement like a snapshot of your business at a specific moment in time, the confirmation statement is more a case of checking and confirming the information being held about you is still correct. It's less of a frozen moment captured and more of a continuously updated overview. Whenever something changes, you can update your statement without waiting for a full year to have passed since the last one.

The New Register of People With Signifcant Control

One new detail to watch out for is the register of People with Significant Control (PSCs). You're basically going to have to keep track of, and account for, everyone who:

  • Holds over 25% of the shares or voting rights, even indirectly.
  • Has the power to appoint or remove a majority of Directors.
  • Can make big decisions for the company.

What Is a Statement Of Capital

If your company has share capital, you'll also need to file a statement of capital. This needs to show things like:

  • The total number of shares.
  • The full face value of those shares.
  • Any amount unpaid on those shares.

This can all get messy quickly if you aren't used to dealing with "aggregate nominal values" and "prescribed particulars of rights attached". The details matter, though, so it's worth taking the time to get them right.

What Is The Cost of Filing Confirmation Statements?

There's some good news to chew on while you're choking down all the nasty stuff. It doesn't matter how many times you update your confirmation statement over the course of the year, you'll still only pay for it annually. The price is the same as the annual return: £13 if you do it online or £40 on paper. Once its paid, you can file as many times as you want for no extra charge.

How Can RIFT Help?

The best news, as always, is that RIFT Residents don't need to worry about any of the new changes. If we're on your team, we'll handle your confirmation statements for you just as we did with your annual returns. It's all part of the service.

Get in touch if you've got any questions or worries, and keep your ear to the ground for more Voices from the RIFT...

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