August 1, 2023 File on time
“Company directors have a legal responsibility, under the Companies Act 2006, to file the company’s annual accounts and confirmation statements on time, ensuring their company details are up-to-date.” That reminder from Companies House accompanies the most up to date information available on the filing of completion statements and annual accounts, as at the end of March 2022.
The statistics reveal that 97.2% of companies had filed their completion statements on time, whilst 98.4% were up to date on accounts filings. When you consider that the figures exclude companies in receivership, that still leaves over 125,000 companies which had failed to file their completion statement on time and nearly 73,000 companies which failed to file accounts.
No wonder then that Companies House regularly updates its guidance on late filing penalties. Introduced in 1992 as a means of encouraging directors to file their reports on time, the guidance applies to both private and public limited companies as well as limited liability partnerships. Fines, which in the year to March 2022 amounted to nearly £172 million, only apply to late filing of accounts. There is no financial penalty for late filing of confirmation statements.
However, that doesn’t mean that confirmation statements and other returns can take a back step. As Companies House points out, “not filing your confirmation statements, annual returns or accounts is a criminal offence – and directors or LLP designated members could be personally fined in the criminal courts.” Indeed, in the 2021-22 year 763 directors were convicted in respect of filing failures.
It’s worth, therefore, taking a look at the Companies House guidance as it not only sets out potential penalties, it also highlights some of the ways in which companies could inadvertently fall foul of the late filing rules. For example, accounting submissions are only viewed as being on time if they are full and complete; so even if a signature is missed in error, a late filing penalty could occur. And whilst most filings are now done electronically, any which are posted need to be sent in such a way as to ensure that they arrive on time, even if the deadline day is on a weekend or bank holiday.
Companies House therefore recommends keeping regular reminders on your calendar. It also recommends liaising with your accountants to ensure that you provide them in good time with the information they need to enable them to prepare an accurate suite of company returns which can then be filed on time.