A new Companies House Penalties regime has been revealed as part of the implementation of the Economic Crime and Corporate Transparency Act 2023.  

This could mean tougher financial penalties for companies that don’t meet their obligations. For the first time this may include not filing their confirmation statements on time.  

More serious offences, such as ongoing non-compliance or fraudulent activity, could lead to civil action, director disqualification, or even criminal prosecution. Companies House have said they will work closely with the Insolvency Service and other enforcement partners to investigate and prosecute offences when necessary.

According to Martin Swain, Director of Intelligence and Law Enforcement Liaison at Companies House: ‘Where our guidance and support are not enough to encourage users to comply with the law or discourage misuse of our registers, we won’t hesitate to use these new powers available to us.’

What happens if you break the rules?

For minor breaches, such as late filing, the result may simply be a fine. The amount of the fine increases depending on the seriousness of the offence and how many times it has already happened. Amounts could range from £250 to £2,000.

Depending on the offence, the penalties could be in differing forms:

• Fixed penalty – a set amount, as is currently the case with late filing of accounts, for example.
• Daily rate penalty – a daily penalty for each day that the offence continues.
• A combination of a fixed penalty and a daily rate penalty, which could get very expensive, very quickly!

Companies House is also adopting what it’s calling a ‘holistic approach to enforcement’, which means that they will share intelligence with other bodies. For companies, this could mean that non-compliance could trigger a much deeper investigation, potentially leading to more severe consequences than in the past. 

How much will the penalties be?

This will depend on a number of factors, as follows:

• Have you committed the same or similar offences in the last five years?
• How serious is the offence?
• What representations were made during the warning notice period (usually 28 days from the issue of a warning).
• Any aggravating or mitigating factors.

	First offence	Second offence	Third offence	Fourth or more offence
Minor offence	£250	£500	£750	£1,000
Serious offence	£500	£750	£1,000	£1,500
Very serious offence	£750	£1,000	£1,500	£2,000

How to stay compliant

To avoid penalties, company directors should make sure they are up to date with their filings and other legal obligations. The most important points are:

• Ensure all filings are made on time: This includes confirmation statements, accounts, and any other required documents.

• Respond to any warnings from Companies House: Ignoring these can escalate the situation quickly. A warning notice should be issued before any further action, that will include details of the offence, the period within which a response can be made, the method required for delivering that response, and a warning of the type of financial penalty that may result.

• Keep up to date with any changes: Stay informed about legal updates that might affect your responsibilities as a company director. You can sign up to Companies House updates here.

• Seek help if needed: If you’re unsure about what’s required, don’t hesitate to seek professional advice.

If you have any questions or concerns about the new regime, please ask! We ensure, as far as we’re able to, that our clients hit their deadlines, so the new penalty regime shouldn’t become an issue for them. If you’re not a client, and have been known to ‘push’ the deadlines in the past, you may want to add them your diary to ensure you don’t do that in future!