As part of the ongoing efforts to combat economic crime and enhance corporate transparency in the UK, Companies House is introducing a new system of Authorised Corporate Service Providers (ACSPs). This change, stemming from the Economic Crime and Corporate Transparency Act 2023, will have significant implications for small business owners and their accountants.

Let’s delve into what this means for you and how you can prepare.

What are Authorised Corporate Service Providers?

ACSPs are third-party agents, such as accountants and company formation agents, who will be authorised to file information and carry out identity verification checks on behalf of their clients with Companies House. This new system is designed to improve the accuracy and reliability of information on the public register, helping to prevent fraud and other economic crimes.

Why the change?

The introduction of ACSPs is part of a broader initiative to strengthen the UK’s defences against economic crime. By ensuring that those who file information are properly authorised and identifiable, Companies House aims to:

1. Enhance the accuracy and trustworthiness of the public register.
2. Prevent fraudulent activities and identity theft.
3. Improve collaboration between regulatory bodies.

What does this mean for Small Business Owners?

If you’re involved in the running of a limited company, you should be aware of the following implications:

1. Identity Verification: You will be required to verify your identity with Companies House, especially if you’re a director or person with significant control (PSC). This is relevant whether you have an existing limited company or start a new one. 
2. Choosing Service Providers: Ensure that any third-party you use for company filings (e.g., your accountant) is registered as an ACSP. They will need to be registered to submit accounts or any other filings at Companies House, as well as to complete any identity verification.
3. Increased Scrutiny: Companies House will have more power to query and reject information, potentially leading to more rigorous checks on your company’s filings.
4. Accuracy is Crucial: With increased scrutiny, it’s more important than ever to ensure all information submitted to Companies House is accurate and up-to-date.

Timeline and key dates

While the full implementation of these changes will be phased, there are some key dates to be aware of:

• Spring 2025: ACSP registration process was due to open on the 25^th February but was withdrawn with 24 hours to go. 
• 25 February 2025: Companies deemed to have been formed for false or illegal purposes may be struck off more quickly.
• 25 March 2025: Individuals can voluntarily verify their identity with the Registrar.
• Autumn 2025: Identity verification becomes compulsory for new directors.
• Spring 2026: Identity verification becomes compulsory for all presenters.

Practical steps to take now

1. Review Your Company Information: Ensure all details on the Companies House register are accurate and up-to-date.
2. Prepare for Identity Verification: Familiarise yourself with the identity verification process and gather necessary documents. See below for more details about verifying your identity directly with Companies House.
3. Communicate with Your Accountant: Discuss these changes with your accountant or company secretary to ensure they’re preparing to register as an ACSP. For our clients, rest assured we will be registered!
4. Stay Informed: Keep an eye on official communications from Companies House and reputable sources for updates on these changes. We’ll keep you posted on here with updates as they become available.
5. Consider Early Adoption: Once available, consider verifying your identity voluntarily to stay ahead of mandatory requirements. 

Mandatory Identity Verification

Every Director or PSC will still need to verify their identity under the new Companies House requirements, even if they’ve been listed at Companies House for many years. This will require over 7 million people to go through the process of verifying their identity within a twelve month period, and will be required before a Confirmation Statement can be submitted.

The verification process must be completed by autumn 2026, as part of a 12-month transition period beginning in autumn 2025.

If an individual is eligible for one of the documents, such as a passport, that includes biometric or photographic features, the rules state that this document must be used, requiring individuals to register for these documents if they don’t already have them. 

This verification is entirely separate to any Money Laundering checks that may already have been completed.

The emphasis is currently on accountants and other professionals to inform individuals of this coming requirement, which is not a good thing in our book! 

How to verify:

According to current details, individuals will have two main options for verifying their identity:

1. Direct verification with Companies House:
   • Create a Companies House account.
   • Link their identity to a primary photo ID document (e.g., passport or driving licence) including a photo and ideally biometric features.
   • Take a photograph of their face.
   • The system will compare the photo with the ID document.
   • This option can be completed in one of the following three ways:
     • GOV.UK ID Check app: Use a biometric passport, UK photocard driving licence, or other accepted documents.
     • GOV.UK One Login: Use a UK passport or UK photocard driving licence.
     • Post Office verification: Visit a Post Office with accepted ID documents for in-person verification.
2. Verification through an Authorised Corporate Service Provider (ACSP):
   • This can be done via accountants, solicitors, or other regulated professionals, BUT many such professionals, ourselves included, are undecided whether to offer this. The process is hugely complex, requires a significant investment in technology and training that will be of little value beyond this initial process, and require a face to face visit with every client; from our perspective, that’s not realistic, particularly if clients can complete the process directly. 
   • We’ll confirm our final stance on the process once clearer guidelines are available.

Implications for non-compliance

If individuals don’t verify their identity by the autumn 2026 deadline, it could result in:

• Inability to act as a director.
• Companies being unable to file key documents.
• Potential fines or enforcement action.

To avoid any issues or complications, individuals should keep informed about Companies House announcements and ensure their company information is accurate and up to date. The potential lead-time for verification, including obtaining any required biometric documentation, means that this is not going to be a job to be completed at the last minute!

The importance of accuracy

With these new measures, the accuracy of information submitted to Companies House is more critical than ever. Errors or inconsistencies could lead to rejections, delays, or even legal consequences. It’s crucial to double-check all information before submission and seek professional advice if you’re unsure about any requirements.

In conclusion…

These changes are complex and, in our view, will place an enormous burden on a huge number of people to catch a few who may be acting fraudulently.

By essentially forcing anyone who needs to verify their identity to obtain a biometric passport, for example, there is going to be an unworkable burden placed on offices such as the Passport Office, unwarranted costs imposed on individuals, to say nothing of the time implications.

We understand the justification for the new rules, which are designed to create a more secure and transparent business environment in the UK, but the current outlined process appears unworkable. We’re hoping this was why the launch was delayed and that there’s a dramatic rethink going on!

We will of course keep you up to date on the requirements for verifying your identity once the guidelines are updated, but it’s definitely a new requirement that limited company owners, directors and PSCs should be aware of and keep an eye on. Getting verified is not going to be a quick process, and it’s not necessarily going to be one that we can support you through.

If you’ve got any immediate questions, or are aware of any details on the Companies House register that need to be updated, please get in touch.