Business owners and employers know only too well that the 6th of April every year always brings changes, and this year the date has not let us down.
One of the most far reaching changes this 6th of April is the introduction of the need for the majority of UK companies and limited liability partnerships (LLPs) to start keeping a register of ‘people with significant control’.
The ‘PSC register’ as it will be known is a new statutory register which has been formulated to make sure the people that ultimately own and control a company are identified.
What Legislation is Behind the New Rules?
The rules come in on the back of the Small Enterprise and Employment Act 2015 and carry the objective of tackling money laundering, terrorist financing and tax evasion. This will be done by making public both the beneficial and legal ownership of a business.
A new part and two new schedules will be added to The Companies Act 2006 and provisions will be detailed in The Register of People with Significant Control Regulations 2016.
Who is Affected by the Registers?
Anyone who owns or controls over 25 per cent of a company’s shares of voting rights, or who has control in any other way over the management of a company, will need to appear on the PSC register. The register will not resemble the shareholder register, as the controlling individuals are not usually the same as the shareholders.
All UK companies will need to compile and maintain PSC registers, except publicly traded companies already subject to the disclosure requirements of DTR 5.
PSC registers are not allowed to be blank, even if the company is dormant or has no interests to register. Failure to comply will lead to criminal punishment.
What are the Key Dates to Note?
Registers must start being compiled from 6th April 2016 and from 30th June 2016, companies will be required to file their PSC registers with Companies House.
Once filed, the registers will be searchable online, although residential addresses will not be shown.
What Action Should I be Taking Now?
It is time to take the first step and identify who owns or controls your company indirectly and directly, and who will need to appear on the register. Check your register of members, articles of association or if applicable, your shareholders’ agreement where you should find the information you need.
If you feel you need any guidance in ensuring you are compliant with the new system and its statutory requirements, you could speak to your local bookkeepers in the first instance. They will be able to point you in the right direction concerning the compilation of your PSC register and if required, they will be able to manage the maintenance and filing of the register at Companies House.