Companies House New Identity Verification Requirement

Companies House Identity Verification. What's Coming?

We have previously spoke about The Economic Crime and Corporate Transparency Act 2023 that made way to the significant reforms aimed to enhance the accuracy of company data and combat financial crime in the UK.

Since March 2024, various pieces of legislation have been gradually introduced to strengthen the integrity of the UK’s Business Registrar and improve the quality of information maintained by the Companies House about the business incorporated in the UK.

A key aspect of this legislation – the implementation of mandatory identity verification for individuals associated with companies registered at Companies House – is about to make a landfall in the UK business sphere.

Identity Verification Requirements:

Identity verification is a core part of the new legislation, ensuring that those involved in UK companies are who they claim to be. Anyone who is involved in registering, running, owning or controlling a limited company or a limited liability partnership in the UK will need to verify their identity with Companies House to prove they are who they say they are.

Under the new regulations, all directors, persons with significant control (PSCs), and individuals filing on behalf of a company will need to verify their identity with Companies House. This measure aims to prevent fraudulent activities, such as the incorporation of companies under fictitious names like "Mickey Mouse" or "Santa Claus."

Phased Introduction:

The implementation of new identity verification requirement will be phased in several stages to allow all UK businesses to comply with the new legislative requirements.

• Spring 2025: Voluntary Identity Verification: From 25 March 2025, individuals will have the option to voluntarily verify their identity;
• Autumn 2025: Mandatory Identity Verification: Identity verification becomes mandatory for all new company incorporations and appointments of new directors and persons with significant control (PSCs);
• Month Transition Period for Existing Individuals: A 12-month transition period will start from Autumn 2025. During this period all existing directors and PSCs will have to complete their identity verification;

This phased approach will ensure that over 7 million individuals owning or running UK Companies have enough comply with the new requirements within the stipulated timeframe.

Who would need to verify their Identity for Companies House:

The following individuals will need to verify their identity with the Companies House.

Directors: Every existing company director will need to verify their identity. Every new director will need to verify their identity before their appointment is filed with the Companies House.

Members of Limited Liability Partnerships: Every current member of a Limited liability Partnership will need to verify their identity. Every person who is becoming a new member of already registered Limited Liability Partnership will also need to verify their identity before their appointment is filed with the Companies House.

Persons with Significant Control (PSCs): Individuals who have significant control over a company by owning 25% or more of shares or voting rights, or having otherwise significant influence or control will need to verify their identity.

Anyone filing documents on behalf of a company: Any individual wishing to file on behalf of the company or a limited liability partnership will also need to verify their identity with the Companies House.

What are the options for identity Verification:

Those who would need to verify their identity for the Companies House will have the following options to complete the process:

• Directly with the Companies House: This would primarily be digitally through Companies House's own online service. Directors and shareholders will be able to use Companies House’ GOV.UK Gateway account to Login to verify their identity. They will need to provide Identification documents, for example passport or driving license.
• Through an Authorised Corporate Service Provider (ACSP): Alternatively, those individuals who don’t want to verify their documents via Companies House will have an option to use Authorised Corporate Service Provider (ACSP) – regulated professionals, like Company formation agents, accountants or solicitors.

Authorised Corporate Service Providers (ACSPs):

Authorised Corporate Service Providers play a crucial role in ensuring compliance with the new requirements. ACSPs typically professional service providers - companies or a private individuals who are subject to Anti-Money Laundering (AML) supervision and regulation, such as Accountants, Solicitors or Company formation agents, who have met Companies House's criteria for conducting identity verification.

Using Authorised Corporate Service Provider to verify ID documents, can offer convenience, because ACSPs may offer a more streamlined or personalised verification process. They can also provide assistance with the verification process and help people who have difficulties with the digital verification process.

By understanding the role of ACSPs, businesses and individuals can navigate the identity verification process more effectively.

Using their expertise in compliance, ACSPs can ensure that verification is carried out correctly and as per Companies House standards.

Conclusion:

Introduction of mandatory identity verification through Companies House is a pivotal step in strengthening the UK's corporate landscape. It is a crucial component of the UK's efforts to enhance corporate transparency and combat economic crime. It represents a significant step forward in creating a more secure and trustworthy business environment.

It's essential for all relevant parties to adhere to the specified timelines to ensure compliance with the new regulations and contribute to the integrity of the UK's corporate framework.

If you are interested in Registering your Limited Company in the UK, but require more information or guidance, why not call us on +44 (0) 207 935 5171 to discuss your questions or to Apply for a Consultation. Our experienced and highly professional business support team is here to help!