Business Law & Compliance

Confirmation Statements And Why Every Company Should Have One

Luisa Ddakis | 10 December 2021 | 2 years ago

Confirmation statements and why every company should have one

Within the United Kingdom, each business registered at Companies House is required to file a confirmation statement annually to the government’s official company registrar. The purpose of this document, its data and the process is to ensure that the Companies House contains the most current legal data on all companies at all times.

The Government has virtually no exceptions to the obligation. Regardless of whether the company might be dormant or is not trading, each company is obliged to complete and submit the verification of their details annually via the confirmation statement.

Why must every company have a confirmation statement?

Making the process compulsory has resulted in the Companies House ensuring that the legal data they are holding is as current as possible. The data is granular, encompassing all adjustments made to directors or ‘people with significant control’ as well as positions held such as the company secretary title. Another change that Companies House must be notified of is when the registered address of the company’s office is altered.

In addition to submissions made for alterations like those listed above, each company is still obliged to make this annual submission regardless of changes or not. Should all your data remain the same, there is still a submission obligation for the review period.

Once those details have been captured in the form, it is also necessary to declare the required financial data. This will encompass notification of adjustments to the standard industrial classification code (SIC) code, categorising the type of trading the company undertakes, a statement of capital, verification of the company’s shareholding, notification of any PSC exemptions received, and a declaration of the company’s current shares trading position.

Avoiding, omitting, delaying or forgetting to submit the company’s confirmation statement to the company registrar is not advisable. Such behaviour can lead to you facing prosecution – so prioritise it. The below sections will detail more on the what, when and how relating to confirmation statements.

What is a confirmation statement in the United Kingdom?

The obligation to submit confirmation statements annually was introduced by the Companies House midway through the year 2016. In addition to its purpose, stated above, its implementation brought about a simplification of a process for updating business information at Companies House.

It simplifies the mammoth task of Companies House, to remain current on the details of every registered business in the UK.

This means that businesses that are limited companies and limited liability partnerships are obligated to submit a confirmation station a minimum of once per annum. As mentioned earlier, this is regardless of whether the company is dormant or the limited liability partnership is dormant.

What was done before confirmation statements?

Prior to the government designing and implementing the confirmation statements system, each registered company was still required to submit data. The Companies House had to receive an annual submission of a full overview of each registered business annually. The simplification created is that it is, firstly, all online now, and secondly, you are therefore able to review the detailed data and verify it is in order.

The obligation to submit every year is to ensure that the data is reviewed regularly and to reduce the risk of oversights. To this end, your obligation remains in place regardless of zero changes happening to your company data. Your submission of unchanged data is a confirmation of no changes occurring.

Filing a confirmation statement form

The company registrar has set up a very efficient online database on the Companies House website. They advise that the simplest process for filling out and submitting a company confirmation statement is to utilise the forms available on their website.

When changes have occurred to the information relating to your business, the adjustments can be declared in the Additional Information part of the digital submission. This is the area in which you would note changes to the:

  • Standard Industrial Classification (SIC) code
  • Statement of capital
  • Trading status of shares
  • Exemption from keeping a register of people with significant control
  • Shareholder information
The database supplies a very efficient service, and it makes it easy to verify the data that is being held at Companies House regarding your registered business.

Note: There are different forms for the various changes that your company may have undergone. For example, adjustments to the company officers or company’s registered address for its offices are reported on another form to that which is used for SIC code adjustments. They are all available, easily searchable and logically laid out. Even if there is a large number of changes that need to be captured into the Companies House system, it can all be uploaded in one session. The only sequence requirement is that you must action the uploading of the changes before the confirmation statement submission.

Are there different ways to submit a confirmation statement?

The short answer? Yes. You can choose from three alternative processes to utilise for the submission of your company’s confirmation statement.

Option Number 1: Submit your statement by Royal Mail. The CS01 or LLCS01 hard copy can be posted which you can access via the government website.

Option Number 2: Use the digital option and register on the Companies House WebFiling platform.

Option Number 3: Use the services of a company formations agency. It is recommended that you review the reputation of various formation agencies before committing to one. By using a team of experts, you alleviate yourself of administration hassles so that you can focus on client relationships, sales and business strategy.

What information must be completed on the confirmation statement?

The data that the Companies House database requires is as follows:

  • Full details of shareholders
  • Shareholdings per shareholder
  • Registered office address
  • SIC codes
  • Statement of capital
  • The company’s shares details and aggregate values
  • The total value of unpaid shares (aggregated)
  • An update on the status of the company’s shares (that are being traded)
  • PSC details – This is the acronym for ‘Persons of Significant Control’

Are there fees for confirmation statement submissions?

Yes, each company is required to pay a fee for their statement submissions. If you have chosen Option 2 and process the submission online, the fee is a reasonable thirteen pounds. This fee not only covers your original submission but any amendments and updates that you submit over the next 12 months as well.

If you have chosen Option 1 and submit a hard copy form, the fee amount increases to forty pounds. This does make Option 2 more attractive, which is no doubt the government’s aim with the pricing structure. Option 2 is also very convenient as the database will populate the digital form with existing information, speeding up the entire process. Double win.

It is important to remember that the timing of payments is not aligned to statement submissions. You are obliged to action the transfer of the fees one year from:

  • the company’s date of incorporation; or
  • the last submission date of the payment of a fee (this only applies to older companies).

When are the confirmation statements deadlines?

The legislation relating to the company registrar requirements requires confirmation statements to be submitted annually as a minimum. The date of submission is flexible; the only limitation is that it must be within twelve months.

The twelve months is called a ‘review period’, which sounds very sophisticated but it is just a time period within which you can ‘review’ your business details to check up on any changes. The review period is flexible and adjusts according to your company age and your follow-up submissions. What does this mean?

If you have just registered a company then your review period is measured from the registration date, ending exactly twelve months later. For example, should you register your business on 1 November 2020, then the twelve-month window would close on 31st October 2021.

As years go by, you might change the details of your company during one of these review periods. You would then do a submission and your review period will be measured from that submission date.

Are confirmation statement reminders sent to companies?

Yes, the company registrar database does issue reminders to all members of its database and, luckily, as all your details are up to date, the reminder will go to the correct address for the attention of the correct person. It will be sent out two weeks before your filing deadline, so the reminder period is not very long.

That reminder is, in fact, an emergency reminder because you are actually required to submit your confirmation statements two weeks before your twelve-month period expires! So keep track of the dates yourself; don’t wait for the reminder.

Remember, the confirmation statement cycle is an annual cycle with a ‘review period’ that is twelve months long, commencing from the date you registered your company or when you submitted your last confirmation statement. For example, if your previous submission date was 1st February 2021, the twelve-month period is measured from that date. The next submission deadline will therefore be two weeks before the 31st January 2022.

You can make your confirmation statement early, starting a new review period that ends 12 months later.

Is it a problem if my confirmation statement submission is late?

Short answer: Yes! It is a problem if you have missed or ignored the deadline. You must track these dates and submit your confirmation statement at least two weeks before the end of the company’s review period.

In the event that you have passed the deadline, it can unfortunately lead to your business, or its listed officers, being subject to prosecution. In extreme cases, this could also result in your business being struck off the company registrar’s database.

What if an error has been made on a filed confirmation statement?

As the system allows for multiple submissions per year, if there is an honest error in the uploaded data, it can be amended by simply compiling and submitting a follow-up, correcting confirmation statement. An RPO4 form would accompany this submission.

As with the original submission, there are multiple submission options:

Option Number 1: Submit your statement by Royal Mail. The CS01 or LLCS01 hard copy can be posted, which you can access via the government website.

Option Number 2: Use the digital option and register on the Companies House WebFiling platform. Or you can upload pdf versions of the documents.

Option Number 3: Use the services of a company formations agency. It is recommended that you review the reputation of various formation agencies before committing to one.

If you have noticed that an error has been made, it is advisable to submit your correcting confirmation statement as soon as possible. This will show the company’s acknowledgement of the error and their desire to register correct details with the company registrar.

What to do when your company information changes

Within some review periods, you might find that shareholders change or another piece of information. You are immediately obliged to inform the Companies House of these changes.

The process is simply a new submission of a confirmation statement for changes to information such as:

  • SIC codes
  • Your capital statement
  • The trading status of company shares
  • An adjustment to any exemption regarding the register of PSCs
  • Shareholder data changes
If there are adjustments to company data not listed above, then those changes are not done solely via a confirmation statement. Depending on what the changes are, you will need to look up the appropriate section in the online submissions system of Companies House or complete a hard copy form.

What changes cannot be made via a confirmation statement:

  • The company’s registered address for their offices
  • Single Alternative Inspection Location (SAIL)
  • People with Significant Control (PSC)
  • Company directors and company secretary
  • Company accountant
When you have updated the details into the Companies House database, you do not also need to submit a confirmation statement submission. You will only be required to confirm that the details being held on the registrar database are fully up to date when your next submission date for confirmation statements comes around.

Is there a difference between a new confirmation statement filing and a correcting confirmation statement?

In both of these instances, you should follow one of the three submission processes. You can use different submission options, but the process within each option will stay the same.

Remember, you can submit multiple confirmation statements within each review period for any suitable changes made to the company information.

Is it that important to correct an error on the confirmation statement?

Whilst you might not feel it is important, the legislation certainly does. Errors are merely incorrect data and the legislation within Part 24 of the Companies Act 2006 states that the directors of a registered limited company or partnership are legally obliged not to falsify any information. Whilst an error is not falsification, omitting to correct it could be deemed an act of falsification. This can lead to fines or prosecution. They might also face the threat of being disqualified for not upholding their legal duties.

On another wider level, you will come up against problems with various institutions, e.g. finance institutions, investors, creditors, etc, if your Companies House data is incorrect.

 

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