A little noticed element of the Companies Act 2006, which increases late filing penalties for both Private and Public Limited Companies, comes in to force this Month and may catch many local companies unaware.
"Not only does the act substantially increase Late Filing penalties in the first year" said Claire Cain of accountants Inspire Professional Services Ltd "but if you file late for a second year then the penalty doubles. This means that a company which habitually files its accounts over one month late will pay £375 in the first year and £750 in the second as opposed to the current charge of £100."
Additionally, the time limit for private companies to file their accounts is reduced from the present ten months to nine months after their year end. For public companies the limit is reduced from seven months to six. Therefore even companies who file their accounts on time need to be aware that the deadlines have shortened, and that new filing penalties will apply.
Although this change in Companies House's filing regime was announced in 2006, when the new act gained Royal Assent, many business people haven't realised the impact it may have on their firms.
"This is just a small part of a root and branch overhaul of company governance in the UK" said Claire, "the team at Inspire have been working hard to advise our clients on how it will affect their businesses as there have been many subtle but significant changes."
Although the Act is not due to be fully implemented until October 2009, this and several other sections start to come into force from this April. Full details are available to download at www.companieshouse.co.uk where there is also a helpful frequently asked questions section.
Claire Cain of Inspire
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