Directors beware – £165m late filing penalties levied in 2022/23

A £165m reminder to directors on the importance of getting accounts filed on time has been flagged in the latest report from Companies House, the UK register of companies.

Every company director, or a designated member of a Limited Liability Partnership (LLP), is personally liable for filing accounts with Companies House on time, and in the right format, including when a company is not trading and treated as ‘dormant’.  Failure to do so is a criminal offence and, unlike most criminal offences, the prosecution doesn’t have to prove intent on the part of the directors, only that they didn’t file the accounts on time, making prosecution relatively easy to secure.  

TSP Corporate and Commercial director Caroline Nicholls commented:  “It is incumbent on all company directors to ensure that they are complying with their obligations in this regard and not to simply view reporting matters as, for example, the finance director, the company accountants or company secretary’s responsibility. 

“Even something as seemingly minor as a missing signature could result in a late filing penalty. And for those still relying on the postal system for paper accounts, Companies House say that five days must be allowed for checking, so meeting a tight deadline isn’t enough on its own.”  

The statistics from Companies House show that whilst 98.5% of accounts were filed on time, the 1.5% that missed their deadline resulted in 323,643 penalties being levied with a total value of £164.7m.  Although the average penalty was £509, almost £80m was raised by 80,000 ‘double penalties’, charged when companies file their accounts late for two successive years or more.

First accounts must be delivered to Companies House within 21 months of the date of incorporation (or 18 months for public companies), or 3 months from the accounting reference date - whichever is longer.  After that, in subsequent years, a private company or LLP has nine months from the end of the accounting reference period.  

TSP Corporate and Commercial director Nick Mayles added:  “Late filing may seem relatively minor, but the impact of a conviction is one of many consequences, such as being required to notify professional bodies and even having an impact on freedom to travel overseas.

“Therefore to avoid unnecessary delays, signing up for Companies House reminder emails, whether or not you are the main person responsible, is advisable as they will alert you when the filing deadline is approaching.”

If you would like to discuss any of the legal or practical considerations discussed in this article with the expert Corporate and Commercial team at Thompson Smith and Puxon, please contact Caroline Nicholls or Nick Mayles.