Companies House Late Filing Penalties: Avoid Costly Delays

Facing ‘Companies House late filing penalties’? Immediate action is required to mitigate the initial £150 fee, which increases over time. This concise guide breaks down the penalty structure, highlights critical deadlines, and offers strategic advice for compliance—helping you safeguard your company’s financial standing and reputation.

Key Takeaways

  • Late filing of company accounts with Companies House triggers escalating financial penalties, with doubled penalties for consecutive late submissions, and may also affect the company’s corporation tax bill.

  • Timely filing reflects strong corporate governance and avoids serious consequences like fines, dissolution of the company, criminal liability for directors, and damage to stakeholder relations.

  • Companies can request an extension for filing accounts due to unforeseen circumstances, must avoid common filing errors for accuracy, and should be aware of the severe legal impacts of non-filing, including personal fines and director disqualification.

Understanding Late Filing Penalties

Companies House Late Filing Penalties

A late filing penalty is not a mere slap on the wrist; it’s a financial burden that can escalate if not addressed promptly. What initiates this penalty? If your company accounts fail to reach Companies House by the due date, it’s an automatic outcome. The amount of the penalty depends on how late the accounts are filed, and it can even impact your corporation tax bill. The plot thickens if you’re a repeat offender. If your accounts are late in two consecutive years, brace yourself for the penalty to double.

Companies House isn’t just concerned about your financials; it also wants to know if the information it holds about your company, including the company number, is accurate. Hence, companies must file confirmation statements. Failure to file these statements on time will also result in a penalty.

Private Companies and LLPs

Private companies and LLPs have their set of deadlines, including the filing deadline. The countdown to avoid a late filing penalty for a private company starts on 30 June 2020. To avoid penalties, make sure all necessary filings are completed before the filing deadline expires. But what if this date lands on a Sunday or a bank holiday? In that case, the last working day before the deadline is your cut-off.

The filing deadlines for company accounts are as follows:

  • The first set of accounts for a new company should be filed with Companies House within 21 months of its incorporation date.

  • For subsequent years, the annual accounts should be filed within 9 months after the company’s financial year ends.

  • If the accounts are filed up to one month after the deadline, a late filing penalty of £150 will be imposed.

Public Companies

On the other hand, public companies have their own timelines. Their first accounts should reach Companies House 18 months from the date of incorporation or 3 months from the accounting reference date, whichever is longer. Subsequent annual accounts have a shorter deadline, needing to be filed within 6 months after the first filing.

Public companies should be aware that the penalties for late filing escalate as the delay lengthens. Thus, the greater the delay, the steeper the penalty.

The Importance of Timely Filing

A woman in a business suit is writing on a board, discussing Companies House late filing penalties.

Timely filing isn’t merely about dodging penalties; it demonstrates your dedication to robust corporate governance. The consequences of not meeting the deadlines are severe. It doesn’t stop at fines; it could lead to your company being struck off the register and even criminal liability for the directors.

Your stakeholders are also watching. Late filing can lead to financial reporting inaccuracies, which can shake investor confidence, impact employees, and strain customer relations.

Key Deadlines for Company Accounts

Being aware of the key deadlines for filing accounts is vital to steer clear of penalties. For private companies, the annual accounts need to be filed within 9 months from the end of the accounting reference period. Public companies, however, have a shorter window of 6 months.

For new companies, the first accounting reference date is set as the last day of the month in which its first anniversary falls. Their initial accounts should be filed 9 months after the end of the company’s financial year, covering at least 12 months. The onus of ensuring these deadlines are met lies with the directors or designated members of the LLP.

How to Request an Extension for Filing Accounts

An extension request letter for Companies House late filing penalties.

Sometimes, unforeseen circumstances might hinder your ability to meet the filing deadlines. In such cases, Companies House allows companies to request an extension. However, this must be done before the deadline has passed, and there must be compelling reasons for the anticipated delay.

When requesting an extension, you must pen a letter to Companies House outlining the reasons necessitating the extension, alongside the extra time required to file the accounts. Circumstances that could warrant an extension include:

  • short-term acute illnesses or unforeseen events

  • recent physical illness or injury

  • mental ill-health

  • long-term or chronic physical conditions

The duration of the extension granted can vary.

Avoiding Common Filing Errors

While rushing to meet deadlines, companies often make common filing errors such as contradicting previously submitted information, making mistakes during incorporation, and incorrectly filing invoices. What’s the consequence? Minor errors can escalate into hefty penalties, encompassing fines and possible imprisonment.

To ensure your accounts are comprehensive, they should include:

  • A balance sheet that accurately represents your company’s assets, liabilities, and receivables on the final day of the financial year

  • Adherence to Companies House guidance

  • Maintenance of comprehensive records

  • Strict accuracy in bookkeeping

  • Implementation of various error prevention techniques

By following these steps, you can ensure that your accounts are accurate and complete.

The Impact of Late Filing on Corporation Tax

Late filing can trigger a domino effect on your corporation tax. For example, if a company tax return is filed late, a penalty of £100 is imposed, which can increase to £500 for each consecutive late filing if the tax return is late three times in a row. To avoid these penalties, it’s essential to know how much corporation tax is due and file your returns on time.

If a company’s tax return is filed more than 6 months late, HMRC will issue a tax determination specifying the amount of Corporation Tax the company must pay. This amount cannot be appealed, and the company is required to pay the specified tax and file its tax return to avoid further unpaid tax consequences.

The only acceptable reasons for late filing of tax returns are unforeseen events that prevented the company from fulfilling its tax responsibilities, while reasons such as relying on another person to file, not receiving a reminder from HMRC, or making an error on the tax return are not acceptable.

Navigating Confirmation Statements

Penalty notice from Companies House

Filing confirmation statements also form a critical part of your company’s filing obligations. A confirmation statement is a document that verifies the accuracy of the information held by Companies House. These statements can be filed online using your password and authentication code.

Failing to file a confirmation statement can lead to a fine of up to £5,000 and could even result in your company being struck off the register. Additionally, directors or LLP designated members can face personal fines in the criminal courts.

Dealing with Penalty Notices

Receiving a penalty notice can be a daunting experience, but understanding why it was issued is the first step in dealing with it. If you believe there were exceptional circumstances that caused the delay in delivery means actual receipt, you can appeal the penalty and potentially avoid having to pay penalties.

If your initial appeal is unsuccessful, you can reach out to the Senior Casework Unit at Companies House, and if the penalty is upheld again, you can request a review by an Independent Adjudicator.

Should you be incapable of paying the penalty promptly, Companies House allows you to request a payment plan. Don’t forget that if you fail to pay a penalty, your company may face enforcement proceedings. Prompt payment is critical to dodge possible legal action.

Strategies for Preventing Late Filing Penalties

As the saying goes, prevention is better than cure, and this applies to late filing penalties as well. Start by allocating adequate time for account preparation. Early planning can help you avoid the last-minute rush and potential errors.

You can also use email reminders to manage filing deadlines. Create impactful reminder emails and schedule them using automation tools. Lastly, consider submitting your accounts electronically. This method is not only cost-effective but also comes with built-in checks that can help avoid errors and rejections.

Legal Consequences of Non-Filing

Penalty notice from Companies House

The legal implications of non-filing can be grave. Directors who fail to file company accounts may face:

  • fines

  • daily default charges for ongoing non-compliance

  • disqualification from serving as a director of a UK company

  • personal fines in the criminal courts.

However, directors can defend themselves by demonstrating that they have taken all reasonable measures to ensure compliance or by showing honest and reasonable conduct in the circumstances. If faced with prosecution, directors should seek legal counsel promptly.

Summary

In a nutshell, understanding and adhering to the Companies House regulations can save your company from unnecessary financial stress and legal issues. Remember, deadlines are not just dates on a calendar; they are regulatory requirements that hold legal and financial implications. So, plan ahead, file on time, and keep your company on the right track.

Frequently Asked Questions

What is the penalty for late filing at Companies House?

The penalty for late filing at Companies House is a fine. It’s important to ensure timely submission to avoid incurring these penalties.

Can you extend the filing date on Companies House?

Yes, you can extend your accounts filing deadline with Companies House if there’s an event outside of your control, such as a fire destroying company records, but you must apply for the extension before your filing deadline.

What are the deadlines for submitting annual accounts for private and public companies?

Private companies must submit their annual accounts within 9 months from the end of the accounting reference period, while public companies have a deadline of 6 months. This ensures timely compliance with submission requirements.

What are some common filing errors that companies often make?

Some common filing errors that companies often make include contradicting previously submitted information, making mistakes during incorporation, and incorrectly filing invoices. Be sure to review all information for consistency and accuracy before filing.

What is the impact of late filing on corporation tax?

Failing to file corporation tax on time can result in penalties from HMRC, such as a £100 penalty for late filing, with the amount increasing to £500 for each subsequent late filing if it happens three times in a row.

About Graham

Accountant specialising in tax, property, and estate planning. A regular speaker at landlord, property Investor, and later life planning events.

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