The Big Companies House Clamp Down – ID Verification & The Economic Crime & Corporate Transparency Act 2023

Despite having received Royal Assent on 26 October 2023, given the size and substance of the changes planned by The Economic & Corporate Transparency Act 2023 (ECCTA), it is being implemented in phases. The next big phase, identity verification (IDV), is being rolled out at the moment. Corporate and Commercial Associate, Gerard Chalkly-Maber, takes a look at what this means for company directors, among others, and how they can comply with their duties.

The ECCTA aims to strengthen corporate fraud protections and promote transparency. A key reform is the IDV regime which requires company directors, persons with significant control (PSCs) and LLP members to verify their identity with Companies House. This represents a decisive shift from the previously passive system and, while currently voluntary, will start to become mandatory in autumn 2025. With nearly 7 million individuals expected to be affected, understanding the scope of these reforms – especially IDV – is vital as the UK corporate regulatory framework evolves.

Those who wish to carry out IDV for Companies House (Authorised Corporate Service Providers (ACSPs)) or who merely file documents for companies at Companies House will also be subject to IDV themselves.

How IDV is carried out

Having been introduced on 8 April 2025, IDV is currently voluntary and may be carried out:

• directly through Companies House using the GOV.UK One Login service or app;
• in person at a post office; or
• through an ACSP.

Acceptable documents for IDV include a biometric passport, UK driving licence, biometric residence permit, biometric residence card or frontier worker permit. Individuals without these may use bank or building society details.

Mandatory IDV

IDV is to become mandatory in autumn 2025 for:

• all incorporations and new appointments of directors, PSCs and LLP members; and
• all existing directors, PSCs and LLP members.

No details have been given in respect of the mandatory IDV implementation date other than “autumn 2025” – such a date is still yet to be provided by Companies House.

IDV for incorporations and new appointments will be enforced immediately once the mandatory regime comes into force. However, IDV for existing directors, PSCs and LLP members will be enforced during a 12-month transition process, with the catalyst being a company’s annual confirmation statement, i.e. a confirmation statement will not be permitted to be filed until all necessary IDV has been carried out successfully.

Unique identifier code

Verified individuals will receive a unique identifier code from Companies House. From autumn 2025, this code must be used to link verified identities with existing appointments via the annual confirmation statement. New directors and PSCs, appointed after this date, must provide this code upon appointment filing.

ACSPs and those who file at Companies House

Prospective ACSPs must carry out IDV to register as a Companies House ACSP. ACSPs must be UK based and subject to a recognised anti-money laundering regime.

By spring 2026 any third-party agents filing on behalf of companies must be registered as an ACSP. It is important to note, this includes those acting on behalf of lenders filing security documents against borrower/guarantor companies.

Additionally, from spring 2026, any individual filing documents (not within an ACSP) must also carry out IDV.

Non-compliance

Non-compliance carries serious consequences. Directors who act without carrying out IDV risk disqualification, and the company and all directors may be committing an offence. Unverified PSCs could face fines or financial penalties. ACSPs that breach requirements risk penalties or criminal prosecution, alongside a suspension to their agent authority.

Impending changes beyond ID checks – What else to expect?

Also expected in autumn 2025:

• the ECCTA will remove the requirement to keep and maintain statutory registers, save for registers of members. Companies will no longer maintain local registers of directors, their residential addresses, secretaries or PSCs. Instead, these will move to Companies House, reducing duplication and improving data integrity. Registers of members will continue to be held and maintained by companies; and
• save for in limited circumstances, corporate directors will no longer be permitted.

Expected in April 2027:

• the filing of accounts must be done via software only;
• abridged accounts for small companies and micro-businesses will be abolished;
• directors’ reports will be mandatory and companies claiming audit exemptions must provide a detailed statement confirming eligibility; and
• to promote consistency, limits will be placed on how often companies can shorten their accounting reference period.

Contact

 If you would like to discuss any questions regarding IDV or the ECCTA, please do get in touch with Gerard Chalkly-Maber or any other member of our Corporate & Commercial Team at Online.Enquiries@LA-Law.com.