20/01/2009

Company late filing penalties increasing from 1st Feb

Late filing penalties were introduced to encourage directors of limited companies to file their accounts on time. In an effort to enhance the effectiveness of the late filing penalties, the government will, under provisions in the Companies Act 2006 (the Act) alter the current schedule of late filing penalties to reflect inflation and increase penalties for companies that file more than one month late.

In addition, these changes will apply to accounts prepared under the Companies Act 1985 but delivered late on or after 1st February 2009 when the updated penalties come into force.

How long do I have to file my company’s accounts?

A newly incorporated company’s first annual accounts must be delivered to Companies House within 21 months of the date of incorporation for private companies and 18 months for public companies.

In relation to subsequent accounts companies with accounting periods beginning on or after the 6 April 2008 should note the following changes to the filing deadlines with Companies House:

  1. Private companies – the delivery deadline has been reduced by one month from 10 to 9 months; and
  2. Public companies – the delivery deadline has been reduced by one month from 7 to 6 months.

What are the new late filing penalties?


How late are the accounts delivered*

Penalty for a Private Company

Penalty for a Public Limited Company

Not more than one month

£150 (£100)

£750 (£500)

More than one month but not more than three months

£375 (£100)

£1500 (£500)

More than three months but not more than six months

£750 (£250)

£3000 (£1000)

More than six months but not more than 12 months

£1500 (£500)

£7500 (£2000)

More than 12 months

£1500 (£1000)

£7500 (£5000)

* The figures in brackets indicate the penalties applied before 1 February 2009.

Furthermore, when a company fails to comply with filing requirements in relation to the previous financial year (and the previous financial year had begun on or after 6th April 2008), the penalty will be double that shown in the table.

How will I know when a penalty is levied?

Companies House will send reminders to file accounts to the company’s registered office address (although are not required to). If accounts are delivered late, an invoice is issued automatically to the company’s registered office address (including flat management and dormant companies). For this reason we recommend that directors:

  1. allow enough time to ensure that company accounts reach Companies House within the period allowed in the Act (guaranteed methods of delivery should be used, a penalty will not be waived if accounts are delayed in the post); or

  2. file certain categories of accounts using WebFiling services available form the Companies House website – www.companieshouse.gov.uk (an email will be sent acknowledging receipt of the accounts).

What will happen if the penalty is not paid?

Late filing penalties only apply to accounts and are a civil law matter. The penalty will be referred to collection agents if it remains unpaid and legal action may be taken which could result in a County Court judgment against the company.

Failure to file accounts is a separate criminal offence, which can result in directors themselves being fined on conviction in the criminal courts.

Are there any other fines for late filing?

In the event a company amends its articles of association, a copy of the amended articles must be sent to Companies House within 15 days. Failure to comply is a criminal offence. The Act introduces a new civil penalty of £200 for failure to comply. The penalty will only come into effect if a company receives notice from Companies House requiring it to deliver a copy of its amended articles and it does not comply within 28 days. The company would remain liable to criminal proceedings in addition to the £200 civil penalty.

If you have any questions on the points raised in this article, please speak to your regular contact at Gordons. Alternatively, please contact James Fawcett on 0113 227 0369 or james.fawcett@gordonsllp.com.

This note only summarises certain provisions of the Act and some practical consequences of those provisions; it should not be treated as a comprehensive guide or specific advice. If you are in any doubt as to the implications of the Act, you should take specific professional advice.