Every company and limited liability partnership, big or small, old or new, trading or dormant, is required by Section 441 of the Companies Act 2006 to submit company accounts and reports every year to Companies House. Whether you’re about to start a new company or a business that has already been operating for a while, it’s essential that you know what is required of you, getting it wrong can have serious consequences.
A company that fails to file its annual return or accounts risks being struck from the company register. Directors of that company will also likely face a fine, disqualification or criminal record for failing to carry out their legal duty.
What is an Annual Return?
An annual return is quite simply a snapshot of the company. It must be sent to Companies House every 12 months within 28 days of the anniversary of incorporation (company formation) or date of last annual return. The annual return must contain detailed information on:
- Company officers (directors),
- Shareholders,
- Registered office; and
- Share capital.
What are Company Accounts?
Every company must keep accounts. Even if they aren’t trading they are still required by law to keep the correct accounts. Company accounts should include things such as:
- Directors report,
- Auditors report,
- Balance sheet,
- Profit and loss statements; and
- More.
A dormant company must file accounts that reflect the share structure and non-trading companies may keep a record of income and expenditure in place of a profit and loss statement, but whatever the case may be, the law still requires prompt and correct submission. A company’s first accounts must be submitted within 21 months of incorporation for a private company or LLP, 18 months for a public company. The following annual accounts must be filed 9 months after the accounting reference date for a private company or LLP or 6 months for a public company. Failure to do so can result in hefty fines, as you can see from the table below. These penalties may be doubled where a company is late in filing its accounts late for two (or more) consecutive years. The importance of correct and prompt filing is clear.
| Length of delay | Private company | Public Company |
| Not more than 1 month | £150 | £750 |
| More than 1 month but not more than 3 months | £375 | £1,500 |
| More than 3 months but not more than 6 months | £750 | £3,000 |
| More than 6 months | £1,500 | £7,500 |
Here at The Company Warehouse, we’ve teamed up with Pinnacle Accountancy Limited to offer a company accountancy service to help fulfil your needs and avoid potentially nasty fines. Contact us today for more information on 0800 0828 727.
Related Reading:
- Accounting Requirements – Legal Obligations and Criminal Offences
- Accounting Compliance – Fulfilling Your Duties With The Tax Man
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