People with Significant Control
From April 6th the vast majority of UK incorporated companies are required to maintain a register of "People with Significant Control" or a PSC for short. The PSC register was introduced under a G8 agreement as a push for greater transparency and accountability in terms of company ownership and enhancing the visibility of key decision makers, beneficial owners or those that influence control over a company.
Identifying a Person of Significant Control
Existing Limited Companies must first identify who the key People of Significant Control are in their company. This would generally be somebody who would satisfy one or more of the following criteria.
- A person, corporate entity or trust holding more than 25% of the issued shares
- A person, corporate entity or trust holding more than 25% of the voting rights
- A person, corporate entity or trust that holds the power to remove the majority of the board of directors from the company
- Or otherwise has the right to exercise significant influence on a companys decision making
The last one is a little fuzzy but it would generally exclude those individuals acting in a professional capacity as either a lawyer, accountant, investment manager or financial advisor. Additional exemptions are made for employees or directors that do not exercise voting rights or own shares. The statutory guidance will offer more clarity on those other roles that may qualify an individual or corporate entity as a Person of Significant Control.
Find out more about how to identify a Person of Significant Control
Registering a Person of Significant Control
From April 6th 2016 the legislation became effective requiring all UK companies to initially maintain their own register of People with Significant Control. This would ordinarily be filed with the general statutory register for the company.
From June 30th 2016 the Confirmation Statement will replace the Annual Return, it is the Confirmation Statement that will become the vehicle to notify Companies House about your PSCs. A company must file at least one Confirmation Statement within any 12 month period, the Confirmation Statement will provide the necessary means to initially notify Companies House about your PSCs and to amend them as and when is necessary.
The Public Record
From 30th June Companies House will allow the People with Significant Control register to be accessible on the public record through an online search facility. Gradually as companies submit their Confirmation Statements to Companies House, the PSC register will gradually fill up.
Future changes to the People with Significant Control register
It is envisaged that further legislative changes to the PSC register will be made in the next year as a result of the Fourth EU Money Laundering Directive (MLD). This came into force in June 2015 and must be implemented by member states by June 26th 2017. These directives will potentially require additional disclosures by beneficial owners in a broader scope to those mandated in the current UK Legislation. Until the MLD is transposed into local law, the implementation of such changes will remain unclear.
New Company Formations
From 30th June Companies House will also require all PSCs to be provided at the point of incorporation. The Company Wizard is working with Companies House on the new data schemas and all updates regarding the new layout will be ready by from 1st July.
Recent Blog Posts
- 22 Oct 2021 - How Can You Avoid Creditor Pressure As A Director?
- 14 Oct 2021 - What Is Dividend Tax?
- 08 Oct 2021 - Is Being Self-Employed The Same As Being A Sole Trader?
- 29 Sep 2021 - Common Budgeting Mistakes Made By Startups
- 24 Sep 2021 - Misconceptions Of Setting Up A Business