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Identifying your People with Significant Control

From June 30th 2016 you will need to notify Companies House about your People with Significant Control (PSCs) when you file your next Confirmation Statement (the replacement to the annual return). For new Limited companies this information is supplied as part of the company incorporation process.

The concept of PSCs was introduced as part of the Small Business, Enterprise and Employment Act in order to deliver more transparency in regards to company ownership.

What is a Person with Significant Control?

There are four general categories that define a Person with Significant Control:
  • 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 first three items on the list are rather simple to identify for most limited companies and LLPs. The final point the right to exercise significant influence is a little more nuanced but fortunately will not likely affect the vast majority of owner managed business.

What information will I need to supply?

For each Person of Significant Control in your company you will need to supply the following information.
  • Full name
  • A service address (for correspondence)
  • A residential address (if the PSC is a natural person and the address differs from the service address)
  • Date of Birth
  • Nationality
  • Nature of control, i.e. one or more of the points mentioned further up

What about Corporate PSCs?

Lets assume 50% of the issued share capital is owned by another incorporated company. This company would ordinarily be regarded as a Registrable Legal Entity or RLE. However this company will not qualify as an RLE if it is based offshore in a jurisdiction that does not enforce the documentation of PSCs. In such cases the UK company must take reasonable steps to identify the stake holders (typically those holding a majority stake) behind the foreign entity and document these individuals separately on the PSC register.

Assuming the corporate shareholder is a UK registered company and in turn retains a record of its PSCs then this company is regarded as an RLE and can be entered on the PSC register. For corporate PSCs the following information must be supplied.
  • Company name
  • Company address, e.g. registered office
  • Legal form (e.g. Incorporated company)
  • Governing law
  • Company registration number
  • Nature of control, i.e. one or more of the points mentioned further up

Automatic PSC Identification

To save time manually entering each PSC, The Company Wizard includes an option to automatically identify your PSCs based on your shareholders and appointed members (For limited by guarantee companies).

Find out more about automatic PSC identification here

Additional guidance

For more information regarding the new PSC rules along with a number of detailed examples, please refer to the Companies House PSC guidance.

That's it for now, your can also find more general information on Persons of Significant Control here.
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