Accountants are now using a new method to file and update their clients’ PSC Register at Companies House, due to legislative changes from June 2017. This information must be kept up-to-date to avoid breaching new Anti-Money Laundering (4MLD) regulations.
Accounting technology expert Ian Cooper from Thomson Reuters answers some critical questions on the latest changes to the PSC Register. He explains what these changes mean and how software can reduce the administrative burden of providing real-time updates to the PSC.
What is the PSC Register?
People of Significant Control, or PSCs, are usually individuals holding more than 25% of shares or voting right in the company.
This covers a UK company, societas europaea (SE), Limited Liability Partnership (LLP), and Eligible Scottish Partnership (ESP). From June 2016, these companies must identify the people who own or control their company, and notify Companies House of any changes to these identities.
The PSC Register is a collation of this information held by Companies House and provides the necessary transparency of the person(s) that control every company within the UK.
How has the PSC legislation changed?
Until now, details of individual PSCs and statements about the state of the PSC Register had to be notified to Companies House using the annual confirmation statement. This was form CS01 for companies and form LL CS01 for LLPs.
You should now notify Companies House of this information using forms PSC01 to PSC09, which are a breakdown of the details needed to be recorded. Updating these forms can be achieved quickly and efficiently using Company secretarial software.
Why was there a change to the PSC?
The main reason for amendment to the legislation is to make it harder for terrorists and criminals to move money through the UK financial system. By supplying relevant information on a real time basis, Companies House can spot anomalies and identify high risk individuals.
With a requirement for more quality information on ownership, it’s clear that the way accountants pass information to Companies House was due an update. By meeting the legislation, accountants can avoid substantial financial penalties, whilst also negating risk.
What information do I have to provide?
You need to make sure you have up-to-date information for the following: the PSCs name, date of birth, nationality, county/state they live in, service address, residential address, date they became a PSC, level of their shares/voting right, and whether they have made an application to avoid public exposure.
This information should be submitted to Companies House via forms PSC01 to PSC09.
When do I need to update the PSC Register?
You need to report all changes to their PSC information as they take place – you will no longer be able to wait until the annual confirmation statement.
You have 14 days to update the PSC Register and another 14 days to notify Companies House of the changes.
Can software manage the PSC process?
Company secretarial software helps you to ensure any changes to the PSC(s) are recorded adequately and efficiently. Software automatically produces all of the relevant forms and enables seamless electronic submission to Companies House.
Is there a penalty for not complying with the PSC Register?
Failure to comply with the PSC process is a criminal offence and may result in a fine and/or a prison sentence of up to two years. It’s also worth noting that the Register can never be left blank.
Learn how to manage the PSC Register
Watch our on-demand webinar to understand the changes to the PSC legislation in more detail, and see first-hand how to simplify the process with our software solution for accountants.