Covering issues such as: the consequences of filing your accounts late; how to extend your filing deadline; when you can change an accounting reference date; whether you need to file accounts if your company is dormant, and more…
Perhaps the most frequently asked question that arises when people are considering the filing of company accounts is “How do I know when my company accounts must be delivered?”.
However, as there are a number of rules that determine the company accounts filing deadline, we have dealt with this issue separately in our guide entitled: “When are my annual accounts due?
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1 I cannot prepare my company accounts in time - can I extend the filing deadline?
You may be able to apply to extend the time for delivering your company accounts to Companies House if they are delayed by
an unforeseen event which was outside the control of the company and its auditors or there are exceptional extenuating circumstances.
You should apply in writing before the normal filing deadline. Full details of how to apply are given in chapter 5 (page 21) of the Companies House document entitled Life of a company – part 1 annual requirements.
2 What happens if I file my company accounts late?
If you file your accounts late an automatic fine will be imposed on the company. The fines increase the longer you delay submission and the penalty is doubled if company accounts are filed late two years in a row. Public limited companies are also subject to higher tariffs than private companies. You may wish to refer to the Companies House Guide on Late Filing Penalties.
As well as the civil penalty imposed on the company, failure to file the company accounts is a criminal offence and the company’s directors (and company secretary) could face large personal fines and even disqualification from the role of director.
Failure to deliver company accounts may also result in the company being struck off from the public register. Many people are surprised how quickly a company can find itself faced with deregistration. The process is detailed in section 1000 of the Companies Act 2006. If you fail to deliver your company accounts on time the registrar will be deemed to have
reasonable cause to believe that [the] company is not carrying on in business or in operation
As a first step Companies House will send a warning letter to the company registered office address. If it fails to receive a response from the company within 14 days, it will issue a second warning letter. If the company fails to reply to this second warning letter within a further 14 days, the registrar can issue a formal Notice of the intention to strike off and this will be published in the Gazette. Just two months after the publication of the notice, the company can be deregistered.
3 My company accounts filing deadline falls on a Sunday. Can I deliver the accounts on the first working day after the weekend?
No. If your accounts due date falls on a Sunday or Bank Holiday you must ensure that you deliver your company accounts before this date or you will incur an automatic fine.
4 Can I change the accounting reference date?
Yes. You may change the accounting reference date as many times as you like if it shortens the accounting period, but if the change lengthens the accounting period then the following restrictions apply:
- Unless the company is in administration – you cannot change the accounting reference date to make the accounting period longer than 18 months.
- You cannot extend the accounting period more than once every 5 years unless your company is in administration or you have obtained permission from the Secretary of State or the change is to make the accounting reference date the same as a subsidiary or parent undertaking.
To change your accounting reference date you must apply to Companies House before you reach the current filing deadline. To apply you can complete paper Form AA01 or register with a free records management service like Inform Direct to submit the request electronically in a matter of moments.
5 Can shortening the accounting period extend the deadline for filing accounts?
The surprising answer to this questions is ‘Yes!’ – but only in certain circumstances. When a Form AA01 is filed to change the accounting reference date, the deadline for filing company accounts is extended to the later of:
- 9 months for a private company (or 6 months for a public company) from the new accounting reference date; or
- 3 months from the date of receipt of the Form AA01.
In some circumstances therefore, shortening the accounting period may actually result in the company receiving additional time to file their accounts. Consider the following example:
Company A has an accounting year end date of 30 June 2018. Assuming it is a private limited company, it’s company accounts should be filed by 31 March 2019 (being 9 months after 30 June 2018).
However, on 28 March the company submit a Form AA01 to shorten their accounting reference date by one day to 29 June. The Form AA01 is accepted, and as a consequence of this filing the company can now file their accounts 3 months from 28 March (the date the Form AA01 was filed). The company has shortened its accounting period by 1 day, but has extended the company accounts filing deadline by 3 months in the process.
However, note that Companies House do not look favourably upon companies that shorten their accounting reference period purely to gain additional time to file their accounts and may even consider it an indication that the company is experiencing financial or administrative difficulties. Indeed, the government is currently considering a proposal to limit the number of times that a company can shorten its accounting reference period, in an attempt to diminish the ability of some companies to abuse this procedure.
6 My company is dormant - do I need to file dormant company accounts with Companies House?
Yes. All private and public limited companies must file their accounts with Companies House, regardless of their size and whether or not they have carried out any trading activities.
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The only small exemption to this rule is for dormant subsidiaries with an EEA registered parent company – who may in certain circumstances avoid preparing and filing company accounts.
7 Are the filing deadlines for dormant company accounts different?
8 Who else should I file my company accounts with?
You must send a copy of the company accounts to:
- Every shareholder in the company;
- Every holder of the company’s debentures; and
- Every person that is entitled to receive notice of general meetings.
Note that the company accounts prepared and filed with Companies House may not always be suitable for presentation to the members of the company. For example, a private company that qualifies as “small” may deliver an abridged set of accounts to Companies House consisting of an abbreviated balance sheet and accompanying notes together with an auditor’s report when applicable. However, the accounts prepared for the company’s shareholders would generally include a full balance sheet and notes, together with a profit and loss account, directors report and auditor’s report (if applicable).
As well as sending a complete set of accounts (i.e. not abbreviated) to the company’s members, you should also submit a copy to HMRC as part of your Company Tax Return. Where applicable, the Charity Commission or other regulatory bodies may also require a set of your company accounts for review.
All companies are required to maintain up to date company records. Inform Direct is the perfect tool to help you easily keep everything up to date.
A previous version of this article was originally published on 29 June 2015.