Companies House official statistics : definitions to accompany statistical releases
Published 24 August 2016
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1. Companies Act 2006
The Companies Act 2006 is an Act of the United Kingdom Parliament which forms the primary source of UK company law. Companies Acts have existed for over 150 years in various forms, and govern how UK limited companies operate.
The phased implementation of the Companies Act 2006, completed in October 2009, represents a comprehensive review and modernisation of the UK company law framework. The Act introduced a number of significant changes to simplify and improve company law.
2. Small Business, Enterprise and Employment Act
The Small Business, Enterprise and Employment Act received Royal Assent in March 2015. The Act contains a number of measures which together represent significant change for companies and Companies House customers. The Act changes a company’s legal requirements, including what they file with Companies House. This will impact on companies’ systems and processes.
3. Corporate Bodies and Companies
Corporate bodies and companies are specific legal forms of business that are registered at Companies House. Companies form a subset of corporate bodies and are formed under the Companies Act 2006. Corporate bodies and companies are registered at Companies House regardless of whether they go on to trade actively.
4. Company types
Companies Act 2006 companies include: Public Limited; Private Limited; Private Limited by Guarantee / No Share Capital; Private Limited by Guarantee / No Share Capital (exempt); Private Limited (s.30); Private Unlimited; Private Unlimited / No Share Capital Companies.
5. Corporate body types
Corporate bodies include Companies Act 2006 companies, plus: Old Public Companies; Converted / Closed; Limited Liability Partnerships; Limited Partnerships; Overseas, European; European Economic Interest Groupings; Newspaper Libel and Registration Act 1881; Principal Establishment in GB, European Public Limited Liability Companies (Societas Europaea); Industrial and Provident Societies; Incorporated by Royal Charter; Investment Companies with Variable Capital; Investment Companies with Variable Capital (Securities); Investment Companies with Variable Capital (Warrant); Investment Companies with Variable Capital (Umbrella); Unregistered Companies; Not Used; other types of companies.
For the purpose of the Companies Act 2006 and related legislation, the Channel Islands and the Isle of Man are not regarded as part of the UK company register.
6. Companies and businesses
The company and corporate body types described above are a subset of a wider group of business types. A company is one type of legal business structure and is defined by the fact that it is registered at Companies House. Other legal business structures, which are not registered at Companies House, include sole traders and business partnerships.
Companies House official statistics cover companies registered at Companies House only; figures do not include other business types. Information is provided in our statistical releases on official statistics published by other organisations that cover business creation and the business population.
7. Total register
The total register comprises all companies to which the Companies Act 2006 relates, which are registered with Companies House regardless of trading status. This includes both dormant and actively trading companies. It includes all companies required to file documents at Companies House. It excludes dissolved companies but includes those in liquidation, in the course of dissolution, and those in the course of receivership.
8. Effective register
The effective register comprises all companies to which the Companies Act 2006 relates, which are registered with Companies House regardless of trading status (including dormant and actively trading companies). Companies in liquidation and those in the course of dissolution are excluded from the effective register; companies in receivership are included.
8.1 Table 1: Summary of differences in the composition of the total and effective registers
| Company status | Total register | Effective register |
|---|---|---|
| Registered with Companies House: actively trading or dormant | Yes | Yes |
| In liquidation | Yes | No |
| In the course of dissolution | Yes | No |
| In receivership | Yes | Yes |
| Dissolved | No | No |
9. Incorporation
A business cannot operate as a limited company until it has been incorporated at Companies House under the Companies Act 2006. Incorporation is the process by which a new or existing business registers as a limited company. A company is a legal entity with a separate identity from those who own or run it. The vast majority of companies are limited liability companies where the liability of the members is limited by shares or by guarantee.
Establishing a company means the directors are required to file certain documents every year. Documents include annual accounts and confirmation statement (which has replaced with the annual return). Companies must inform Companies House about any changes, such as the appointment or resignation of directors or a change to the company’s registered office.
10. Dissolution
Dissolution is the act of removing an incorporated company from the Companies House register. A dissolved company is any company to which the Companies Act 2006 relates, which has been removed from the Companies House register. There are many ways in which a company can be dissolved:
- a company can be dissolved as the final outcome of insolvency procedures.
- if the Registrar has reason to believe that a company is not carrying on business or is not in operation, its name may be struck off the register and dissolved without going through liquidation.
- a private company that is dormant or no longer trading may also apply to the Registrar to be struck off the register and dissolved. The company can do this if it is no longer needed. For example:
- the directors may wish to retire and there is no one to take over the running of the company;
- the company is a subsidiary whose name is no longer needed;
- the company was set up to exploit an idea that turned out not to be feasible.
Once a company has been dissolved it is removed from the Companies House register and can only be restored under certain circumstances.
11. Restoration
There are two ways to restore a company:
11.1 Administrative restoration
Under certain conditions, where a company was dissolved because it appeared to be no longer carrying on business or in operation, a former director or member of the company may apply to the registrar to have the company restored to the register. Section 1025 of the Companies Act 2006 gives details of the requirements relating to administrative restoration.
11.2 Restoration by court order
If a company was dissolved following an application under Section 1003 of the Companies Act 2006 (voluntary dissolution), the company can only be restored by court order. A member or a creditor of the company can apply; any of the parties who must be notified of the application for strike off may also apply.
Any company which is restored to the register is deemed to have continued in existence as if it had not been struck off and dissolved.
12. Insolvency
Company insolvency proceedings are formal measures taken when a company becomes unable to pay its debts.
There are many different types of company insolvencies, including:
- compulsory liquidations and creditors’ voluntary liquidations are both procedures resulting in the final winding-up of a company.
- receiverships, administrations and company voluntary arrangements are aimed at company rescue and/or restructuring.
Another form of company liquidation, member’s voluntary liquidation, can take place when the directors of the company believe the company is solvent and will be able to pay its debts in full within 12 months from the start of the winding up process.
The Insolvency Service reports the most complete picture on insolvency statistics, as it has policy responsibility for all forms of corporate insolvency in England and Wales. Members’ voluntary liquidation is not included in the Insolvency Service’s statistics, as it does not involve insolvency.
13. Help with queries
If you have any queries relating to any of our statistical products please contact:
Jamie Cleves
Companies House
Crown Way
Cardiff
CF14 3UZ