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1. Directors and secretaries
1.1 Director responsibilities
Directors have a responsibility to prepare and deliver documents, on behalf of the company, to us as and when required by the Companies Act. These include:
- the confirmation statement
- the annual accounts
- notification of any change in the company’s officers or in their personal details
- notification of a change to the company’s registered office
- allotment of shares
- registration of charges
- notification of any change in the company’s PSC details or the required statements associated with them
1.2 Differences between a service address and usual residential address
A service address is one that can be used by a director to receive communications from third parties about the company. The service address can be the same as the person’s residential address, or the registered office address of the company, or it can be somewhere different.
A residential address is the usual home address of the director concerned. It has to be filed with the registrar but it won’t be available on the public record for everyone to see and will be held on a private register only available to predetermined organisations.
1.3 Differences between a register of directors and a register of directors’ residential addresses
The register of directors contains for each director who is an individual:
- their name and any former name
- a service address (which may be stated to be “the company’s registered office”)
- the country or state or part of the United Kingdom where they are usually resident
- nationality, business occupation (if any), and date of birth
For directors that are companies or firms, the register of directors will include:
- its corporate or firm name
- its registered or principal office
- in the case of an EEA company, where it is registered and its registration number; otherwise, the legal form of the company or firm and the law by which it is governed and, if applicable, where registered and its registration number
The register of directors’ residential addresses contains the usual residential address of every director who is an individual. Provided that a director’s service address is not the company’s registered office, the entry may be to the effect that the usual residential address is the same as the service address.
The register of directors must be kept available for inspection; the information on the register of directors’ residential addresses must not be revealed. The company can only use the information in this register to communicate with the director and to deliver information for us to update our records. The company can’t use this information for any other purpose unless either the director has given his consent or if so required by the court.
1.4 When a residential address is supplied to Companies House
Residential addresses won’t appear on the public record so long as you only provide them in the correct part of the appointment or change of details forms. For paper forms this will be a separate page, for electronic filings this will be additional address fields. We’ll only provide residential address information to credit reference agencies (CRAs) and specified public authorities (SPAs). See guidance on restricting the disclosure of your address.
1.5 The role of a company secretary
Private companies don’t have to appoint a secretary unless required by their articles of association.
A public limited company (PLC) must have at least one secretary. More details about the appointment of a secretary to a PLC can be found in our incorporation and names guidance.
The legislation doesn’t set out the role of the company secretary. This is normally contained in their contract of employment. However, the company secretary might normally undertake the following:
- maintaining the statutory registers
- ensuring that the company files statutory information promptly
- providing members and directors with notice of meetings
- providing members with proposed written resolutions and auditors with any resolutions it has passed
- delivering copies of resolutions and agreements to Companies House
- supplying a copy of the accounts to every member of the company, every debenture holder and every person who is entitled to receive notice of general meetings
- keeping, or arranging for the keeping of copies of all members’ resolutions (passed other than at general meetings), and minutes of all proceedings and general meetings
- ensuring that people entitled to do so can inspect company records
- custody and use of the company seal (if the company chooses to have one)
- be a co-signator for execution of a document by a company
- authenticating forms for submission to Companies House (a company secretary cannot authenticate the company’s annual accounts)
The secretary is an officer of the company and may be criminally liable for defaults committed by the company.
1.6 The rights of a company secretary
The rights of a company secretary depends on the terms of their contract and is an internal company matter between the secretary and the company.
The qualifications required by a public company secretary can be found in our guidance on incorporation and names.
2. PSC (people with significant control)
2.1 Definition of a PSC
A person with significant control (PSC) is anyone in the company who meets one or more of the conditions listed in the People with Significant Control Regulations 2016. A company can have more than one PSC. A PSC is a person who:
- holds, directly or indirectly, more than 25% of the shares;
- holds, directly or indirectly, more than 25% of the voting rights;
- holds the right, directly or indirectly, to appoint or remove a majority of directors;
- otherwise has the right to exercise, or actually exercises, significant influence or control over the company;
- has the right to exercise, or actually exercises, significant influence or control over the activities of a trust or firm which is not a legal person, the trustees or members of which would satisfy any of the four conditions above.
For most small companies, their PSCs are likely to fall into the first and second, and possibly the third, category above. The fourth and fifth categories are typically associated with more complex corporate structures.
Companies have to deliver information regarding their PSCs to us on incorporation and afterwards keep that information up to date.
2.2 The PSC register
All companies must keep a register of its PSCs. This is in addition to keeping other information, such as a register of members and a register of directors. You’re required to determine who has a controlling interest in your company and put this information into your register.
Companies must only enter the details of individuals who are PSCs into their PSC register after the individual has confirmed those details. The details of other entities can be entered into the PSC register as soon as your company has them.
In situations where companies don’t have a PSC or can’t provide confirmed details of their PSC, one of a number of possible statements must be entered into the PSC register. If your PSC register contains one or more of these statements, that information must be provided to us within 14 days of the changes being made in the PSC register.
The statements are as follows:
- the company knows or has reasonable cause to believe that there is no registrable person or registrable relevant legal entity in relation to the company
- the company knows or has reasonable cause to believe that there is a registrable person in relation to the company but it has not identified the registrable person
- the company has identified a registrable person in relation to the company but all of the required particulars of that person have not been confirmed
- the company has not yet completed taking reasonable steps to find out if there is anyone who is a registrable person or a registrable relevant legal entity in relation to the company
- the company has given a notice under section 790D of the Act which has not been complied with
- the addressee has failed to comply with a notice given by the company under section 790E of the Act
- the company has issued a restrictions notice under paragraph 1 of Schedule 1B to the Act.
Companies are also required to note in their PSC register when the above statements are no longer applicable, because their circumstances with regard to their PSC have changed. These must also be sent to us on the appropriate forms. The date that the statements are entered into the register, or are no longer applicable, must also be noted in the register. See the PSC guidance for more information.
2.3 Categories of PSC
There are 3 types of entity in law whose details must be entered into a company’s PSC register and companies must enter details of whichever is appropriate to them on the confirmation statement. The categories are individual, registrable relevant legal entity (RLE) and other registrable person.
Further information on these different categories can be found in the PSC guidance.
The following information must be provided about each:
For an individual person with significant control:
- the date that individual became a registrable person
- their name, country/state of residence and nationality
- their service address
- their usual residential address (this is not shown on the public register)
- their full date of birth (this is not shown on the public register)
- the nature of their control over the company
- the date the information was entered into the register
For a registrable relevant legal entity (RLE) (such as a company):
- the date that they became a registrable RLE
- their corporate name
- their address
- the legal form of the corporate body
- the governing law under which the RLE was registered
- where the RLE was registered (if applicable)
- the RLE’s registration number (if applicable)
- the nature of their control over the company
- the date the information was entered into the register
For an other registrable person (ORP) (such as a corporation sole or local authority):
- their name
- their principal office
- the legal form of the person and the law by which they’re governed
- the date on which they became a registrable person in relation to the company in question
- the nature of their control over the company
- the date the information was entered into the register
2.4 PSC information
Companies must send the information contained in their PSC register to us. You must deliver the information in your PSC register within 14 days of the changes you have made in your PSC register using the following notices:
|List of PSC related forms|
|Notice of individual person with significant control||PSC01|
|Notice of relevant legal entity with significant control||PSC02|
|Notice of other registrable person with significant control||PSC03|
|Notice of change of details for person with significant control||PSC04|
|Notice of change of details for relevant legal entity with significant control||PSC05|
|Notice of change of details of other registrable person with significant control||PSC06|
|Notice ceasing to be an individual person, RLE or ORP with significant control||PSC07|
|Notice of PSC statements||PSC08|
|Notice of update to PSC statements||PSC09|
You can notify us of any of these changes online via our WebFiling or software filing service, or by sending a paper form to us by post.
2.5 Restrict the disclosure of PSC information
Some companies will have PSCs whose information is protected.
This could mean that either their usual residential address (URA) is protected so it isn’t disclosed to credit reference agencies (CRAs) (s790ZF protection), all of their PSC information is protected from disclosure on the public record (s790ZG protection), or both.
Further information on restricting the disclosure of PSC information.
If you have a PSC whose URA is protected from being disclosed to CRAs, you can file relevant form (PSC01 or PSC04), as normal, digitally or on paper. There’s a box on the form(s) you should tick if an application for protection has been made or granted. The box on the form refers to an exemption under section 790ZF of Companies Act 2006.
If you have a PSC who has applied for, or been granted protection, so none of their PSC details are disclosed on the public register (s790ZG protection), you’ll need to file relevant form (PSC01,PSC04,PSC07,PSC08 or PSC09) on paper. A different version of the relevant form is used for this purpose and it’s only available from our secure registers team. A form can be requested by e-mailing the team on email@example.com, or telephoning them on 02920 348354.
2.6 Exemption from filing PSC information
Some companies are exempt from the requirement to keep a PSC register and to supply PSC information to us. This is because these companies already give information to the stock exchange about who holds a controlling interest in them. These companies will be any whose shares have been traded on a UK or EEA regulated market and companies of any description specified by the Secretary of State by regulations.
3. Company records
3.1 Company records required to be made available for inspection
A company, depending on its company type, may have some or all of the following records:
- register of people with significant control (from 6 April 2016)
- historic register of people with significant control (as from 30 June 2016)
- register of members
- historic register of members (as from 30 June 2016)
- register of directors
- register of directors usual residential addresses
- directors’ service contracts
- directors’ indemnities
- register of secretaries
- records of resolutions and minutes of general meetings
- contracts or memoranda relating to purchase of own shares
- documents relating to redemption or purchase of own shares out of capital by a private company
- register of debenture holders
- report to members of outcome of investigation by public company into interests in its shares
- register of interests in shares disclosed to public company
- instruments creating charges and a register of charges
You need to keep these company records available for inspection.
3.2 Where the records can be kept
You may keep all or any of these records at the company’s registered office. The company may choose an alternative location to make these records available for inspection. The company can only have one alternative location to the registered office at any given time. That location must be in the same part of the UK as the registered office, so a company registered in England and Wales can have an alternative inspection location in England and Wales, but not in Scotland or Northern Ireland. The company may choose to keep some records at its registered office and some at its alternative inspection location provided that all the records of a type are kept together.
3.3 What you need to send us
If you don’t keep all your records at the company’s registered office, use form AD02 to tell us the address of your alternative inspection location and which records you hold there. If there’s any change in that address, tell us on form AD03. You also need to tell us when you return any of the records to the registered office, on a form AD04.
You can notify Companies House of any of these changes using our online or software filing service, or by delivering paper documents to us by post. Changes in location of the PSC register can only be notified via a paper filing.
3.4 Alternative method of record keeping
Since 30 June 2016, a company may opt out of keeping certain statutory registers. Companies can send the information required in those registers to the registrar of companies for placing on the public register at Companies House.
The registers this applies to are as follows:
- register of members
- register of people with significant control (PSC)
- register of directors
- register of directors usual residential addresses
- register of secretaries
The guide on the registers scheme contains information on what’s required to take up this option, how to maintain the information held on the public register, the implications of doing so and what happens when a company chooses to withdraw from maintaining their register(s) information on the public register.
4.1 Definition of a resolution
A resolution is an agreement or decision made by the members, a class of members, or the directors of a company to carry out certain changes. This could include resolving to change the name of the company, to alter its share capital or to change its articles.
4.2 How companies pass resolutions
The company’s members vote on whether to pass or reject a proposed course of action. Each member’s voting power will usually depend on the number of shares he or she owns. In most cases, a member who owns one share has one vote. The resolution is passed when the pre-determined majority required for the passing of the resolution is reached (such as 75% of the members for a special resolution changing the company’s name). If the necessary majority is not obtained, then the proposed resolution fails.
4.3 Who can vote
The company’s articles of association may state the conditions on members’ voting rights, but generally a member will have one vote for each share he or she holds on a written resolution or one vote on a show of hands at a general meeting unless a poll is called. If someone validly calls for a poll at a general meeting, then each member has one vote for each share that he or she holds.
If a member is unable to be present at the meeting, he or she may appoint a proxy to vote for them. In the case of joint holders of shares it is the vote of the holder named first in the register of members that will be counted, unless the company’s articles say something different.
4.4 Who receives copies of the resolution before and after approval
The company must circulate notice of the intention to propose a resolution to its members. If a company has auditors, it must send copies or otherwise notify them of the contents of all proposed resolutions. The Companies Act requires that you deliver certain resolutions (for example any special resolution) to Companies House within 15 days of passing them.
4.5 Private companies and the passing of resolutions
Private companies can pass resolutions:
- by a written resolution, which they must circulate to every eligible member electronically or by hard copy
- by taking a vote at a meeting of members
The Companies Act has the effect that private companies no longer have to hold annual general meetings (AGMs). New provisions regarding written resolutions enable private companies to dispense with general meetings altogether, except for two limited purposes.
4.6 Written resolutions and private companies
Private companies can pass almost all resolutions as written resolutions, such as a resolution that has been circulated, either on paper or electronically, to the members without the need for a meeting.
Exceptions to this are:
- a resolution to remove a director
- a resolution to remove an auditor
These resolutions need to be passed at a general meeting
4.7 Public companies and the passing of resolutions
Public companies have to hold AGMs within 6 months of their financial year ends in addition to any other meetings held during that period. A public company can only pass a resolution by taking a vote at a meeting of the members, which may be the AGM. It can’t pass a written resolution.
4.8 Records of resolutions and meetings to be kept by the company
The company must keep minutes of all proceedings at general meetings or decisions made by a sole member. They must also keep copies of all resolutions of members passed other than at general meetings. They must keep these records for 10 years and make them available for inspection by members on request.
4.9 Resolutions and meetings
The vote on a resolution in a general meeting is by a show of hands unless the members call for a poll. A poll is a vote based on the number of shares held by people rather than on a show of hands. A declaration by the chairman that the resolution is carried on a show of hands is all that is required for a resolution to be passed, but this does not apply if the members call for a poll. You don’t have to count the number of votes for or against on a show of hands.
A private company must give a minimum notice of 14 days of a general meeting. A public company must give a minimum of 21 days notice of its AGM unless the company’s articles specify a longer period of notice. A company may call a general meeting at shorter notice, with a majority of 90% of the voting rights in the case of a private company and 95% in the case of a public company. This doesn’t apply to AGMs of a public company, where all members must agree. Notices for public companies’ AGMs must state that the meeting is an AGM.
Companies may give notice of a meeting:
- by electronic form
- in hard copy form
- by means of a website
- a combination of any of the above
The notice must state the time, date and location of the meeting and any resolutions to be agreed.
4.10 More information on resolutions
You can find further information on resolutions and meetings in the Companies Act 2006 Part 13.
5. Change of constitution
5.1 Amending company objects
Companies registered under the Companies Act 2006 have unrestricted objects. However, they may choose to restrict them in their articles by passing a special resolution and completing the “statement of objects” on a form CC04. The amendment to the objects is not effective until the form has been registered by Companies House. The company must also file a copy of the revised articles within 15 days of the date the resolution was passed or made.
Companies registered under the 1985 or earlier Companies Acts can also amend their articles to take advantage of these provisions. Although their objects are listed in their memorandum these will be deemed to form part of the articles and they are required to send a copy of the resolution and a copy of the amended articles (within 15 days of the date that the resolution was passed or made) or the memorandum if the company has amended its memorandum. Companies amending their articles to add, remove or alter objects must send a form CC04. The amendment to the objects is not effective until the form has been registered by us.
5.2 When to use form CC05 Change of constitution by enactment
Legislation can alter a company’s constitution. This can be general legislation, for example a new Companies Act provision rendering void certain provisions of all company’s articles. A private Act of Parliament can also alter the constitution by amending the articles of a company established by an earlier Act.
Where this occurs, the company must tell us on form CC05 Change of constitution by enactment. If a special enactment makes the change, you must send a copy of the enactment with the form CC05.
The company must file a copy of the altered document(s) within 15 days of the enactment taking effect only when the company’s articles, resolutions and agreements affecting the constitution are amended as a result of this enactment.
5.3 When to use form CC06 Change of constitution by order of court or order authority
The Charity Commission, for example, can alter by order a company’s constitution. Companies must tell us on form CC06 Change of constitution by order of court or other authority, along with a copy of the order. The company must send a copy of the altered documents only when this order alters the company’s articles or a resolution or agreement affecting the company’s constitution.
You can find further information on a company’s constitution in Part 3 of the Companies Act 2006.
6. Share capital
6.1 Share capital
When people form a company, they decide whether to limit the members’ liability by shares.
On registration of a company limited by shares at Companies House, the shareholders must agree to take some, or all, of the shares. The statement of capital and initial shareholdings must show the names and addresses of the people who have agreed to take shares and the number of shares each will take. These people are called the subscribers.
6.2 Issued capital
Issued capital is the value of the shares issued to shareholders. This means the nominal value of the shares rather than their actual value.
A company may increase its issued capital by allotting more shares. It must make allotments under proper authority.
- A private company may normally only issue shares to its members, to staff and their families, to debenture holders, or to others by private arrangement
- A PLC may offer shares to the general public in a prospectus or by listing particulars
6.3 Types of shares
A company may have as many different types of shares as it wishes, all with different conditions attached to them. Typically, share types fall into the following categories:
- Ordinary: These are the ordinary shares of the company with no special rights or restrictions. The company may divide them into classes of different values
- Preference: These shares carry a right that the company should pay any annual dividends available for distribution on these shares before other classes
- Cumulative preference: These shares normally carry a right that, if the company cannot pay the dividend in one year, it will carry it forward to successive years
- Redeemable: These shares are issued by the company with an agreement that it will buy them back at the option of either the company or the shareholder after a certain period, or on a fixed date. A company cannot have only redeemable shares
6.4 PLCs and the authorised minimum
A PLC cannot conduct business or exercise borrowing powers unless and until it has obtained a trading certificate from Companies House, and Companies House will not issue a trading certificate unless satisfied that the company satisfies the ‘authorised minimum’ share capital requirement. In order to satisfy the requirement and obtain a trading certificate, the nominal value of the company’s allotted share capital must be at least £50,000 or €57,100. The company cannot satisfy the requirement by a combination of euro and sterling shares or by shares in any other currency. To apply for a trading certificate, the company must deliver form SH50 to Companies House.
A company re-registering from a private company to a PLC does not have to apply for a trading certificate. However, in order to re-register, the nominal value of its allotted share capital must not be less than the authorised minimum and the authorised minimum requirement must be satisfied either entirely in sterling shares or entirely in euro shares.
When applying for a trading certificate (or for re-registration), if the company could meet the authorised minimum in either sterling or euro shares you will need to state in your application whether you are satisfying the authorised minimum requirement in sterling or in euros.
### Statement of Capital
Throughout this guidance you’ll see references to a statement of capital. The Companies Act 2006 introduced this for all companies with share capital.
The statement of capital is a snapshot of a limited company’s share capital at a given time.
Companies incorporating with share capital on or after 1 October 2009 must complete a statement of capital and initial shareholdings as part of the application to incorporate.
All companies with share capital must complete a statement of capital as part of any annual return filing made up to a date on or after 1 October 2009. From 30 June 2016 the annual return is being replaced by the confirmation statement, companies are required to file a copy of their most recent statement of capital alongside the confirmation statement if the registrar does not already hold this information.
Companies must complete a statement of capital with certain forms that notify capital changes, namely:
|Form notifying changes in capital|
|Allotment of shares||SH01|
|Notice of consolidation, sub-division of shares or reconversion of stock into shares or redemption of redeemable shares||SH02|
|Redenomination of shares||SH14|
|Reduction of capital as a result of redenomination||SH15|
|Cancellation of repurchased shares or immediate cancellation of shares repurchased into treasury||SH06|
|Subsequent cancellation of shares held in treasury||SH05|
|Cancellation of shares held by or for a PLC accordance with section 662 of the Companies Act 2006||SH07|
In all the circumstances listed above, the statement of capital will be an integral part of the appropriate form.
There will be occasions where a limited company needs to file a ‘stand-alone’ statement of capital, for example to accompany a reduction of share capital approved by the court or (in the case of a private company) supported by solvency statement, and (in some instances) when re-registering from an unlimited to a limited company. A statement of capital Form SH19 will be available for these purposes.
The statement of capital must show the following details of the capital:
- the total number of shares of the company
- the aggregate nominal value of those shares
- for each class of shares-
- prescribed particulars of the rights attached to the shares
- the total number of shares of that class
- the aggregate nominal value of shares of that class
- the aggregate amount (if any) unpaid on those shares (whether on account of their nominal value or by way of premium)
6.5 Allotment of shares
A company may increase its share capital by allotting additional shares. Shares are issued when a person is registered as a member in the company’s register of members.
6.6 Authority to allot
Allotment is the process by which a person acquires an unconditional right to be issued with shares. Directors allot shares on the company’s behalf, but either the company’s articles or a resolution of the company needs to authorise them to do so.
(An exception to this is that a private company incorporated under the 2006 Companies Act, that will only have one class of shares following the allotment, does not need any prior authorisation from the company to allot shares unless there is a specific restriction in the articles. Private companies incorporated before this date will need to pass an ordinary resolution to qualify for this exemption, provided there is no specific restriction in their articles).
6.7 Payment for shares
Payment for shares in a private company can be in a variety of ways including cash, goods, services, property, good will, know-how, or even shares in another company.
Generally, people can pay for shares in a private company;
- wholly for cash
- partly for cash and partly for a non-cash payment
- wholly for a non-cash payment
Payment for shares in a public company must, in most instances, be for cash. However, if shares are allotted in a public company for a non- cash consideration, the consideration for the shares is subject to an independent valuation in most cases. You must send a copy of the individual valuation report to the proposed allottee for the shares and to Companies House when registering the form SH01.
6.8 Notice of allotment
Within one month of the allotment of shares, a limited company must deliver a return of allotment, on form SH01, to Companies House. You must complete a statement of capital as part of this form.
If you are a limited company and the person pays for the shares in cash, you must include in the return details of the actual amount paid or unpaid.
If the company allots shares fully or partly for a non-cash element, you must show the extent to which the company has treated the shares as paid-up on the form SH01 and you must also include a brief description of the non-cash payment for the shares.
You can notify a series of allotments on the same form SH01, but you must send the form to us no later than one month after the date of the first allotment. If you do this, the statement of capital should reflect the company’s position following the ‘last’ allotment.
The company must tell us about the allotment of bonus shares on form SH01. It should show the amount paid on each share as ‘nil’ or ‘0.00’ and the shares as paid up ‘otherwise than in cash’.
An unlimited company only needs to tell us if it’s allotting a new class of shares (such as a class of shares which have rights that differ in any way to any previously allotted shares). You must complete and deliver a form SH09.
6.9 Redenomination of share capital
Under the Companies Act 2006 any company limited by shares can (subject to prohibition or restriction in its articles) re-denominate its share capital, or any class of its share capital, into other currencies by passing a resolution.
The company must use an appropriate ‘spot rate’ of exchange used for the redenomination – this must either be a rate prevailing on a particular day specified in the resolution, or the average rate taken from each consecutive day of a period specified in the resolution, (and the day or period chosen must be within the period of 28 days ending on the day before the resolution is passed).
You should follow a three-step route, for each class of shares, to calculate the new nominal value of each share in the class:
- take the aggregate (total) of the old nominal values of all the shares of that class
- translate that amount into the new currency at the rate of exchange specified in the resolution
- divide that amount by the number of shares in the class
You must, within one month of the redenomination taking effect, deliver form SH14 (which includes a statement of capital) to us, as well as a copy of the resolution.
6.10 Sub-division and consolidation of shares
Unless its articles of association prohibit or restrict it, a company may pass an ordinary resolution to:
- sub-divide its shares, or any of them, into shares of smaller amounts, for example, it may divide a £1 share into 10 shares of 10p
- consolidate and divide its share capital into shares of larger amounts than its existing shares, for example it may consolidate and divide 200 shares of £1 into 100 shares of £2
- reconvert any stock into paid up shares of any nominal value
In the above cases, the total share capital remains unaltered. A company must deliver notice of the change to Companies House on Form SH02 (which includes a statement of capital) within one month of the alteration.
6.11 Variation of class rights
Rights attached to a class of shares (‘class rights’) typically cover matters such as voting rights, rights to dividends and rights to a return of capital on winding up.
The articles of association may set out class rights and may contain provisions for altering (“varying”) those rights
If the articles don’t contain provisions for varying the rights, the company can vary them either by obtaining consent from the holders of at least three quarters in nominal value of the issued shares of that class (excluding any treasury shares), or by the members of that class passing a special resolution at a separate general meeting.
You must deliver a copy of the special resolution to us within 15 days. You must also deliver a form SH10 (notice of particulars of variation of rights) to us within one month of the date of variation.
The holders of not less than 15% of the aggregate of the issued shares of the class in question, disregarding any treasury shares in the class, are (if they did not consent to the variation) entitled to apply to the court to cancel the variation. They must make the application no later than 21 days after the consent was given, or the resolution passed.
The court may confirm or cancel the variation and the company must deliver a copy of the court order to us no more than 15 days after it is made.
6.12 New name or designation of class of shares
A company can give a name or designation to a class of shares (or a new name or new designation). You must deliver form SH08 to tell us about this change.
6.13 Reduction of capital
A company cannot generally reduce its share capital otherwise than as permitted by statute and confirmed by the court. However, under the Companies Act 2006, a company can reduce its capital in the following circumstances:
Reduction following redenomination
A company can reduce its capital following a redenomination of its share capital under the new procedure in the Act (see above), but this can only be done so as to obtain more suitable nominal values for the redenominated shares, e.g. if the redenomination results in nominal values that are not whole units of the new currency.
The company must pass a special resolution (within 3 months of passing the resolution to redenominate) and within 15 days deliver a copy of that, as well as form SH15 (which includes a statement of capital) to Companies House.
You must also deliver a director’s statement confirming that the reduction does not exceed 10% of the nominal value of allotted shares immediately following reduction.
Reduction supported by a solvency statement
A private limited company can reduce its capital by special resolution supported by a solvency statement (so long as the reduction does not result in only redeemable shares being held). You must deliver to Companies House:
- a copy of a special resolution authorising the capital reduction
- a copy of the solvency statement made in accordance with sections 642(1)(a) and 643 of the Companies Act 2006
- a statement of capital
- a statement of compliance by the directors
- a fee of £10 for the standard service or £50 for the same day service
All the company directors must sign the solvency statement.
A statement of compliance by the directors confirms that the company made a copy of the solvency statement available to each of the eligible members as required and that the directors did not make the solvency statement more than 15 days before the company’s members passed the resolution. All the directors must sign this statement of compliance.
All of these documents must be delivered to Companies House within 15 days of the resolution being passed. Wherever possible, you should deliver all the forms together. The reduction of capital will not take effect until we’ve registered a copy of the solvency statement, resolution and statement of capital.
Reduction confirmed by a court order
A company can reduce its capital by passing a special resolution and obtaining confirmation of the reduction from the court. You must also prepare a statement of capital and get this approved by the court.
You must then deliver the original and a copy of the court order to us, along with the statement of capital and a fee of £10 for the standard service or £50 for the same day service. In most instances, the reduction won’t take effect until Companies House has registered the copy of the court order and the statement of capital.
However, the ‘authorised minimum’ requirement constrains public companies. If a capital reduction brings the nominal value of a PLC’s allotted capital below the authorised minimum, it will generally need to re-register as a private company. For this purpose, however, a public company can satisfy the authorised minimum requirement by means of shares denominated in multiple currencies.
6.14 Cancellation of shares by a PLC following forfeiture or surrender
If shares in a PLC have been forfeited, surrendered or acquired in various circumstances described in section 662 of the Companies Act 2006, the company must (unless the shares or the company’s interest in them is disposed of in some other way) cancel those shares, generally within three years (in some cases within one year), and reduce its capital by the nominal value of the cancelled shares. The directors may reduce the company’s capital without a special resolution approved by the court. Within one month of the cancellation you must deliver Form SH07 (which includes a statement of capital) to Companies House. If the reduction in capital results in the nominal value of the company’s allotted share capital falling below the authorised minimum the company must re-register as a private company. (The time limit for re-registration is the same as that for cancellation of the shares).
6.15 Redemption of shares
If a private company or plc has issued redeemable shares, it may redeem the shares in accordance with the terms of redemption. The directors may, if authorised either by the company’s articles or by a resolution, set the terms of redemption. Otherwise, the terms must be stated in the company’s articles. When shares are redeeming in a company, you must deliver Form SH02 (which includes a statement of capital) to Companies House within a month of the redemption.
6.16 Purchase of own shares
Subject to any restriction or prohibition in the articles and the approval of its shareholders, a company can purchase its shares. But it cannot do so if this would leave only redeemable shares in issue.
You must notify the purchase to Companies House on Form SH03 within 28 days.
When a company purchases its own shares, it cancels the shares on their return. If it cancels the shares immediately, it must deliver Form SH06 (which includes a statement of capital) to Companies House.
However, a company may either cancel those shares immediately or hold them ‘in treasury’ for resale or transfer to an employees’ shares scheme at a later date (or it may cancel them at a later date).
You must notify the initial purchase of ‘treasury’ shares to Companies House on Form SH03 and if you are cancelling those treasury shares immediately you must file Form SH06.
If you sell or transfer the shares from treasury, you must deliver Form SH04 and if you subsequently cancel the shares, you must deliver Form SH05 (which includes a statement of capital).
A purchase of a company’s own shares may be subject to stamp duty. If the consideration for the shares is above £1000, HM Revenue & Customs (HMRC) must stamp the Form SH03 before it is delivered to Companies House,
If the consideration is £1000 or less, you need not send the form to be stamped, but you must sign the certification on the form.
You may use a single Form SH03 to notify Companies House of purchases of shares on different dates and under different contracts.
6.17 Redemption or purchase of shares out of capital
A private company can, subject to any restriction or prohibition in the articles, pass a special resolution to finance a purchase or redemption of shares out of capital.
If the purchase out of capital is being made for the purposes of, or pursuant to an employee’s share scheme, it can be approved by a special resolution, supported by a solvency statement.
You must deliver to Companies House:
- a copy of the special resolution authorising the capital reduction
- a copy of the solvency statement made in accordance with section 643 of the Companies Act 2006
- a statement of capital
- a statement of compliance by the directors
Section 643(3) states that ‘The solvency statement’ must be in the prescribed form and must state:
- the date on which it is made
- the name of each director of the company
The ‘prescribed form’ is set out in The Companies (Reduction of Share Capital) Order 2008, which states that a solvency statement must be in writing, indicate that it is a solvency statement for the purposes of section 642 of the Act and be signed by each of the directors
All of the company directors must sign the copy of the solvency statement which is sent to Companies House.
A statement of compliance by the directors confirms that the company made a copy of the solvency statement available to each of the eligible members as required and that the directors did not make the solvency statement more than 15 days before the company’s members passed the resolution. All of the directors must sign this statement of compliance.
All of these documents must be delivered to Companies House within 15 days of the resolution being passed. Wherever possible, you should deliver all the forms together. The reduction of capital will not take effect until Companies House has registered a copy of the solvency statement, resolution and statement of capital.
If a private company finances a purchase by a payment out of its capital and the purchase is not for the purposes of, or pursuant to an employee’s share scheme, the directors must also make a statement about the solvency of the company immediately after the purchase and in the following year. All of the company directors must sign the solvency statement.
You must make a copy of the statement and auditor’s report confirming the directors’ opinion available to the members at or before the time you deliver the resolution to them in the case of a written resolution. Or, if the resolution is to be passed at a meeting, by making a copy of the directors’ statement and auditor’s report available for inspection at that meeting. You must also deliver a copy of the directors’ statement and auditors report to Companies House no later than the day on which you first publish or give notice of the proposed payment out of capital (requirements for publishing and giving notice are covered by section 719 of the Companies Act 2006).
Any member of the company who did not consent or vote in favour of the resolution or any creditor of the company can apply to court to cancel the resolution, within five weeks of the passing of the resolution.
The applicants to court must complete and deliver Form SH16 to Companies House immediately.
When a company receives notice of the application to court, it must immediately notify Companies House on Form SH17 and, within 15 days of the making of a court order, the company must deliver a copy of the order to Companies House.
For further information on share capital and its maintenance, please refer to Parts 17 and 18 of the Companies Act 2006 (as amended).
A company may alter its status and re-register in a number of ways
- from a private company (limited by shares or unlimited) to a public company
- from a public company to a private company limited by shares
- from a private limited company to an unlimited company
- from an unlimited private company to a limited company
- from a public company to an unlimited private company
On re-registration, Companies House will issue an amended certificate of incorporation to the company. The certificate will include the changed name and status of the company together with the date of re-registration.
7.1 Re-registration from a private company to public
A private company with a share capital may re-register as a public company by passing a special resolution to do so.
You must deliver the application to re-register as a public company to Companies House on Form RR01, accompanied by;
- a copy of the special resolution
- a printed copy of the amended articles of association
- a copy of the relevant balance sheet
- a copy of the auditor’s written statement
- a copy of the auditor’s unqualified report
If the company re-registering does not have a secretary, the application to re-register should include a statement of the proposed secretary. It must also include a copy of the valuation report in the event of a recent allotment of shares for a non- cash consideration.
7.2 Re-registration from a public company to private
There are four ways in which a public company can re-register as a private company;
- by passing a special resolution to do so and then making an application in accordance with section 100 Companies Act 2006
- following a court order to reduce capital
- following a cancellation of shares
- following a reduction of capital due to a redenomination of shares
7.3 Re-registration from public to private in accordance with section 100 of the Companies Act 2006
A public company can re-register as private by passing a special resolution to do so. You must deliver the application to re-register to Companies House on Form RR02. This should be accompanied by a copy of the special resolution and a printed copy of the amended articles of association.
If sufficient members of the company object to the passing of the resolution, they can apply to the Court to cancel the resolution within 28 days of the passing of the resolution. If they raise such an objection they must make the company aware of it. The company, in turn, must notify Companies House of the application to Court on the Form RR03. The Court may either cancel or confirm the resolution upon hearing such an application. The company must deliver a copy of the court’s order to Companies House within 15 days of the order being made.
7.4 Re-registration from public to private following a court order to reduce capital
A public company can re-register as private if the court directs it to. Where a company has applied to the court for a reduction in share capital (as described in chapter 7) and this results in the nominal value of its allotted share capital falling below the authorised minimum for a public company, the court can authorise the company to be re-registered as private without the need to pass a resolution.
You must deliver the application to re-register to Companies House on Form RR08 accompanied by a copy of the court order and a printed copy of the amended articles of association.
7.5 Re-registration from public to private following a cancellation of shares.
A public company must re-register as private following a cancellation of its shares in certain circumstances. Where the cancellation of the shares (as described in chapter 7) results in the nominal value of its allotted share capital falling below the authorised minimum for a public company, the company must re-register as a private company. The directors can pass a resolution to re-register as private.
You must deliver the application to re-register to Companies House on Form RR09 accompanied by a copy of the director’s resolution and a printed copy of the amended articles of association.
7.6 Re-registration from a private limited company to unlimited
A private limited company may re-register as unlimited by delivering Form RR05 to Companies House, accompanied by a prescribed form of assent and a printed copy of the amended articles of association.
The form of assent is to show that all members have agreed to the re-registration, and so it must be authenticated by or on behalf of all the members of the company and is prescribed in regulations.
7.7 Re-registration from an unlimited company to private
An unlimited company may re-register as private limited by shares or guarantee by passing a special resolution. You must deliver the application to re-register as private to Companies House on Form RR06 accompanied by a copy of the special resolution and a printed copy of the amended articles of association.
In certain circumstances, where the company is re-registering as private limited by shares, a statement of capital must accompany the application. If the company is re-registering as private company limited by guarantee, you must complete the statement of guarantee on Form RR06.
7.8 Re-registration from a public to private unlimited
A public company may re-register as unlimited by delivering Form RR07 to Companies House accompanied by a prescribed form of assent and a printed copy of the amended articles of association.
The form of assent is prescribed in regulations and is to show that all members have agreed to the re-registration, and so all the members of the company must authenticate it.
Further information on re-registration can be found in Part 7 of the Companies Act 2006.
A charge is the security a company gives for a loan. A company that creates a charge (or any person interested in the charge) may deliver the statement of particulars, together with a certified copy of the charge instrument (if there is one), along with the relevant fee, to the registrar for registration (please note, for charges created before 6 April 2013, by a company registered in England and Wales or Northern Ireland, you must send the original charge instrument – not a certified copy)
If a company creates a charge and the required documents and fee are not delivered to the registrar for registration within the period allowed for delivery and in the event that the company becomes insolvent, the charge will be void against the liquidator or administrator and any creditor of the company. This means that the debt for which the charge was given will remain payable, but it will be unsecured. Only the court can grant an extension of time for registration of a charge that Companies House did not receive in time.
The period allowed for delivery is 21 days – details are set out in the table in question 1b alongside the description of the form
There is a single, UK-wide regime for registering charges created on or after 6 April 2013. This means that all UK registered companies will deliver the same forms to Companies House. The only form that continues to apply specifically to charges registered on or after 6 April 2013 in Scotland is form 466 Particulars of an instrument of alteration to a floating charge.
8.1 Registration of charges on or after 6 April 2013
Charges created on or after 6 April 2013 which you may register
All charges may be registered, unless they are specifically excluded. Those charges excluded are;
- a charge in favour of a landlord on a cash deposit given as a security in connection with the lease of land.
- a charge created by a member of Lloyd’s (within the meaning of the Lloyd’s Act 1982) to secure its obligations in connection with its underwriting business at Lloyd’s.
- a charge that any other Act specifically excludes from registration (for example, the Financial and Collateral Arrangements (No. 2) Regulations 2003)
Using the correct form
Charges created on or after 6 April 2013
|Form title||form number||21 day submission time limit|
|Particulars of a charge||MR01||Yes|
|Particulars of a charge subject to which property or undertaking has been acquired||MR02||No|
|Particulars for the registration of a charge to secure a series of debentures||MR03||Yes|
|Statement of satisfaction in full or part of a charge||MR04||No|
|Statement that part or the whole of the property has been released from the charge or no longer forms part of the company’s property||MR05||No|
|Statement of company acting as a trustee||MR06||No|
|Particulars of alteration of a charge (particulars of a negative pledge)||MR07||No|
|Particulars of a charge where there is no instrument||MR08||Yes|
|Statement of satisfaction in full or part of a charge||MR09||No|
|Statement that part or the whole of the property has been released from the charge or no longer forms part of the company’s property||MR10||Yes|
|Statement of company acting as a trustee||RM01||No|
|Statement of company acting as a trustee||RM02||No|
Forms MR01, MR02, MR04 and MR05 can be delivered electronically using either online filing or software filing. This is the quickest, cheapest and most efficient way to file.
To file using WebFiling, you will need to register for WebFiling (if you haven’t already done so) and (unless it is the company that created the charge who is filing) apply for a Lender Authentication Code (LAC). Companies House will create a LAC, as well as a presenter ID and a presenter authentication code.
Companies may file charges against their own company using the company authentication code and will not need to obtain a LAC for this purpose.
If you want to file using software filing, you will need to apply for an account and either use your own software or use one of these software suppliers.
8.2 Things to remember when filing a form MR01
The Form MR01 is the most commonly filed charge form at Companies House. (If there’s no instrument, you must use form MR08 instead.)It is important to act as quickly as possible and, when delivering the documents to Companies House, remember to:
- complete the correct form.
- check that the details on the form are correct and match the information given in the Instrument
- enclose the correct registration fee (£15 electronic, £23 paper)
- deliver it to the correct registration office (if filing on paper) while also following any relevant notes on the form
- deliver the certified copy of the instrument creating or evidencing the charge with the form
8.3 If the charge instrument contains personal information
You will be able to remove certain personal information from the certified copy of the instrument before you send it to Companies House. The information that you can remove is:
- personal information relating to an individual (other than the name of an individual)
- the number or other identifier of a bank or securities account of a company or individual
- a signature
It is up to you how you choose to remove this information.
8.4 Acquisition of property which is already charged
If you acquire property that is already subject to a charge, and the charge is of a type which is not an excluded charge, you may register this charge. The company (or any person interested in the charge) should complete and deliver form MR02 to Companies House, accompanied by a certified copy of the instrument that creates or evidences the charge.
If there is no instrument, you must send form MR09 instead.
8.5 Satisfaction of Charges
What should I do if the company has satisfied the debt?
The company does not need to inform Companies House that it has fully or partly satisfied the debt. However, it is in the company’s own interests that potential investors and lenders are aware that it has satisfied all or part of the debt. If you wish to notify Companies House, you should deliver form MR04.
What if the charged property ceases to be charged or to belong to the company?
There is no requirement for a company to inform Companies House that its property has been released from a charge or that the property no longer belongs to the company. It’s in the company’s own interests that potential investors and lenders are aware of this. If you wish to notify Companies House, you should deliver form MR05.
Further information on the Registration of Charges can be found in Part 25 of the Companies Act 2006(as amended by The Companies Act 2006 (Amendment of Part 25) Regulations 2013).
8.6 Registration of charges created before 6 April 2013
Charges created before 6 April 2013 which you must register at Companies House
For companies incorporated in England and Wales, Wales and in Northern Ireland, the charges that must be registered are:
- a charge on land or any interest in land, other than a charge for any rent or other periodical sum issuing out of land
- a charge created or evidenced by an instrument which, if executed by an individual, would require registration as a bill of sale
- a charge for the purposes of securing any issue of debentures
- a charge on uncalled share capital of the company
- a charge on calls made but not paid
- a charge on book debts of the company
- a floating charge on the company’s property or undertaking
- a charge on a ship or aircraft, or any share in a ship
- a charge on goodwill or on any intellectual property
For companies incorporated in Scotland, the charges that must be registered are;
- a charge on land or any interest in such land, other than a charge for any rent or other periodical sum payable in respect of the land.
- a security over incorporeal moveable property of any of the following categories;
- a patent or a licence under a patent
- a trademark
- a copyright or a licence under a copyright
- a registered design or a licence in respect of such a design
- a design right or a licence under a design right
- the book debts (whether book debts of the company or assigned to it)
- uncalled share capital of the company or calls made but not paid
- A security over a ship or aircraft or any share in a ship
- A floating charge
Which form should I use for charges created before 6 April 2013?
- particulars of a Charge - MG01 (or MG01s for companies registered in Scotland)
- particulars of a charge subject to which property has been acquired - MG06 (or MG06s for companies registered in Scotland)
- particulars for the registration of a charge to secure a series of debentures - MG07 (or MG07s for companies registered in Scotland)
- particulars of an issue of secured debentures in a series - MG08 (or MG08s for companies registered in Scotland)