What is the PSC Register?
The PSC (person with significant control) register came into effect on 6 April 2016 and replaces the Annual Return process.
All UK Companies and limited liability partnerships (LLPs) are now required to provide Companies House with details of their PSC register, naming the individuals and legal entities with significant control over the company.
The change has been introduced in an attempt to increase the transparency of company ownership, and the central PSC register will be made publicly available at Companies House.
What is a PSC?
A PSC is a person who meets one or more of the following conditions through direct or indirect shareholdings:
- They hold more than 25% of the company shares
- They hold more than 25% of the company voting rights
- They hold the right to appoint or remove the majority of the board of directors of the company
- They have the right to exercise, or do exercise, significant influence or control over the company
- Where a trust or firm would satisfy one of the above four conditions, they have the right to exercise, or do exercise, significant influence or control over the activities of that trust/firm.
Where a company is owned or controlled by another entity, rather than an individual, different rules apply. Where the owner or controller of a company is a legal entity (i.e. a company or LLP), the details of that legal entity will need to be entered onto the company's PSC register, providing it is a 'registrable' and 'relevant' legal entity (RRLE).
Should the identity of a PSC or RRLE not be known, you must take the necessary steps to identify them for the register. These steps typically include reviewing the shareholder register, articles of association and statement of capital.
Where there is a valid reason for a company being unable to provide PSC information, other statements will need to be made, with a full explanation as to why the PSC information is unavailable. The PSC register must never be left blank.
What information is required for the register?
The below must be confirmed with an individual before they are entered on the PSC register:
- Date of Birth
- Country, state or part of the UK where the PSC usually lives
- Usual residential address
- Service address
- The date that the individual became a PSC in relation to the company
- The nature of the individual's control over the company
- Any restrictions that have been put in place regarding the disclosure of the individual's information on the public register
The below must be confirmed with legal entities before they are entered on the PSC register:
- Entity name
- Registered address/principal office
- Legal form and governing law
- The register in which the entity appears and its registration number
- The date on which the entity became a RRLE in relation to the company
- The specific conditions for becoming a PSC and evidence that the RRLE meets these
Updating the register
Should the above information in the register need to be updated at any stage, a company must enter the updated information on its own PSC register if the company:
- has become aware of a change
- holds a copy of the information needed on its own PSC register and;
- has confirmed the details (if they relate to a PSC) and the information has not been provided by the PSC or with their knowledge
The updated information must be provided annually to Companies House as part of the confirmation statement, which has replaced the Annual Return.
Failure to provide accurate information on the PSC register, or failure to take the necessary steps to identifying the information required for the register are classed as criminal offences and may result in a fine and/or a prison sentence of up to two years.
Paul Johnston Accounts and Audit Manager at Ellis & Co, said of the changes:
“The rules on disclosure for all Limited Companies changed on 6 April 2016. This is a change in law with regard to what you need to report about the ownership of shares within your Company.
“Failure to comply with the new rules could be a criminal offence for the company and its directors. It is therefore important to ensure that you update this information if you have not done so already.”
Have a question about the PSC register? Please contact Paul Johnston on 01244 343504 or email@example.com