Submit documents in other languages

As a general rule the company law requires that you deliver documents to Companies House in English, however there are exceptions which are detailed below.

English language

Your company can deliver the following documents in languages other than English if your document is accompanied by a certified translation into English:

  • Resolutions and agreements affecting your company’s constitution delivered under Chapter 3 of Part 3 of the Act.
  • Company accounts of larger EEA (European Economic Area) groups, your group accounts and parent undertaking’s annual report.
  • Company accounts of larger non-EEA groups, your group accounts and, where appropriate, the consolidated annual report.
  • A charge instrument or copy charge instrument
  • Valuation report required to be delivered to the registrar under section 94(2)(d) of the Act
  • Articles of association; memorandum of association.
  • Court orders.

Your company may also file voluntary certified translations of any document subject to the First Company Law Directive disclosure requirements. These are:

  • Constitutional documents such as your memorandum and articles of association.
  • Directors appointments.
  • Changes in particulars or terminations.
  • Company accounts, reports, confirmation statements and annual returns.
  • Notification of any change in your company’s registered office.
  • Winding up documents.
  • Share capital documents for public limited company only.
  • Documents relating to mergers and divisions for public limited company only
  • Documents relating to overseas companies.

European Union language

The voluntary translation must relate to a document delivered to Companies House on or after 1 January 2007. Voluntary translations can only be filed in an official language of the European Union and must be accompanied by Form VT01, which will link the translation to the original document.

Welsh language

There are different exceptions for Welsh company (those complying with section 88 of the Act) who are entitled to draw up and deliver certain documents in Welsh without the need of an accompanying certified translation in English.

Audit Exemption for subsidiary

Your subsidiary may claim exemption from audit if your parent is established under the law of an European Economic Area (EEA) state, in certain circumstances.

You must submit the following documents to Companies House if you would like to take up this exemption. Your documents must reach Companies House before the date on which your company accounts are due.

  • A written notice that all members of the subsidiary company agree to the exemption in respect of the relevant financial year
  • Completed Companies House form AA06. The statement of guarantee by a parent undertaking of a subsidiary company under section 479C of the Companies Act 2006 in respect of the relevant accounting year
  • A copy of your parent undertaking’s consolidated accounts including a copy of the auditor’s report and the annual report on those accounts

Your subsidiary must be included in your parent’s consolidated accounts for the relevant financial year or to an earlier date in the same financial year. Your parent undertaking must disclose in the notes to their consolidated accounts that your subsidiary is exempt from the requirements of this Act relating to the audit of accounts under section 479A of the Companies Act 2006

The agreement and your parent’s consolidated accounts must show your subsidiary company’s name and registered number in a prominent place on the document.

The audit exemption will only be available if your company’s financial year ends on or after 1 October 2012

Company cannot claim exemption from audit as a subsidiary

Your subsidiary is not entitled to audit exemption if it was at any time within the relevant financial year, it is a:

  • Quoted company.
  • Company that is an authorised insurance company , a banking company, an e-Money issuer, a MiFID investment firm or a UCITS management company.
  • Company that carries on insurance market activity.
  • Special register body as defined in section 117(1) of the Trade Union and Labour Relations (Consolidation) Act 1992 (c 52) or an employers’ association as defined in section 122 of that Act or Article 4 of the Industrial Relations (Northern Ireland Order 1992 (S.I. 1992/807 (NI 5).

The Companies House form AA06

Your statement of Guarantee by a parent undertaking of a subsidiary form AA06 must include the following information:

  • Registered name and number of your subsidiary.
  • Your subsidiary’s financial year to which the guarantee relates.
  • The statement date
  • Details of the section of the Companies Act 2006 under which the guarantee is being given:
    • section 394c – exemption from preparing accounts for a dormant subsidiary
    • section 448c – exemption from filing accounts for a dormant subsidiary
    • section 479C – audit exemption for a subsidiary undertaking
  • Either:
    • if the parent was incorporated in the UK its registered name and registered number (if any)
    • if the parent was incorporated and registered (in the same country) elsewhere in the EEA, its registered name, registration number and the identity of the register where it is registered.

Effect of the guarantee and when it takes effect

The guarantee has the effect that your parent undertaking guarantees all outstanding liabilities that your subsidiary is subject to at the end of the financial year. The guarantee takes effect when it is delivered to Companies House and remains in force until all of the liabilities have been satisfied.

Audit exemption compliance

Your Subsidiary company must include an audit exemption statement on your balance sheet in your individual company accounts to the effect that:

  • For the year ending (dd/mm/yyyy) the company was entitled to exemption from audit under section 479A of the Companies Act 2006 relating to subsidiary companies.
  • The members have not required the company to obtain an audit of its accounts for the year in question in accordance with section 476
  • The directors acknowledge their responsibilities for complying with the requirements of the Act with respect to accounting records and the preparation of accounts.

Medium sized company accounts

Your medium sized company can prepare accounts according to special provisions applicable to medium sized companies. It can also choose to submit reduced information to Companies House.

Medium-sized company criteria

Your limited company must meet at least two of the following conditions in order to be eligible to prepare and submit medium sized company accounts.

Threshold
Annual salesNot more than £36 million
Balance sheet totalNot more than £18 million
Average number of employeesNot more than 250

Company cannot prepare and submit medium-sized company accounts

Your company cannot be treated as a medium sized company if it is, or was at any time during the financial year, one of the following:

  • A public limited company
  • A company that has permission under Part 4 of the Financial Services and Markets Act 2000 to carry on a regulated activity or that carries on an insurance market activity
  • A member of an ineligible group

A group is ineligible if any of its members is:

  • A public limited company
  • A body corporate (other than a company) whose shares are admitted to trading on a regulated market.
  • A person (other than a small company) who has permission under Part 4 of the Financial Services and Markets Act 2000 to carry on a regulated activity.
  • A small company that is an authorised insurance company, a banking company, an e-money issuer, a MiFID (ie Markets in Financial Instruments Directive) investment firm or a UCITS (i.e.Undertakings for Collective Investment in Transferable Securities) management company.
  • A person who carries on insurance market activity

Qualifying as a medium-sized company every year

Your company qualify as medium sized company in your first accounting period if you fulfil the conditions in that period. In any subsequent period your company must fulfil the conditions in that period and the period before.

However if your company which qualified as medium sized in one period no longer meets the criteria in the next period, you may continue to claim the exemptions available for the following period. If your company then reverts back to being medium sized by meeting the criteria the exemption will continue uninterrupted.

Contents of medium-sized company accounts

Your Medium sized company accounts must include:

  • Profit and loss account
  • Balance sheet, showing the printed name and signature of a director
  • Disclosure notes to the accounts
  • Group accounts (if appropriate)
  • Directors’ report including a business review (or strategic report) showing the printed name of the approving secretary or director
  • Auditor’s report that includes the name of the registered auditor unless the company is exempt from audit

Your medium-sized company must deliver all of the constituent parts of your company accounts to Companies House.

Medium sized company exemptions

Your medium-sized company may omit certain information from your business review or strategic report in your directors’ report. This includes analysis using key performance indicators so far as they relate to non-financial information.

Medium sized company which is part of an ineligible group can still take advantage of the exemption from disclosing non-financial key performance indicators in your business review or strategic report.

Medium-sized company preparing accounts according to Companies Act may omit disclosure with respect to compliance with accounting standards and related party transactions from your company accounts send to their members.

Your company may also choose to deliver a slightly reduced information of the profit and loss account. Please refer to regulation 4 of The Large and Medium sized Companies and Groups Accounts and Reports Regulations 2008 for further information.

Some subsidiary company may be exempt from audit where they meet certain conditions for financial years ending on or after 1 October 2012.

Medium sized groups

There are no special rules for medium sized groups. Your medium sized parent company must prepare group accounts and deliver them to Companies House.

Submit company accounts on paper

Limited company may submit company accounts on paper to Companies House. Your company accounts must arrive Companies House offices on time, preferably well before your company’s filing deadline as your company will not be given any extra time if your accounts are rejected.

Company name and number

Your company name and number must appear on your company accounts documents such as your directors’ report or balance sheet. The name and number may also be shown on any cover sheet delivered with your accounts.

Signatory on company accounts documents

Your company accounts must meet the following requirements:

  • Director must sign on behalf of your board of directors and have his/her name printed on your balance sheet page.
  • Your directors’ report must include the printed name of your director or company secretary who signed the report.
  • if your company accounts include your auditor’s report, your auditor’s report must state your auditor’s name.

Please note that a legible signature on a balance sheet will not satisfy the additional requirement for a printed name. Companies House will reject any accounts that do not meet the above requirements.

Senior statutory auditor

Where your auditor is a firm, your auditor’s report must state the name of the auditor and the name of the person who signed it as the senior statutory auditor on behalf of the firm.

Small company accounts

Limited company may prepare and submit small company accounts with Companies House if your company meet the criteria of a small company according to special provisions in the Companies Act 2006 and the relevant regulations. This means that you can choose to disclose less information in your company accounts compared to that of the medium-sized and large companies.

Criteria to qualify as a small company

Your limited company must meet at least two of the following conditions:

After 01 Jan 2016Before 01 Jan 2016
TurnoverMust not exceed £10.2 millionMust not exceed £6.5 million
Balance sheet totalMust not be more than £5.1 millionMust not be more than £3.26 million
Average employeesNot more than 50Not more than 50

Limited company cannot prepare and submit small company accounts

Your company cannot prepare and submit small company accounts if it is, or was at any time during your financial year, one of the following;

  • A public limited company
  • A member of an ineligible group (see below)
  • An authorised insurance company, a banking company, an e-money issuer, a MiFID (i.e. Markets in Financial Instruments Directive) investment firm or a UCITS (ie Undertakings for Collective Investment in Transferable Securities) management company or carried on insurance market activity

A group is ineligible if any of its members is:

  • A public limited company
  • A body corporate (other than a company) whose shares are admitted to trading on a regulated market in an EEA State
  • A person (other than a small company) who has permission under Part IV of the Financial Services and Markets Act 2000 to carry on a regulated activity
  • A small company that is an authorised insurance company, a banking company, an e-money issuer, a MiFID investment firm or a UCITS management company
  • A person who carries on insurance market activity

Financial services companies are regulated by the Financial Conduct Authority.

Qualify to deliver small company accounts every year

Generally, your company qualify to deliver small company account in your first accounting period if you fulfil the conditions in that period. In any subsequent periods your company must fulfil the conditions in that period and the period before.

If your company which qualified as small in one period no longer meets the criteria in the next period, you may continue to claim the exemptions available for the next period. If your company then reverts back to being small by meeting the criteria for the following period, the exemption will continue uninterrupted.

Conditions to qualify as a small group of companies

Your company must meet at least two of the following criteria:

After 01 Jan 2016Before 01 Jan 2016
Aggregate turnoverNot more than £10.2 millionNot more than £6.5 million
Aggregate balance sheet totalNot more than £5.1 millionNot more than £3.26 million
Aggregate average number of employeesNot more than 50Not more than 50

Contents of small company accounts

Your small company accounts must include:

  • A profit and loss account
  • A balance sheet, signed by a director on behalf of the board and the printed name of that director
  • Disclosure notes to the accounts
  • Group accounts (if a small parent company chooses to prepare them)
  • A directors’ report that shows the signature of a secretary or director and their printed name
  • An auditors report that includes the printed name of the registered auditor unless your company qualifies for audit exemption.

The balance sheet must contain a statement in a prominent position above your director’s signature and printed name that your company accounts have been prepared in accordance with the special provisions applicable to companies subject to the small companies’ regime.

Your company do not have to deliver a copy of the directors’ report or the profit and loss account to Companies House. However, if you opt not to deliver a copy of the profit and loss account your company must state this fact on the balance sheet. you only deliver a signed balance sheet with disclosure notes to Companies House.

The requirements for companies subject to the small companies’ regime are set out in Parts 15 and 16 of the Companies Act 2006.

Small company abridged accounts

The Companies, Partnerships and Groups (Accounts and Reports) Regulations 2015 introduced the concept of abridged accounts.

Abridged accounts contain a balance sheet that contains a sub-set of the information that is included in a full balance sheet. Likewise, the profit and loss account may also contain a sub-set of the information that is included in a full profit and loss account.

Companies must now prepare and file the same set of accounts for its members as for the public record. This means that your company will decide at the point you are preparing your accounts whether or not to abridge them (or to prepare micro entity accounts). Previously your company would prepare full accounts for your members and would then decide whether or not to abbreviate them for the public record.

If you opt to file an abridged balance sheet and/or profit & loss account then you must include a statement on the balance sheet that the members have agreed to the preparation of abridged accounts for this accounting period in accordance with section 444(2A).

Small companies preparing International Accounting Standards accounts must deliver a full balance sheet to Companies House.

Small company abbreviated accounts

The Companies, Partnerships and Groups (Accounts and Reports) Regulations 2015 abolished abbreviated accounts. This means that abbreviated accounts cannot be prepared and filed with Companies House after 1 January 2016.

Other small company exemptions

The Companies Act 2006 and regulations also set out what the directors’ report of a small company must contain. Your director report does not have to contain a business review (or strategic report) or a statement as to the amount that your directors recommend be paid by way of dividend. If your company has taken advantage of the small companies’ exemption in preparing your directors’ report it must contain a statement above your director’s or secretary’s signature and printed name to that effect.

Your small company may also claim exemption from audit. In this circumstance, you may submit unaudited company accounts.

Your small company which has chosen to not file your profit and loss account may also opt not to file a copy of your auditor’s report on your accounts. In this instance, you must make the following disclosures in the notes to your company accounts: your auditor’s name (if your auditor was a firm, the name of the senior statutory auditor), to state whether your auditor’s report was qualified or unqualified, and, if your audit report was qualified, what the qualification was.

Special rules for small groups

A parent company which qualifies as small need not prepare group accounts or submit them to Companies House if the group is small and not ineligible. If your small parent company decides to prepare group accounts your content is prescribed by the Companies Act 2006 and by Schedule 6 to the Small Companies and Groups (Accounts and Directors’) Report Regulations 2008.

If you prepare group accounts you must include a statement above the printed name and signature of your directors on the balance sheet, confirming that your accounts are prepared in accordance with the provisions applicable to companies subject to the small companies’ regime.

Unlimited company

Unlimited company need only deliver company accounts to Companies House if, at any time during the accounting period covered by your accounts:

Your unlimited company was a:

  • Subsidiary undertaking
  • Parent of a limited undertaking;
  • Banking company
  • Insurance company (or the parent company of a banking or insurance company);

or

  • Each of your company’s members was:
    • A limited company;
    • Another unlimited company each of whose members was a limited company;
  • A limited company
  • A Scottish partnership each of whose members was a limited company.

A limited company, public or private, a partnership, a subsidiary and a parent must submit their company accounts with Companies House.

A public limited company must submit audited company accounts and for a private limited company may opt to deliver unaudited company accounts if they meet the audit exemption criteria.

A dormant subsidiary may be able to claim exemption from the preparation or filing your company accounts under certain circumstances.

Contact Companies House or seek accountants advice for further information on your unlimited company’s accounts filing requirements.

Admission to Stock Exchange

Public limited company must satisfy the admission requirements before they are allowed to trade their shares publicly.

Your public limited company must provide information which satisfies the listing requirements governed by the rules laid down by the Financial Services Authority.

The Financial Services Authority is acting as the United Kingdom Listing Authority or UKLA.

There are two Stock Exchange market in the United Kingdom – the Senior Equity Market and the Alternative Investment Market (AIM).

Senior Equity Market

The Senior Equity Market in London also known as the Official List for large public limited companies.

Alternative Investment Market

There is a secondary stock market, open to smaller companies.

To be admitted to Stock Exchange, your public limited company must meet the following criteria:

3 years preceding company accounts

To be admitted to listing, your company must be registered as a public limited company and it must intend to place on the market shares which are expected to have a market value of £700,000 or more.

Your company will not be admitted if it has not published or filed accounts covering three years preceding to your application for listing in the Stock Exchange, and your company must have arranged for a report prepared by independent accountants covering the three preceding years to be produced.

Approved Sponsors

Your directors must consider that your company is financially viable. A further condition for admission is that your public limited company’s working capital is sufficient. This admission requirement is satisfied by your Approved Sponsor to the issue, usually a merchant bank or stockbroker with overall responsibility for arranging the issue, sending a letter to the United Kingdom Listing Authority stating that your directors have made careful enquiries to satisfy themselves and the Approved Sponsor that the working capital is indeed adequate.

The final principal admission requirement is that it must be intended that at least 25% of any class of shares will be in the hands of the public is required by The Listing Rules.

Prospectus

If your public limited company can satisfy the admission requirements, it must then also satisfy the listing particulars requirements.

This obligation involves your public limited company publishing listing particulars or a prospectus which complies with Chapter 5 and 6 of The Listing Rules.

The range of information which must be published by your public limited company includes:

  • Information on the shares which are to be listed,
  • Your share or loan capital,
  • Principal activities,
  • Place of business and employees,
  • Company’s finances (in the form of balance sheet and profit and loss accounts for the last three years) and management and on trends in the company’s business.

The prospectus needs to include a statement that your company accounts have been audited for the last three financial years. The people responsible for the prospectus need to make a declaration to the effect that to the best of their knowledge, the information given in that part of the prospectus for which they are responsible is in accordance with the facts and contains no admissions likely to affect the import of the prospect us.

There are additional disclosure rules for changes in your auditors in the previous three years, details of options, tax clearances, and the terms of the directors’ service contracts.

Information contained in the prospectus should not be misleading, false or deceptive, your public limited company will incur both civil and criminal liability under the Financial Services and Markets Act 2000 if evidence supporting materials errors on the prospectus is established.

Special rules for public limited company

It is very common for companies to upgrade trading status from a limited company to a public limited company. There are special rules a public limited company (PLC) must be aware of and there are as follows:

Payment for share capital

  1. The original subscribers to a public limited company’s memorandum are required to pay cash for their shares.
  2. At least 25% of the nominal value and the whole of any premium on shares in a public limited company must be paid on allotment.
  3. A public limited company cannot accept an undertaking to do work or perform services as consideration for the allotment of shares.
  4. A public limited company can accept the transfer of assets to the company as full or part (subject to the 25% limit) payment for the allotment of shares but any undertaking to transfer those assets to the company must be performed within five years of the allotment. In addition, the company must take steps to satisfy itself that the value of the assets transferred to the company is accurate by obtaining an expert’s valuation and report.

Pre-emption rights on the allotment of shares

A public limited company must include the statutory pre-emption rights by a provision in its memorandum or articles. However, a public limited company (like a private company) can prevent the pre-emption rights applying by giving the directors the authority to allot shares in accordance with the Companies Act 2006.

Maintenance of capital

The directors of a public limited company are obliged to convene an extraordinary general meeting if the company ‘s net assets are 50% or less of its called up share capital. The meeting must be convened within 28 days of one of the directors becoming aware of this fact and it must be held within 56 days. Obviously, the purpose of the meeting is for the problem to be considered but the Companies Act does not require the directors to take any definite steps to remedy the position.

Purchase own shares

Public limited company, like private limited company, can buy back their own shares and issue redeemable shares. However, public limited company cannot (unlike private companies) use capital to purchase or redeem shares; a public company can only use its profits for these purposes, in addition, the tax rules which, if the various conditions are complied with, allow the shareholder whose shares have been bought by the company to treat the purchase as a disposal for capital gains tax purposes, rather than the receipt of a distribution attracting income tax liability, only apply to the shares in unquoted companies. It should, however, be remembered that a public limited company will not necessarily have a listing on the Stock Exchange.

Financial assistance for the acquisition of shares and loans to directors

The rules prohibiting companies from providing financial assistance for the purchase of their own shares are more stringent in the case of public limited company than in the case of private limited company. Similarly, the rules dealing with loans to directors are more stringent in the case of loans to directors of public limited company as laid down by the Companies Act.

Distribution of profits

In addition to the general rules restricting the funds from which companies can make distributions, public limited company is only permitted to make a distribution if their net assets are not, as a result of the distribution, reduced below the combined total of their called up share capital and ‘undistributed reserves.

Accounting requirements

The provisions which permit ‘small’ and ‘medium sized’ companies to file less detailed accounts with the Registrar of Companies do not apply to public limited company. They also cannot qualify as dormant company (which would lead them to be able to dispense with auditors). A public limited company must deliver audited company accounts to Companies House.

Age of directors

A public limited company may not appoint a person aged 70 and above to be a director unless the appointment is approved by the company in general meeting, following special notice (giving the age of the director) of such resolution. When a director of a public limited company reaches the age of 70, he must retire unless the company in general meeting votes to retain him. Again, special notice must be given of any such resolution.

Written resolutions

The Companies Act which read the members of private limited company can take decisions by written resolutions rather than passing resolutions at general meetings, does not apply to public limited company.

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