Avoid late filing fees by submitting accounts on time

All companies, large or small, must send their accounts to Companies House each year – and failure to do so can result in hefty fines and even a conviction for a criminal offence. Company directors are personally responsible for ensuring the accounts are delivered within the time permitted.

Penalty fees were introduced in the 1990s to discourage companies from filing their reports late. These can run into thousands of pounds depending on how late the accounts have been submitted.

A company’s first set of accounts, covering a period of more than 12 months, must be delivered within 21 months of the date of incorporation for private companies and within 18 months for public companies – or three months from the accounting reference date, whichever is longer.

For every subsequent set of accounts, a private company has nine months from the end of the accounting reference period to deliver their accounts to Companies House, while public companies have six months. Be aware that if you change the accounting reference period, the filing deadline may change.

The penalty fees are on a rising scale depending on the length of the delay in filing. This ranges from £150 for a private company filing up to one month late to £1,500 for a delay of six months or more. Public companies incur much higher penalties. Companies which file accounts late in two successive financial years are subject to doubled penalties – so filing up to a month late for a successive year will incur a £300 penalty for a private company.

Directors who fail to file accounts at all, or fail to pay fines for late submission, can find themselves subject to enforcement proceedings in the criminal courts, where they can be personally fined in addition to the penalties incurred by the company. There is no limit on the amount of these fines – and a conviction is likely to lead to disqualification proceedings against the Directors.

There will, of course, sometimes be a valid reason why accounts may not be filed before the deadline. Where reasons are exceptional, we would advise clients to discuss these reasons as it may be possible to make an application to Companies House to extend the deadline. Any application must be completed and with Companies House before the deadline.

Of course the safest way to avoid the pitfalls of late filing is to use the services of a trusted accountant who can take care of the filing obligations while you get on with running the business. To talk to HWB about our Company Secretarial & Accounting services, contact Gary Brown on 023 8046 1240.