Economic Crime and Corporate Transparency Act 2023
ArticleThe Economic Crime and Corporate Transparency Act 2023 makes a number of modifications to company law, with the aim of enhancing corporate transparency and reducing economic crime.
The Economic Crime and Corporate Transparency Act 2023 (ECCTA) introduces the most significant changes to Companies House since it started in 1844. Designed to tackle economic crime and improve corporate transparency, the legislation brings wide-reaching reforms that affect directors, company secretaries, people with significant control (PSCs), and registered entities themselves.
The ECCTA impacts everyone who interacts with Companies House, whether individuals or entities. This includes all directors, secretaries, and people with significant control of entities registered at Companies House. It also affects the entities themselves, including companies, limited partnerships, limited liability partnerships (LLPs), and overseas entities. Agents providing company secretarial services will also feel the impact. Below we outline the key changes the ECCTA introduces.
- Mandatory ID verification for directors and PSCs
- Digital filing and new reporting requirements
- New ‘failure to prevent fraud’ offence
- Changes to reporting thresholds and disclosures
- Additional Companies House reforms
- Key implementation dates
Mandatory ID verification for directors and PSCs
To increase transparency around the individuals who control UK companies and LLPs, the government is implementing ID verification. Verification became mandatory from 18 November 2025.
- Directors must complete ID verification before the mandatory implementation date or before taking up their role.
- People with significant control (PSCs) must complete ID verification within 14 days of the mandatory implementation date or within 14 days of taking up the role.
Digital filing and new reporting requirements
Companies, LLPs, and limited partnerships may be required to file more detailed information at Companies House, and they must use digital filing methods; there is no effective date for these changes yet.
- Small and micro entities lose their reduced filing provisions and must file full accounts, including a Profit & Loss account.
- All financial statements must be filed digitally using appropriate software. Companies House will no longer accept paper filings or filings via its website.
New ‘failure to prevent fraud’ offence
The Act creates a new corporate offence to reduce fraud through UK companies.
- If a person associated with a large company commits a fraud offence intending to benefit the company, its subsidiaries, or any individual they serve, the company can be held guilty.
- This legislation takes effect from 1 September 2025.
Changes to reporting thresholds and disclosures
The Act introduces substantial changes to what companies, LLPs, and limited partnerships must include in their annual financial statements:
- The Companies Act 2006 size thresholds will change, so more companies will qualify as micro, small, or medium.
- The Department of Business and Trade will launch a consultation on non-financial reporting (including Strategic and Directors’ Reports) towards the end of 2025.
Additional Companies House reforms
Throughout 2024, Companies House implemented several smaller changes that now apply to all companies and LLPs. These include:
- Requiring appropriate registered postal and email addresses
- Confirming the lawful purpose of businesses
- Enhancing enforcement and sanction powers for Companies House
Key implementation dates
| Date | Change |
|---|---|
| October 2023 | ECCTA receives Royal Assent |
| March 2024 | Changes on postal and email addresses and Companies House powers take effect |
| April 2025 | ID verification processes go live, with optional verification for directors and PSCs |
| April 2025 | Size thresholds are increased, taking effect for periods beginning on or after 6 April 2025 |
| September 2025 | Failure to Prevent Fraud becomes an offence |
| November 2025 | ID verification becomes mandatory |
| Autumn 2026 | ID verification becomes mandatory for all others filing at Companies House (e.g., company secretaries) |
| To be confirmed | Mandatory digital filing; small & micro companies must file full financial statements |
| To be confirmed | Changes to contents of Strategic and Directors’ Reports, following consultation in 2026 |
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