Failure To File Accounts At Companies House On Time

Overview Of The Failure To File Accounts At Companies House

The failure to file accounts at Companies House is a breach of company law arising from Section 441 of the Companies House 2006 because a company Director MUST file accounts. 

The accounts are part of the typical annual requirement imposed on a company to file certain documents such as company accounts and a Confirmation Statement. 

Filing Company Accounts Late

A failure to file accounts can arise either if the company accounts are not filed at all but also if they are filed late.

Filing company accounts late can potentially act as a trigger for HMRC and or the Insolvency Service to open an investigation into a company’s affairs. This can avoidably lead to further consequences beyond the late filing penalties that Companies House will typically impose.

Late Filing Penalty Fees Due To Late Accounts

If accounts are subsequently filed but late then the following penalties are typically lodged:

Length of Period                                                   Ltd Company/LLP                                          Plc

Not more than 1 month                                               £150                                                         £750

1 month – 3 months                                                      £375                                                         £1,500

3 months – 6 months                                                   £750                                                          £3,000

More than 6 months                                                    £1,500                                                      £7,500

Failure To File Company Accounts Is A Criminal Offence

If there is a breach of a Director’s duty either to file company accounts on time or at all then a company Director has committed a CRIMINAL offence by virtue of Section 451 of the Companies Act 2006.

Plainly this is a serious matter that should not be ignored. It should be dealt with promptly.

A company also must file a Confirmation Statement on time as well or risk facing similar sanctions.

Companies House does indeed take action against Directors who file company accounts late or do not file them at all as is evidenced by the following information tables published showing the prosecution statistics here:
Companies House management information tables 2021 to 2022  

There is however a defence available if a Director can show he or she took all reasonable steps to comply. 

The Company Could Be Struck Off If Accounts Are Not Filed

If company accounts are not filed on time then the company could be struck off and dissolved.

If a company is struck off then in effect it ceases to exist and its assets are Bona Vacantia and lost to the Crown unless or until the company is restored to the register. As a result, this could lead to a costly exercise of not only having to pay late filing penalties to Companies House but also having to restore the company dissolved.

Breach Of Duty By Director Failing To File Accounts

Filing company accounts is one of the fundamental Director duties. It is mandatory, not optional.

The failure to file company accounts is a clear breach of the same and can be one of the matters considered in the event that an investigation was launched by the Insolvency Service for the purposes of Director Disqualification.

As a result company accounts should be submitted to Companies House for filing in good time to meet the statutory deadline.

There is always a risk that a company’s accounts when submitted to Companies House can be rejected for filing due to some error or omission as to the format or accounts requirements. In such circumstances, the company accounts will need to be corrected and resubmitted. Ideally therefore it is always worth sending in the company accounts for filing early to take account of this risk.

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