As a result of the Government’s vow to increase corporate transparency, companies in the UK will be required to maintain a PSC register from the beginning of the new tax year. Not to be confused with the annoyingly identical acronym for ‘Personal Service Company’, in this case PSC stands for ‘Person of Significant Control’.
This new process may sound daunting, but it won’t add much to your workload at all. In fact, you’re likely to be doing most of this admin anyway. For your peace of mind, here is the PSC register in a nutshell.
What is the PSC register?
Each company will have to record information on who owns shares or directly influences its decisions. This information will be provided as follows:
- On an Annual Confirmation Statement (previously known as an Annual Return)
- Recorded on the company’s own PSC register
This data will be visible on the central public register at Companies House, so investors will have a better idea of what they’re getting themselves into when thinking about investing in a company. Money laundering investigations will also be aided by this register, which of course will need to be kept up to date at all times.
What happens if you don’t provide and record this?
Persons of Significant Control and their companies are obliged to provide these details. Those who do not take appropriate measures (or provide falsified details) face a fine or even imprisonment.
The new registers must begin on 6th April 2016 alongside any existing registers of directors or members (shareholders) and need to be in place by 30th June 2016. From the same date, newly formed companies will need to include information on Persons of Significant Control as part of their incorporation application.
Who classes as a PSC?
The Department for Business Innovation and Skills has advised that a PSC is an individual who:
- Holds more than 25% of shares or voting rights in the company.
- Holds the right to appoint or remove the majority of the board of directors of the company.
- Has the right to exercise significant influence or control over a company or other entity such as a trust.
The first two points are fairly straightforward, but the third is slightly subjective – if you feel this applies to your situation, we recommend you seek professional advice.
Where is the PSC register stored?
The register must be kept at the company’s registered office. If your registered business address is that of your accountant, and it is part of their service to keep company records, this is where the register will be held.
What information will you need to provide?
For each PSC, the following information will need to be disclosed:
- Date of birth
- Country, state or part of the UK where the PSC usually lives
- Service address
- Usual residential address (this must not be disclosed when making your register available for inspection or providing copies of the PSC register)
- Date he or she became a PSC in relation to the company (for existing companies, 6th April 2016 should be used)
- Which conditions for being a PSC are met
- Whether an application has been made for the individual’s information to be protected