Companies House ID Verification 2025: A Director's Guide to the New UK Rules

Companies House ID Verification 2025: A Director’s Guide to the New UK Rules

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Companies House ID Verification 2025: A Director's Guide to the New UK Rules

A major change is coming for all UK company directors in 2025. Companies House is introducing mandatory identity verification and we’ve created this essential guide to explain what the new director ID verification rules mean for you, ensuring you stay compliant and avoid significant penalties.

These new measures are part of the Economic Crime and Corporate Transparency Act (ECCTA), a significant piece of legislation designed to improve the quality of data on the UK Companies Register and prevent corporate structures from being used for fraudulent activities.

This guide will walk you through the key changes, deadlines, and the exact steps you need to take.

What Are the New Director ID Verification Rules?

The core of the new legislation is the requirement for all new and existing company directors and other key individuals to verify their identity with Companies House. The goal is to ensure that every registered company has a real, verified person behind it, making it much harder to appoint fictitious directors or hide beneficial ownership.

This is a one-time verification process per individual, regardless of how many directorships you hold.

Who Needs to Complete the Companies House Identity Verification?

The new identity verification requirements apply to a wide range of individuals. You will need to verify your identity if you are:

  • An existing or newly appointed company director.
  • A Person with Significant Control (PSC).
  • A member of a Limited Liability Partnership (LLP).
  • Any individual who files information or documentation with Companies House.

Key Deadlines:

When Do I Need to Be Verified By?

The rollout of these new ID check rules is happening in phases. It’s crucial to be aware of these dates:

  • From April 8, 2025 (Voluntary Verification) — You can (and should) get ahead of the deadline by verifying your identity now.
  • From Autumn 2025 (Mandatory for New Appointments) — ID verification will be compulsory for all new company incorporations and for any newly appointed directors or PSCs.
  • Autumn 2025 – Autumn 2026 (Transitional Period for Existing Directors) — If you are an existing director, you will have a 12-month window to verify your identity. This period will be linked to your company’s confirmation statement filing date.
  • From Spring 2026 (Mandatory for Filers) — Anyone who files documents with Companies House, such as accountants or administrative staff, must have a verified identity.

Step-by-Step:

How to Complete Your ID Verification

There are two official methods for completing your director identity verification:

1. Directly with Companies House (digital route): This is a free digital process using the GOV.UK One Login system. You will need a form of photo ID, such as a passport or UK driving licence. The system will ask you to take a photo of your document and then a “selfie” to biometrically match your identity.

2. An in-person option at a Post Office will be available for those unable to use the digital service.

Penalties for Non-Compliance:

What Happens If You Don’t Verify?

Companies House is taking these new rules very seriously. Failing to verify your identity within the deadline is not an option. The consequences of non-compliance are significant and include:

  • A Criminal Offence — It will be a criminal offence for the unverified individual.
  • Financial Penalties — You could face substantial fines.
  • Inability to Act — You will be unable to legally act as a director.
  • Filings Blocked — You will be barred from filing any documents for your company.
  • Director Disqualification — You could be disqualified from being a director.
  • Reputational Damage — The public register will flag your status as “unverified,” which could damage your company’s credibility.

Frequently Asked Questions (FAQ)

Q: Is Companies House identity verification free?
A: Yes, verifying your identity directly with Companies House using the GOV.UK One Login system is free.

Q: What documents do I need for the ID check?
A: You will typically need a form of photographic ID. A valid passport or a UK photocard driving licence are the most common documents used.

Q: What happens if I am a director of multiple companies?
A: You only need to verify your identity once. The verified status will then be linked to your name and apply across all your directorships.

Do I Need to Register for Self-Assessment?

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Do I Need to Register for Self-Assessment?

by Mohamed at Taxfile.

In today’s guide, we look at the rules around whether or not you need to register for Self-Assessment and submit a tax return to HMRC each year. Let’s take a look.

Reasons to Register for Self-Assessment

You generally need to register for a Self-Assessment tax return if your income isn’t taxed at the source, meaning the tax isn’t automatically deducted from your wages/salary. Here are some common scenarios where you would need to register for self-assessment:

  • You are self-employed — sole traders, freelancers, and consultants typically fall under this category.
  • You receive rental income — if you earn income from renting out a property, you need to register.
  • You have a high income — employees earning over £100,000 per year need to register as their tax calculations may become more complex. (From 2023-24 you are only required to register if your income is above £150,000).
  • You have other income sources — this includes income from abroad, dividends, and partnership profits.

If you are still unsure about registration, please contact HMRC or call Taxfile on 0208 761 8000.

Registering for UK Taxes is Important

Registering for UK taxes is important for a few reasons, as we’ll explain below.

Firstly, it helps you avoid penalties. If you don’t register for Self-Assessment when required, you could face penalties from HMRC. These can be significant, especially if you’ve been earning income for a while without registering.

Secondly, it helps to ensure accurate tax payments. By registering and filing a Self-Assessment tax return, you ensure you’re paying the correct amount of tax. Without it, you might underpay and owe interest, or overpay and have to wait for a refund.

Thirdly, it helps you stay legally compliant. In severe cases, failing to register and pay your taxes can lead to legal action, including prosecution.

Registering also helps you maintain good standing with the Government. Being registered with HMRC shows you’re taking your tax obligations seriously. This can also be important if you’re applying for credit, a mortgage, or a visa.

Do Directors Need to Do a Self-Assessment?

Not all directors need to do a Self-Assessment tax return, but some do. Here’s a breakdown:

Directors with only PAYE income

If your only income from the company is through PAYE (Pay as You Earn), where tax is deducted at source, you generally don’t need to do a Self-Assessment.

Directors with additional income

If you have any other taxable income besides your salary, like dividends, company benefits, or income from another job, you likely do need to do a Self-Assessment tax return in order to report it.

However, even if you aren’t required to register, HMRC might still ask you to file a Self-Assessment return.

Learn more about director self-assessment here.

Why is Payroll Important for a Director?

Payroll ensures compliance with tax regulations. Directors are considered employees for tax purposes, and PAYE is the system used to collect Income Tax and National Insurance Contributions (NICs) from their salary. Running payroll ensures these deductions are made and reported correctly to HMRC.

Payroll creates a clear and accurate record of your director’s salary payments. This is important for tax purposes, but also for things like calculating benefits and pension contributions that might be tied to salary.

Being on payroll allows directors to qualify for certain benefits they wouldn’t get if paid through dividends alone. These can include enrolling in a company pension scheme and accruing National Insurance credits that contribute to your state pension.

Payroll ensures transparency by helping to maintain a clear separation between personal finances and the company’s finances. This is important for legal and accounting reasons.

While there might be tax advantages to structuring some of your director’s income as dividends, payroll remains a vital part of ensuring you’re following regulations and have a clear record of your director’s overall compensation.

Learn more about how to pay yourself as a director here.

Contact Taxfile – Accountants & Tax Advisors

Tax and accountancy help for South Londoners

If you need any accountancy help for your limited company or small business, Taxfile is here to help:

020 8761 8000 Book Appointment Contact Us

Are you in the South East or London? Taxfile has offices in Tulse Hill, and Dulwich, in South London.

How do I pay myself as a Director?

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This is a question we often face from new company directors, how to pay yourself from the company.

As part of our £375+VAT package for a new limited company we offer the following;

  • company formation (including the option to have the company phrased as a special purpose vehicle for a property rental company)
  • we will register a single director with HMRC for self-assessment
  • we set up the payroll scheme
  • we arrange your chart of accounts on online software and set up the bank feed so transactions are automatically recorded

So the two ways to get paid are in the form of a monthly salary run from a payroll set up by the limited company and the second way is through dividend allocations based on the company’s annual post-tax profit.

A salary is treated as an expense to the business, therefore decreasing profits, reducing corporation tax, and in turn, minimising the amount of dividends available to then be attributed to each shareholder.

We suggest (correct as of the 23/24 tax year) a salary of £9,096 per annum (£758 p/m) as this is the minimum amount to qualify for a state pension (also known as the secondary threshold).  If there are 2 or more directors (on the secondary threshold or above) or any additional staff on the payroll above the secondary threshold for the company, the Employment Allowance offered by the government becomes available, giving the company £5,000 ‘pot’ towards the employer’s NI contributions.

If the company posts a profit, the value of the post-tax profit can be allocated as dividends to the shareholder(s) of the company.  If there is more than one shareholder, then the dividends are allocated dependent on the percentage of shares held by each shareholder.

Unfortunately, the tax efficiency of dividends is being reduced.  For the 22/23 tax year there is a £2,000 tax-free allowance, for 2023/24 there will only be a £1,000 tax-free allowance and for 2024/25 it has been stated that it will be halved again to £500.

The amount of tax you pay on dividends will be dependent on your income tax band which includes your tax-free allowance, and any earnings from the limited company and any other earnings outside.

This will need to be declared on a self-assessment tax return to HMRC, which covers the period of the UK tax year from 6th April to 5th April every year.

As part of our £375+VAT package we can enrol one shareholder/director onto the self-assessment scheme with HMRC to obtain a Unique Tax Reference (UTR) to allow them to comply with their personal tax obligations in the future.  Contact us on 020 8761 8000 for more information.

What does it mean to be a Director?

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Your obligations as a Director can be ‘taxing’.

Running a successful limited company typically involves administrative duties outlined by Companies House & HMRC. As the director you’ll also be responsible for ensuring the finances of the company are regulated and healthy.  At Taxfile we can help you focus on growing your business and take care of all your accounting needs.

In order to fulfil your obligations, after your limited company’s financial year comes to a close, it must prepare a set of final accounts and a company corporation tax return.

The company’s final accounts are prepared from the company’s financial records for the period that covers your company’s financial year and must include:

  • a balance sheet showing the value of everything the company owns, owes and is owed on the last day of the financial year
  • a profit and loss account showing the company’s sales against its running costs and highlighting the profit or loss it has made over the financial year
  • notes about the accounts
  • a director’s report (unless you’re a ‘micro-entity’)

The accounts must either meet ‘International Financial Reporting Standards’ or ‘New UK Generally Accepted Accounting Practice’.

At Taxfile we can provide support for small to medium businesses that require accountants to compile and file their full company accounts ready for the shareholders, people of significance to the company, Companies House and HMRC as part of your company corporation tax return.

We can assist you with the bookkeeping and bank reconciliation to ensure that your accounting records are complete and include:

  • all money received and spent by the company
  • details of assets owned by the company
  • debts the company owes or is owed
  • stock the company owns at the end of the financial year
  • all goods bought and sold

As the director you are solely responsible that your accounts and tax return meet the deadlines for filing with Companies House and HMRC. From the accounts you can also deduce how much Corporation Tax to pay. The dates you will need to remember:

  • File the first set of accounts with Companies House 12 months after the date you registered with Companies House
  • File annual accounts with Companies House 9 months after your company’s financial year ends
  • Pay Corporation Tax or tell HMRC that your limited company does not owe any 9 months and 1 day after your ‘accounting period’ for Corporation Tax ends
  • File a Company Tax Return 12 months after your accounting period for Corporation Tax ends
  • File a Confirmation Statement 12 months after: company incorporated, company accounts submitted, or last confirmation statement

As a Director do I need to file a Self-Assessment Income Tax Return?

See our blog HERE

If you are thinking about setting up a limited company we are offering a special price of £375+VAT for the following;

  • company formation (including the option to have the company phrased as a special purpose vehicle for a property rental company)
  • we will register a single director with HMRC for self-assessment
  • we set up the payroll scheme
  • we arrange your chart of accounts on online software and set up the bank feed so transactions are automatically recorded

For more information about any of our tax- and accountancy-related services, call us on 020 8761 8000.

Forming a Limited Company?

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Having been the accountants of choice for individuals and businesses in the South London area, we have recently noticed a surge of individuals moving away from the sole trader status and enquiring about forming a limited company.

The reasons for changing status have varied; someone mentioned they should be, their customers needing them to be, being worried about having a personal liability against the business, to hoping to be more tax efficient.

What do we mean by a limited company?

A limited company is an organisation that is set up to run your business. A business becomes ‘limited’ once the company name and its owner(s) have been registered with Companies House and when limited status is granted, it becomes a distinct entity from its owners.

A limited company structure creates a distinct border between the business owner and the business itself, and under the eye of law, the business becomes a separate legal entity in its own right, becoming responsible for its own actions and finances.  This in turn limits the liability of the owner from any risk the business may need to take.    So if you are a small business expanding & possibly needing employees & assets, then a limited company is a good idea.

At Taxfile we are helping a lot more clients make this transition from a sole trader to limited status.

We can help you set up a private limited company, guide your through the process of what happens and what you need to do.  We offer an all-encompassing service from the setting up to filing the corporation tax returns.

We are offering a special price of £375+VAT for the following;

  • company formation (including the option to have the company phrased as a special purpose vehicle for a property rental company- SPV)
  • we will register a single director with HMRC for self-assessment
  • we set up the payroll scheme
  • we arrange your chart of accounts on online software and set up the bank feed so transactions are automatically recorded

A limited company will:

  • need to keep company records
  • report any changes to Companies House & HMRC
  • need to file an annual company tax return along with the company’s accounts, giving an undistorted view of its finances.

As a director of a private limited company you will:

  • make decisions that benefit the company rather than yourself
  • abide by the rules and regulations outlined by the company articles of association, which are written rules about running the company agreed by the shareholders or guarantors, directors and the company secretary
  • notify any shareholders if you might benefit personally from a company transaction
  • always act with the intention of making the company successful.
  • In forming a limited company you are limiting your personal liability but in doing so you cannot abuse your power with the limited liability to take selfish and unnecessary risks.

At Taxfile we can advise you on setting up a private limited company and take care of all these tasks for your private limited company — and avoid any complications down the line.

Starting a limited company is a relatively straightforward administrative task that starts out with choosing an available company name from Companies House to filling and filing a series of forms. At Taxfile we can ensure that all your forms are compiled correctly, providing ongoing support.

To set up your private limited company you will need at least one director and one shareholder.  As the business owner(s) you would then take a salary/wage from the business.  We can advise you how to best set up your salary and dividends to pay less tax.

Once you have a limited company set up you will need to open a new bank account in the name of your new company.  Our advice to clients, is to try and keep all the business income and expenses restricted within this one bank account and to avoid any personal transactions overlapping into this account.

It is also important to remember to transfer all business-related expenses into the company’s name and move any payment plans over to the new bank account.

If you would like help and advice about forming a private limited company please call us on 020 8761 8000.

Have You Received an Annual Return/Confirmation Statement Reminder?

Have You Received an Annual Return/Confirmation Statement Reminder?

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Have You Received an Annual Return/Confirmation Statement Reminder?

Please do not ignore the yearly e-reminder/letter, from Companies House, to submit the Annual Return/Confirmation Statement for your Company.

Hi — I’m Eveline and I am the administrator/coordinator of the Limited Companies business team and this is one problem that we come across too often at Taxfile.

Confirmation Statement form CS01As a Director, you just need to confirm once a year that there were no changes to the company and, if there were any, you can update them via the annual Confirmation Statement. Taxfile will help and send you a reminder — and we can submit the statement for you if you wish. Either way, please do make sure you submit the confirmation statement to Companies House online and in time.

If ignored, Companies House will start Strike Off action some time after the statement becomes overdue. If you ignore their further communication, they will dissolve your company after two months of publishing in the First Gazette. This would result in your bank sending you notice that the business bank account has been frozen and your assets will stay with the Government.

Taxfile is able to restore your company and help retrieve the money, but this is quite a long and costly process that could so easily have been avoided. So, please don’t forget to submit the Annual Return/Confirmation Statement in due time each year, or arrange for Taxfile to do so for you. Call 020 8761 8000 or contact us here and we’ll be happy to help with anything to do with tax, accountancy, bookkeeping, VAT or anything else to do with limited companies.

This post was brought to you by Eveline at Taxfile.