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26 March 2020

Three month extension period to file accounts during COVID-19

In an attempt to help companies avoid incurring penalties whilst they deal with the impact of COVID-19, Companies House published a press release on 25 March 2020 announcing that companies would have an additional three months to file accounts.

Background

All companies which are on the Companies House register must file accounts and reports each year by the applicable deadline. The period allowed for a private company to file its accounts and reports is nine months after the end of the relevant accounting reference period. This period is modified if the relevant accounting reference period is the company’s first accounting reference period and is more than 12 months in duration. In those circumstances, the period is nine months from the first anniversary of the incorporation of the company or three months after the end of the accounting reference period whichever last expires.

If accounts are not filed by the relevant deadline, companies in default are issued with an automatic penalty. The penalty imposed on private limited companies depends on the length of the delay as detailed below but this is doubled if the accounts are late two years in a row:

Time after the deadlinePenalty (for private limited companies)
Up to one month£150
One to three months£375
Three to six months£750
More than six months£1,500

In addition to a financial penalty, a company can be struck off the register if the company’s accounts or confirmation statement is not filed with Companies House.

Penalties for late filing for public limited companies are different from the ones for private limited companies.

Three month extension

The three month extension announced by Companies House on 25 March 2020 does not apply automatically. Companies who wish to opt for this extension must submit an online application through a fast-tracked online system which will take approximately 15 minutes to complete.

If the application is based on issues experienced by the company due to COVID-19, the company will be automatically and immediately granted a three month extension. If the company has already extended its filings deadline or shortened its accounting reference period, it may not be eligible for an extension.

The fast-tracked online system can be accessed here.

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