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What are the penalties for late filing of company accounts?

Businesses should pay the fees within the deadline to prevent late filing penalties. If you do not file the accounts with Companies House, you may need to pay the deadline. Businesses will receive notification about filing for penalties within the deadline.

If an account fails to pay the fee within two years, the penalties will be doubled. While the penalty for private companies will vary, the ones for the public limited companies will differ.

What are the penalties for late filing of company accounts?

What is a late filing penalty?

According to the rules, the new joiners must make it a point to file their first set of accounts within 21 months. After that, the accounts will be delivered within nine months, depending on the company's financial needs.

The Companies House must receive the documents. The word delivered means receiving the document and not handing it in. The documents must comply with the Companies Act. They are considered delivered only when they abide by the rules. However, if the account is rejected, it won't be regarded as delivered. It is crucial to file the delivery of accounts before the due date. If you fail to do so, the system will automatically file for a late penalty.

How much is the penalty?

The delay in receiving the account will determine how much amount you need to pay as a penalty.

TThe penalties for private companies or LLPs are as follows:

  • Less than one month late- £150.
  • One to three months- £375.
  • Three to six months- £750.
  • More than six months- £1500.

The penalties for public companies are as follows:

  • Less than one month late- £750.
  • One to three months- £1500.
  • Three to six months- £3000.
  • More than six months- £7500.

When will the late filing penalty be applied?

If you file any accounts late, you will receive a penalty notice from them. The penalty notice will consist of different details, which include:

  • Last date for filing.
  • Penalty.
  • Level of the penalty imposed.
  • Date of filing the accounts.

If any penalty has been imposed, you can pay it off by BACS. Nonetheless, you will need to enter your company number and bank transfer details. Furthermore, you must drop an email for the remittance to lfpfinance@companieshouse.gov.uk, declaring the date on which the payment was sent.

Appeal against a late filing penalty

There are certain conditions under which you must file for the penalty. When you are filing for a penalty, you must enter all the relevant details and provide a proper reason why you did not file the accounts on time.

If you failed to file the penalty because of any circumstances, make sure to prove the same. You can reach out to professionals at the Company House if you need any help filing the claim because of any health condition. Nonetheless, you must provide proper information about the same.

While you can appeal for the reasons of filing a penalty, there are certain conditions under which it will be unsuccessful. Some of the common conditions under which the penalty will be rejected include the following:

  • The company is dormant.
  • You are unable to pay the charges.
  • The account was late in the post process.
  • The accountant failed to provide correct information.
  • They were the first accounts.

Can you challenge a rejected or unsuccessful penalty?

Yes. If the appeal has been rejected, you need to provide proper support to prove your case. The best thing to do is to reach out to the Late Filing Penalties Department at the Companies House Office, and they are professionals who can help you with the accounts.

You can also reach out to the independent adjudicator to review your case. It is crucial to follow a proper process when applying, and the failure to do so can often be challenging.

Steps to appeal a late filing penalty

You can appeal against a late filing penalty only under special situations. You may not have proper discretion in filing the penalty. However, if you have the necessary documents, you can always file the appeal online.

When you appeal a late filing penalty online, here are some of the prominent information you will need to enter:

Can one avoid a late filing penalty?

Yes. It is crucial to work in close association with the professionals to avoid the late filing penalty. To ensure that you file the accounts accurately in time, here are some of the most prominent things you must consider:

  • Make sure to review your documents before you mail them to Companies House.
  • Review the accounts and check for dues. Make sure to clear all the dues.
  • Mail the documents within the specified time to ensure the documents reach Companies House within time.
  • Often people tend to avoid bank holidays and Sundays. Well, this is one of the biggest mistakes. If the due date is by bank holiday or Sunday, you should file the documents within the date.
  • It is advisable to set up reminders so that you can file the documents within time.

Failing to file accounts on time is a serious offence

Not many people in the UK take this seriously but filing the accounts late is considered a severe offence. As per the Companies Act 2006, it is a serious offence under which you can be charged a fine of up to £5000. You may personally be liable for making the payment. If the directors aren't responsible for filing the company's account, you will need to take responsibility for it.

If the company fails to pay the taxes on time, the assets belonging to them will be termed to be the asset of the Crown. Furthermore, the director will be responsible for any unpaid debts.

Conclusion

The company officers and accountants need to file the papers properly to prevent liability risks. The company will be responsible for filing the obligations. The directors who fail to provide accurate information may also need to dissolve the company or pay the debts as the company's house has offered it. The professionals may consider reaching out to an efficient accountant who can help overcome challenges.

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