Significant changes to identity verification (IDV) requirements at Companies House are on the horizon, introduced under the Economic Crime and Corporate Transparency Act 2023 (ECCTA).

These reforms are designed to boost corporate transparency, combat economic crime, and maintain the integrity of the public register by verifying the identities of those involved in establishing, managing, owning, or controlling UK companies.

These obligations will become mandatory from 18 November 2025, and we strongly advise directors, shareholders with more than 25% voting rights, and other affected parties to prepare now to avoid delays and potential penalties. Failure to comply could lead to filing restrictions, fines, director disqualification, or even company strike-off. We view these as some of the most substantial shifts in company law since the Companies Act 2006.

In Summary

If you serve as a director or hold more than 25% of a company’s voting rights, prioritize completing the Companies House IDV process immediately. This will help sidestep anticipated bottlenecks when verification becomes compulsory in November 2025. Non-compliance may result in operational disruptions, penalties, and severe consequences for both individuals and companies.

Who Is Affected?

The IDV requirements impact various individuals and entities linked to UK companies, applying to both new and existing roles. Here’s a detailed overview:

• Directors (and Equivalents): All directors of UK companies, including LLP members, general partners, and managing officers, must verify their identity. Corporate directors (e.g., companies or LLPs acting as directors) are currently exempt but will be included in future phases.
• Persons with Significant Control (PSCs): These are individuals or entities with substantial influence over the company, such as those who:
  • Hold more than 25% of shares or voting rights.
  • Can appoint or remove the majority of the board.
  • Exercise significant influence or control through other means.

All PSCs, new or existing, must verify. Corporate PSCs (also known as Relevant Legal Entities or RLEs) and their officers will face IDV requirements later.

• Shareholders: Standard shareholders without PSC status are not required to verify. However, those with over 25% shares or voting rights (or qualifying as PSCs) must comply. We recommend reviewing your share register to spot any who may need to act, especially if holdings change.
• Other Relevant Parties: Future expansions will cover individuals filing company documents (e.g., secretaries or authorised filers), limited partnerships, and corporate entities as directors or PSCs. Companies using third-party filing agents may need them to register as Authorised Corporate Service Providers (ACSPs). Overseas entities with UK establishments could see their directors affected.

Timelines and Transition Periods

Companies House has implemented a phased rollout to facilitate compliance:

• Voluntary Verification (Available Now): Since 8 April 2025, individuals can verify voluntarily. We urge early action to prevent delays.
• Mandatory for New Appointees (From 18 November 2025):
  • New directors must verify before appointment filings or company incorporations.
  • New PSCs have 14 days post-notification to Companies House.
• Transition for Existing Appointees (12-Month Window Starting 18 November 2025):
  • Existing directors must submit verification details (a unique personal code) in the next annual confirmation statement after this date.
  • Existing PSCs get a 14-day window starting from:
    • The company’s next confirmation statement (if also a director).
    • The first day of their birth month (as recorded) if not a director.

This provides up to 12 months for most to comply, based on filing cycles. Missing deadlines could block filings, incur civil penalties (up to £10,000 initially), or lead to criminal charges and director disqualification.

How to Verify Your Identity

IDV is typically a one-time process, yielding a unique “Companies House personal code” for ongoing use. Re-verification may be required in certain cases. Options include:

1. Direct Verification via GOV.UK One Login (Free):
   • Access the online service, which might involve an app, security questions, or a Post Office visit with photo ID (e.g., passport or driving licence).
   • Suitable for global users, though some methods require UK-based documents. For more, visit: GOV.UK One Login Identity Proofing.
2. Through an Authorised Corporate Service Provider (ACSP):
   • ACSPs like accountants, solicitors, or formation agents can manage verification. They must be AML-supervised and Companies House-registered (applications opened 18 March 2025).
   • This may involve fees but is ideal for convenience, especially internationally. As a trusted law firm, we can serve as your ACSP and handle the process efficiently.

Avoid sending originals to Companies House—everything is handled digitally or through approved methods.

Next Steps for Compliance

To stay ahead and reduce risks, consider these steps:

1. Review Your Records: Examine directors, PSCs, and shareholders using your share and PSC registers. Contact us if PSC status is unclear.
2. Plan Early Verification: Prompt affected parties to verify now via GOV.UK or an ACSP to beat the rush.
3. Update Confirmation Statements: Incorporate IDV into post-18 November 2025 filings. We can assist with preparation and submission.
4. Monitor Changes: For new directors or PSCs after the deadline, ensure prior verification.
5. Seek Expert Guidance: Non-compliance risks fines and disruptions. Our team at SJP Law offers:
   • ACSP services for seamless verification.
   • Corporate structure reviews for compliance.
   • Personalized ECCTA advice.

Contact your dedicated advisor at our firm, or reach us at 01482 324591 or info@sjplaw.co.uk to discuss support. We’re dedicated to guiding your business through these reforms smoothly.

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This debate is more than a celebrity soundbite. The Culture, Media and Sport Committee inquiry into large language models and generative AI, echoing many industry voices, has warned that failing to protect UK creatives risked damaging one of the country’s most valuable sectors, worth £124 billion a year.

For businesses working in publishing, design, marketing, fashion, tech or media, AI is already raising difficult questions around copyright, licensing and originality. And while formal reforms are still being shaped, the direction of travel is clear: companies will need to understand how their creative output might be used to train AI  and how they can respond.

While the government has dropped its earlier proposal for a broad copyright exception for AI learning, a move that had alarmed rights holders, it is now leaning towards a voluntary code of practice to govern how AI developers use copyrighted material in training datasets.

The proposed reforms include a new ‘text and data mining’ exception that would allow AI models to use copyrighted materials for training, unless the creator has explicitly opted out. While the government says the aim is to build trust, promote transparency and support innovation, concerns remain that creators could lose control over how their work is used.

This is particularly relevant for businesses creating digital content, images, branding or written materials, where AI tools may learn from publicly available data – including websites, product descriptions or marketing collateral – to generate new content.  

For businesses in the creative sector the implications are serious. While the government is suggesting opt-out mechanisms such as metadata instructions or ‘do-not-train’ lists, these could be difficult to manage in practice, particularly for smaller businesses.

Organisations also need to be aware of the risk of inadvertently using AI-generated content that may be based on copyrighted source material. Without clear licensing frameworks or transparency obligations on AI developers, this raises the risk of legal action down the line and potential reputational damage.

Explained by law expert Phillip Lewis-Ogden of SJP Law LTD, Hull-based solicitors: “Now’s the time for businesses to really take stock. Those creating original content should review how they protect and label their work and stay alert to developments around opt-out systems.

“And those using generative AI in their operations should take extra care to document sources, use only approved tools, and have clear policies in place to guard against infringement.”

Mr Lewis-Ogden added:  “In this rapidly evolving area, businesses should not assume that silence equals safety.  If you’re creating, licensing or using content that might intersect with AI systems, now is the time to get your house in order.”

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What is agricultural and business property relief?

Agricultural and business property relief applies to qualifying assets eligible for 100% agricultural property relief and 100% business property relief. This means these assets are excluded from Inheritance Tax calculations when their owner dies. This relief is available in addition to the existing nil-rate bands and exemptions. However, from 6^th April 2026, this relief will be capped.

What has changed?

From 6^th April 2026, agricultural property relief and business property relief will be capped at £1 million of qualified assets. The value of assets in excess of £1 million will be taxed at 50% of the current Inheritance Tax (IHT) rate. The UK government has also indicated that the £1 million cap is a combined value of agricultural and business property assets. If the IHT rate remains at 40% at that time, the IHT charge for the value of qualified assets in excess of £1 million will be 20%.

What to consider when carrying out succession planning

You must consider the options available to deal with agricultural and business property as part of the succession planning process. This starts with a discussion on the structure of the business and the valuation of the assets. Then you need to consider some options.

Lifetime gifting and taper relief (the 7-year rule)

Gifting ownership of assets during your lifetime is an effective way of reducing your exposure to Inheritance Tax. However, you should avoid gifts with reservations, where you continue to enjoy the benefits but no longer own the asset. If this is an income-generating asset, you should reduce your income accordingly. If you successfully do this and survive for at least seven years, the gifted asset will no longer form part of your estate for Inheritance Tax purposes.

Splitting ownership

If you own assets in your own name, consider transferring a share in the asset to your spouse. If you split the asset with your spouse, you immediately reduce the asset’s value as part of your estate by the amount you have shared. You might also consider splitting the assets with the next generation and their spouses. This further dilutes your estate, but care should be taken about potential future separation or divorce. You might want to combine any asset split with a post-nuptial agreement.

When you split ownership, in addition to each individual’s allowances, they each have £1 million of agricultural and business property relief.

Life Insurance

You might consider taking out life insurance that is paid outwith your estate and designed to cover all or part of the IHT your estate will face or any IHT payable as a result of a lifetime gift made within seven years of death.

Seek professional advice

Trying do-it-yourself fixes to something as complex as succession planning is not sensible. You should seek professional legal and financial advice and develop strategies that meet your needs. It is also essential to review plans regularly, especially when any changes can impact your decisions.

The post Succession planning for agricultural estates appeared first on SJP Law.

The new identity verification requirements, introduced under the Economic Crime and Corporate Transparency Act 2023, are being rolled out in stages and will soon become compulsory.  Companies are being advised to check their records are accurate and up to date ahead of the formal rollout, as mismatched information could prevent successful verification, leading to penalties and blocked filings.

Anyone who is a company director, person with significant control (PSC), or who files on behalf of a company will need to go through identity verification, either through the GOV.UK One Login or by using an Authorised Corporate Service Provider – a registered agent that must be supervised for anti-money laundering purposes, such as an accountant or solicitor.

“Companies should check that the personal details listed for each director and PSC are accurate,” said Philip Lewis Ogden, company & commercial solicitor at SJP Law. “If anything doesn’t match the ID document, you won’t be able to complete the verification process when it becomes mandatory.”

As well as providing the necessary ID documentation and answering knowledge-based security questions, personal details will be checked, including full name, any former names, residential address, including previous addresses if less than 12 months, date of birth, and a valid e-mail address not used by anyone else for verification.

The move is part of wider efforts to clamp down on fraud and improve transparency in the UK’s corporate landscape. In future, unverified individuals will not be allowed to make filings, and companies that fail to comply may face financial penalties or further enforcement action.

Philip added: “We don’t yet have a firm timeline for the new rules, but we expect compulsory identity checks will be in place by the autumn. When that happens, directors will have a limited window to comply. 

“For government, this is a proactive step towards tackling economic crime, but for legitimate businesses it’s just good housekeeping. Getting your records in order now and verifying your identity voluntarily will help you stay compliant and avoid disruption ready for when it becomes a legal obligation.”

Company records can be checked and updated via the find and update company information service on the Companies House website. Some changes can be made online, but others — such as correcting incorporation errors — must be made using paper forms.

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Why is it essential to have a Business Lasting Power of Attorney?

A business lasting power of attorney (LPA) is essential because it ensures business continuity and smooth continued operation should the owner be temporarily or permanently unable to manage the business. It allows decisions to be made, wages processed and paid, and contracts signed or enforced even though the business owner is incapacitated.

Who can benefit from a Business Lasting Power of Attorney?

Sole traders and single-director limited companies benefit most from a business lasting Power of Attorney. A partner in a partnership or a director in a limited company (with more than one director) may benefit. However, the terms of the partnership agreement or the articles of association may contain provisions for dealing with the incapacity of a partner or a director, rendering a business lasting power of attorney unnecessary.

How does a Business Lasting Power of Attorney differ from a Personal Lasting Power of Attorney?

A business lasting power of attorney focuses on the donor’s business. The donor is the person who grants the business Power of Attorney. Whilst a personal lasting power of attorney will deal with the donor’s personal affairs, the business lasting power of attorney focuses on the donor’s business needs. These include business continuity, finance management, contract negotiation, completion and enforcement and general business operations. The business lasting power of attorney can be tailored to meet the specific needs of the donor’s business.

Compliance with the Mental Incapacity Act 2005

A business lasting power of attorney must comply with the terms of the Mental Capacity Act 2005, which sets out the specifics regarding the donor’s capacity. Section 9 of the Act and subsequent sections deal with the requirements for the creation of lasting powers of attorney, the appointment of attorneys (“donees”), restrictions, scope, and revocation.

Communicate the existence of the Business Power of Attorney to Stakeholders

It is essential to inform others involved in the business’s management about the existence of the business lasting power of attorney. It may also be advantageous to inform the business’s bank and professional advisers. As a result of the grant of the business lasting power of attorney, management will be confident of the business’s continuity.

Some examples of the application of a Business Power of Attorney

Scenario 1: Unexpected Incapacity

• Situation:

You, the business owner, become incapacitated due to an accident or illness, rendering you unable to manage your business affairs. 

• BLPA Solution:

Your attorney can step in to handle essential tasks, such as signing cheques, paying invoices, managing bank accounts and making important business decisions, preventing disruption and financial losses. 

• Example:

The attorney can authorise the payment of salaries, service business loans, or sign contracts on your behalf. 

Scenario 2: Business Continuity

• Situation:

You are a shareholder or director in a company or a partner in a partnership, and you become incapacitated, should the partnership agreement or articles of association omit a procedure for dealing with incapacity. 

• BLPA Solution:

The BLPA allows your attorney to act on your behalf, ensuring the business can operate smoothly without delays or complications. 

• Example:

The attorney can manage business assets, handle tax affairs, or potentially hire or remove employees in coordination with and with the consent of other partners or co-directors. 

Scenario 3: Travel and Absence

• Situation:

You are a business owner who frequently travels and finds it challenging to manage certain aspects of the business while abroad. 

• BLPA Solution:

Your attorney can handle business matters while you are away, allowing you to focus on other aspects of your life without worrying about the business. 

• Example:

The attorney can manage business contracts, deal with clients, or attend meetings on your behalf. 

Scenario 4: Removing a Partner or Director

• Situation:

A partner or director in your company becomes incapacitated and cannot consent to being removed.

• BLPA Solution:

If the partnership agreement or articles of association omit provisions dealing with incapacity, a BLPA may allow your attorney to remove the incapacitated partner or director, preventing potential issues and ensuring the smooth running of the business.

• Example:

The attorney can take the necessary steps to remove the incapacitated partner or director, ensuring the business can operate effectively. 

Business Lasting Powers of Attorney – take legal advice!

If you are considering drawing up a business lasting power of attorney, it is critical that you seek legal advice. This will ensure compliance with the most up-to-date legislation and that the power of attorney contains provisions tailored to your business and operational needs.

The post Preparation of a business Lasting Power of Attorney – considering the advantages, need and practical examples appeared first on SJP Law.

Chancellor Rachel Reeves delivered a confident Spring Statement, aiming to instil certainty at home amid growing global uncertainty, highlighting opportunities for businesses — particularly in construction, defence, and tech — to benefit from the government’s growth plans.

Setting out strategies designed to boost defence and security, reform the state, and grow the economy, she reported that while growth estimates for 2025 have been halved to 1%, the Office for Budget Responsibility (OBR) has upgraded longer-term growth forecasts from 2026. Reeves highlighted that global economic policy uncertainty has increased sharply, making stability at home more important than ever.

As promised, there were no immediate tax changes, as these are to be the focus of a single, annual review each autumn, although the Chancellor announced further plans to clamp down on tax avoidance and evasion.  The Treasury aims to increase prosecutions for the most harmful cases of tax fraud by 20%, with the potential to recover an additional £1 billion in tax revenues each year by 2029-30.

The real takeaway, however, was business opportunities arising from structural interventions in the economy.

“For business, there’s real potential in the structural reforms and targeted investments set to stimulate growth, particularly in defence, construction, and technology.” said Philip Lewis-Ogden, Associate Director of SJP Law Limited.

“Businesses in these sectors should monitor upcoming procurement announcements and consider how they can align their capabilities with evolving national priorities, and also seek out ways to collaborate with others to create additional opportunities.”  

• Defence and national security

With ongoing geopolitical instability, the government reaffirmed its commitment to increasing defence spending, with an extra £2.2bn for 2025-26, creating opportunities for companies involved in defence supply chains, cybersecurity, and infrastructure projects. A minimum of 10% of the Ministry of Defence’s equipment budget will be allocated to emerging technologies, including drones and AI-enabled systems.

• Construction and infrastructure

Reeves confirmed the government’s push on housing and infrastructure, with changes to national planning policy expected to help build over 1.5 million homes during this Parliament. This focus points to increased demand for construction services and materials. Businesses across the construction supply chain — from project management to specialised trades — should prepare for growth opportunities as the government streamlines planning processes to unlock new developments.

Alongside, skills development for construction workers will receive £625m over four years, expected to deliver up to 60,000 additional skilled construction workers to support this growth.

• Tech and artificial intelligence
  
  

The government’s ambition to make the UK a global leader in artificial intelligence (AI) and emerging technologies was also reinforced. A £3.25bn Transformation Fund will deliver public service reforms, including AI tools to enhance efficiency in sectors such as the Ministry of Justice and foster care services. Tech companies developing AI applications or providing specialist expertise could see significant growth potential as government incentives stimulate further innovation.

“For businesses operating in these sectors, now is the time to assess how they can match up with government priorities,” added Philip Lewis-Ogden. “Whether securing government contracts, forming industry partnerships, or investing in innovation, aligning with these strategic areas could unlock future growth and resilience. 

“So, it’s important to be ready to pitch for these opportunities by identifying how tender-ready you are, and where updates and improvements can be made.  It’s not just about having the technical know-how or the product to suit, it’s about matching up on all aspects of the tender process.

“Smaller businesses may need to invest more time getting ready to pitch, particularly for government tenders,  but bigger business should also review where they stand.  Is your governance good enough, do you have sustainability targets in place, does your supply chain stand scrutiny?  And what is your financial standing – and that’s not just about a healthy cash flow, but your policies on paying suppliers or keeping to date on reporting.”

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This article considers the essential elements in a commercial lease and the approach you might take in the negotiation, depending on whether you are landlord or tenant.

The rent

The initial rent is clearly important. This will be the starting point on which future rent reviews will be carried out. That means it is important to ensure the initial rent is set at the right level. Of course, the landlord will want as much as possible by way of rent whilst the tenant is likely to argue for a lower sum.

To achieve a fair rent, there are a number of factors to take into consideration. The tenant should check the rental values of other similar properties in the locality and compare these to the property it is attempting to lease. Break it down into rent per square foot and compare that to similar properties in the same locality.

From a landlord’s perspective, irrespective of the rent being paid in the locality, there may be an argument that the property is unique or that rental property may be scarce in that particular location. This tends to lead to a higher rent being demanded by the landlord.

There is also the question of the strength of the covenant being created and this applies to both sides. Where the tenant is a “blue chip” tenant, such as a FTSE 100 company, it presents the landlord with the confidence that the rent will be paid and that the tenant will comply with all conditions contained in the lease. However, where the tenant is a start-up or does not have a solid trading history, the landlord might seek a premium by way of a higher rental or a rental deposit from the tenant to secure the lease and protect against potential early termination.

Rent reviews

Check when rent reviews will take place and what triggers these. Does the landlord need to give notice of its intention to increase the rent, or does it happen automatically?

The tenant also needs to think about the basis for the review. The rent review may be tied to an index like RPI or CPI or depend on the rent for comparable premises on the open market value.

Both parties need to ensure that the rent review mechanism is clear, workable and what happens when they are unable to agree to the increased rent.

Security deposit

In some instances, the landlord might insist on a security deposit if it believes the tenant does not provide a strong enough covenant or is concerned about the tenant’s financial standing. If the landlord suggests this, the tenant should insist that this be time limited and check on the condition set for the release of the security deposit.

Personal guarantees

In addition to or in place of a security deposit, the landlord might insist on a personal guarantee. This is most common when the tenant is a limited company, especially a newly formed limited company, or where the tenant’s trading accounts are not strong.

The common recommendation is that personal guarantees should be avoided as it means the landlord can come directly to the individual if the tenant defaults on any condition contained in the lease. This can lead to the landlord taking proceedings against the person who has given the guarantee.

The duration or term of the lease

The duration or term of the lease is another essential term in the negotiations. From a landlord’s perspective, the aim might be to look for as long a term as possible if the tenant is of good quality and will be interspersed with reviews at regular intervals. From a tenant’s perspective, the aim might be to look for a shorter lease incorporating break and extension options to allow them flexibility in the future should it find the location or facilities in the premises become unsuitable or if they outgrow the premises and need to move elsewhere to larger premises.

Break and Extension Clauses

Either party may seek to have break or extension clauses inserted into the lease. This may improve the flexibility of the lease. The parties will need to agree who can trigger the break or extension options and how much notice must be given to ensure the break or extension takes effect.

Break and extension options might also trigger a rent review or attract payment of a premium, usually by the tenant to the landlord.

Rent-free period

The tenant usually drives this to allow it to prepare the premises for trading. It is rare that any leased property will be absolutely ideal for the tenant to take entry and immediately commence trading. Invariably, works will be required to the premises which the tenant needs to carry out in advance of or as they are commencing trading. This means it is not unusual for a tenant to seek a rent-free period.

From a landlord’s perspective, it may be an attractive proposition to allow the tenant a rent-free period as the works or improvements proposed by the tenant might enhance the value of the premises.

As far as the length of the rent-free period is concerned, it will depend on market demand for the type of premises, the strength of the covenant and the condition of the premises prior to commencement of the lease.

Repair obligations

The lease should be clear on who is responsible for which elements of repair and maintenance. This is important because if the tenant is responsible for repair and maintenance of the premises, the landlord can visit to inspect and, if the premises are not up to the standard required in the lease, serve a dilapidations notice requiring the tenant to make good any damage.

If the obligations for repair and maintenance are placed on the tenant, it makes good sense to prepare a Schedule of Condition of the premises at the start of the lease to enable the tenant to exclude any damage existing at the commencement date from the repairing obligations in the lease.

Alterations clause

If the tenant wants alterations made to the premises prior to the commencement date of the lease, the landlord might be amenable to carrying these out either at the tenant’s cost or at its own cost, should it believe that the alterations will secure the lease and/or if the alterations improve the capital value of the premises or enhance its marketability in the future.

The tenant should review the provision in the lease relating to alterations it might wish to carry out during the term of the lease. Check the notice requirements and what information the landlord needs in order to grant consent.

It is particularly important to review any reinstatement conditions which might mean that the premises need to be restored to the pre-alterations condition on termination of the lease.

Subletting clause

If the tenant intends to sublet all or part of the premises, make sure the lease allows this. Check what the lease says about any notice you need to give to the landlord and what information the landlord might need.

From a landlord’s perspective, there is always the risk that the tenant might disappear leaving it with a sub-tenant occupying the premises. This can be problematic, especially as there is no direct relationship between the landlord and the sub-tenant. The landlord should insist on provisions that allow it to step into the tenant’s shoes in a sub-letting situation in the event that the tenant fails to pay the rent or otherwise fails to comply with the terms and conditions in the lease.

Termination of the lease

The termination date of the lease should be clearly stated. In addition, if the landlord has the ability to terminate the lease before that date, check the provisions that allow the landlord to do that.

Landlords and tenants should take legal advice

One of the key elements when negotiating a commercial lease is to take legal advice. This is an essential requirement. The lawyer will explain the technical conditions in the lease and their implications for the tenant.

The landlord should also seek legal advice to ensure the lease is created in a form that ensures any breach can be enforceable against the tenant and that any rent or other sums due under the lease can be quickly recovered.

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