Jennifer Scott and Sophie Bird, in our Charities & Education team, discuss how Charitable Companies can remain compliant under new legislation.
The Economic Crime and Corporate Transparency Act 2023 (the ECCTA) introduces a range of reforms for companies in England and Wales, aimed at tackling economic crime and increasing transparency at Companies House.
Charitable companies (often being companies limited by guarantee, but also being companies limited by shares) are subject to dual regulation by both Companies House and the Charity Commission, and are therefore directly affected by the ECCTA.
The latest phase of the ECCTA came into force on 18 November 2025, bringing into effect important new requirements concerning the way individuals are verified with Companies House.
Companies House now requires that all Directors and Persons with Significant Control (with a view for further expansion) complete an identification verification process. If identification verifications are not complied with on time, this may be a criminal offence.
For further information on the identification verification process, and on how Blandy & Blandy Solicitors can support companies in complying with these new requirements, read our blog here.
In light of these changes, some charitable companies may consider whether converting into a Charitable Incorporated Organisation (a CIO) is appropriate. A CIO offers the key advantages associated with a charitable company, notably separate legal personality and limited liability, with the additional advantage of being regulated solely by the Charity Commission, and therefore not being subject to dual reporting and compliance requirements that also apply to Companies House.
The CIO structure has been popular since its introduction in 2013, both amongst newly established charities and existing charities and charitable companies seeking to restructure, due largely to the above advantages, a trend that is likely to continue.
For further information or legal advice on corporate compliance, or charity restructure and incorporation, please email law@blandy.co.uk or call 0118 951 6800.
This article is intended for the use of clients and other interested parties. The information contained in it is believed to be correct at the date of publication, but it is necessarily of a brief and general nature and should not be relied upon as a substitute for specific professional advice.
