Voluntary ID verification to go live for Directors

Voluntary ID verification to go live for Directors

A new verification system which will affect an estimated six million directors in the UK is coming into place and Companies House is urging directors to start registering early while the system is voluntary.

Despite the large number of people predicted to have to use the system, Companies House have said the site is fully prepared for large amounts of traffic!

At a recent briefing, a Companies House spokesperson said ‘tighter controls due to the new ID verification process means ‘there will be a number of people that will not get through’, and once it becomes mandatory it will become an offence for a relevant person not to verify their ID. The reason for it not becoming mandatory immediately is to help those affected by it prepare for the changes.’

The ID verification system which has been introduced as part of the Economic Crime and Corporate Transparency Act 2023 is designed to crack down on abuse of the company register to stop individuals setting themselves up as directors of fake companies and disguising their true identity.

Companies House has also stated it will be publicly publishing ‘cases of misuse’ but gave no further details.

Companies House CEO said: ‘Identity verification will play a key role in improving the quality and reliability of our data and tackling misuse of the companies register.’

‘We expect identity verification to become mandatory from autumn 2025. To reduce the burden on business, the identity verification (IDV) requirement for existing directors will be integrated into the annual confirmation statement update process.’

This effectively means that Company directors will be able to verify their own identity online at Companies House and will require a valid form of ID to do so.

Accountancy and law firms will be required to register as an authorised corporate service provider (ACSP) to provide the service to clients.

The system which will use artificial intelligence (AI), as well as machine learning, to verify identity and will work with other government departments, including HMRC, the Insolvency Service, the police, and the Law Society of England and Wales Company Law Committee to ensure the ID verification process is working as intended.

A Companies House spokesperson said: ‘This landmark legislation gave Companies House new and enhanced powers to help disrupt economic crime and support economic growth.’

‘Identity verification will provide more assurance about who is setting up, running, owning and controlling companies in the UK.’

‘There will be the same level of assurance whether individuals are verifying their identity directly with Companies House or through an ACSP.’