Saffery Champness warns of impact of PSC extension on rural sector

Chartered Accountants Saffery Champness has urged the rural sector to take note of rules covering Register of People with Significant Control which are due to be extended from June.

The People with Significant Control (PSC) reporting requirement came into force from April 2016.

This required businesses to keep a register listing those people who have significant control over any company or LLP.

PSCs are individuals who meet one or more conditions contained in Government-issued guidance, among these: directly or indirectly holding more than 25 per cent of the shares, or 25 per cent of the voting rights; directly or indirectly having the right to appoint or remove a majority of directors; or simply having the right to exercise, or actually exercising, significant influence or control.

Now, as part of the fourth money laundering directive coming into effect in June 2017, there are to be changes to the PSC regime that broaden its scope, most notably that:

* From 24 July Scottish Limited Partnerships will be required to register PSC information at Companies House.

* From 24 July General Scottish Partnerships where there is a limited company as a partner will be required to do likewise.

* AIM listed companies will have to maintain a PSC register and file PSC information at Companies House

* From 26 June the annual confirmation statement that replaced the old annual return will not be used to update the PSC register. This will require to be updated instead by separate forms, with a 28 day time limit set for changes to be notified and registered.

Jamie Younger, a partner with Saffery Champness, and a member of the firm’s Landed Estates and Rural Business Group based at its Edinburgh office, said: “This is an unwelcome broadening of the PSC rules, and limited liability brings with it further erosion of privacy and more annual compliance. On the surface the whole concept may seem relatively simple, but it will require some thinking through - about how a business is run and who actually runs it, and Scottish limited partnerships (of which there are a large number in the farming sector) and Scottish general partnerships (with partners who have limited liability) must now file their PSC.

“Some people may not have been aware that there has for some time been a requirement for Scottish limited partnerships to register at Companies House. Furthermore, non-compliance is a criminal matter, and non-submission or late submission of information is likely to incur a penalty.”