What you are your clients need to know this month and beyond

Welcome to the first of our regular monthly collection of news and announcements that impact accountants and their clients for 2025!

You’ll be busy on their behalf already ahead of the end of the financial year in March – which is why we created our accountants hub so you’ll have access to the most important and accurate insolvency information whenever you need it. 

But you can’t be everywhere and read everything all at once, so we collect the most interesting and important business and insolvency news stories every week along with regular new blogs on a range of relevant topics for you each and every week. 

We’re always keen to hear what you think so email us at ask@businessrescueexpert.co.uk because we really want to write what you really want to read!

Becoming an Authorised Corporate Service Provider – what accountants need to know

From Spring 2025, accountants acting on behalf of businesses will be invited to register as Authorised Corporate Service Providers. 

This form of compliance with the Economic Crime and Corporate Transparency Act will give Companies House enhanced powers to combat financial crime. 

Martin Swain, Director of Intelligence & Law Enforcement Engagement at Companies House, said: “Our priority is to increase corporate transparency and accountability, and accordingly, businesses will have to adapt to ensure they’re compliant with this evolving practice. 

“The accountancy sector will be specifically affected by these changes, which will be implemented in stages across the next few years. Once these changes have been fully integrated, sole traders and third party providers who wish to file on the Companies Register will be required to register as an Authorised Corporate Service Provider before submitting information or conducting identity verification checks for their clients.”

Every applicant must ensure that they’re supervised by an official UK Anti-Money Laundering (AML) supervisory body such as ICAEW or ACCA. 

Once the registration service becomes fully operational, businesses will be asked to provide a membership number as proof of their affiliation during registration. Non-incorporated businesses will also need to offer information for cross-referencing with AML data. 

Following the completion of an ASCP registration, ACSPs will receive a digital account and a unique identification number. This will enable them to conduct ID verification checks for their clients and submit their clients’ identity information to the Registrar. 

Upon receipt, the Registrar will issue a Companies House Personal Code to the identity verified individual. This code will be required to be submitted with information on incorporation or the appointment of individuals from Autumn 2025.

From February 2025, any third-party providers who wish to carry out ID checks on behalf of their clients for Companies House must register as an ACSP. From Spring 2026, third party providers will also have to register their business as an ACSP in order to file any information on behalf of other companies. 

The Registrar has the power to suspend an ACSPs account if they suspect any non-compliance or inaccurate information. They also have the power to cease the ACSP completely if they deem the holder unfit to carry out ACSP functions.

New Chief Executive of HMRC named

John-Paul Marks has been named as the new Chief Executive of HMRC and will join the organisation in the Spring. 

Currently serving as the permanent secretary for the Scottish Government since 2022, Marks also worked for 12 years at the Department of Work and Pensions (DWP) as director general of work and health services and was previously principal private secretary for both Yvette Cooper MP and Iain Duncan Smith MP. 

He called his new appointment a privilege and said: “I look forward to supporting the department’s vital work to collect the revenues that fund public services, and to working with the board, colleagues and partners in the years ahead to deliver service modernisation and reform.”

Chartered Accountants – What’s in a name?  A lot as it turns out

“The description of chartered accountants is not one that just any firm can adopt. There are strict rules around the use of the title”. 

This assessment by Dean Neaves, Senior Manager in the Quality Assurance Department at ICAEW highlights an increasingly common conundrum for accountancy bodies. 

What happens when firms are describing themselves as “chartered accountants” but fail to meet all the specific requirements?

ICAEW are rightly quite prescriptive when it comes to the use of the term “chartered accountant”. 

Chartered accountants engaged in public practice as sole practitioners can automatically use the term but the most common mistake people make is failing to take into account the ownership structure of a firm. 

Dean Neaves gives an example. “There might be a firm where a chartered accountant for all intents and purposes runs that firm but there are other shareholders and directors who don’t have an active role. 

“They might think “I run the firm; therefore we can describe ourselves as chartered accountants; but what they’ve omitted to consider is that there are other people in the background. This is where they could fall foul of the regulations and that’s probably where most firms get caught out.”

CASH isn’t king

A London accountancy charity is under investigation due to failing to submit accounting information over several years. 

The Charity Commission has opened a statutory inquiry into Community Accountancy Self Help (CASH) which provides financial advice and training to small charities and voluntary groups. 

The regulator said it had identified “a repeated pattern of failures in submitting accounting information” over a number of years with its last filed annual return and accounts submitted on January 31st 2021. CASH’s accounting information for the year ended 2021 is now overdue by more than 1,000 days. 

CASH was also investigated in 2018 and 2020 under the commission’s double defaulters inquiry, which investigates charities that have failed twice or more in a five year period to submit required accounting information. 

During its previous engagements with CASH, the commission “emphasised trustees’ statutory duties” noting that “the charity, given its purposes, should be setting a good example to the charities to which it offers services.”

It said: “The regulator encouraged the trustees to make the necessary provisions to ensure all future accounting information was filed on time. Despite this extensive engagement, the charity is again in default, having failed to file accounts for years ended March 2021, 2022 and 2023.”

Employment law and other changes coming this year that you & your clients should consider

There are several employment law changes coming onto the statute book in 2025 as well as some other professional updates that accountants need to be aware of for the coming year. 

  • Professional Behaviour Standards

ICAEW are making changes to the fundamental principle of professional behaviour in its Code of Ethics being implemented early in 2025. 

The wording will now read: “A reasonable and informed third party would expect that a professional accountant, in their professional life, treats others fairly, with respect and dignity and for example does not bully, harass, victimise or unfairly discriminate against others.”

A similar approach is being adopted by other regulators including the Solicitors Regulatory Authority (SRA) and Financial Conduct Authority (FCA).

ICAEW have indicated that activities inside and outside the physical workplace would be captured under the revised provision including representing an employer at a conference, posting on social media platforms as a chartered accountant or attending work-organised social functions. 

Inappropriate conduct arising in these settings may trigger the duty on all member and member firms to report potential misconduct to ICAEW under the Disciplinary Byelaws. 

  • Artificial intelligence (AI)

Several accountancy regulators will be developing both ethical standards and guidance around the appropriate use of AI this year. 

ICAEW is set to introduce the IESBA Code of Ethics provisions relating to technology into the ICAEW Code of Ethics. Similarly, the FRC has recognised the growing use of AI and other new technologies in technical actuarial work, recently publishing updated guidance for actuaries on the use of AI and machine learning when applying the principles-based Technical Actuarial Standard 100.  

  • Audit, Reporting and Governance Authority (ARGA)

Following the mention of the draft Audit Reform and Corporate Governance Bill in the King’s Speech last year, the transition from the FRC to Audit, Reporting and Governance Authority (ARGA) has finally begun. 

The briefing notes to the King’s Speech provided a broad indication of ARGA’s likely regulatory perimeter, including the expanded definition of public interest entities (PIEs) to bring the largest private companies within its remit, as well as vesting the new regulator with additional powers to investigate and sanction company directors (who are not necessarily qualified accountants) for breaches of financial reporting and audit standards.

The draft bill is expected to be laid before parliament later in the year with final transition from the FRC to ARGA unlikely to be until 2028.

  • Unfair dismissal and probation periods

The new Employment Rights Bill abolishes the two-year qualifying period new employees must complete before they can bring claims for unfair dismissal. 

The government now proposes introducing a new statutory probation period, referred to in the Bill as an “initial period of employment”. During this time normal requirements for a fair dismissal will be modified in cases relating to the performance and conduct of the employee (but not for redundancies), allowing employers to dismiss employees more easily if they do not think they are up to the role or if their conduct is not suitable for the workplace. 

Although still subject to consultation, it is anticipated that this period will last for around nine months. 

  • Fire and Re-hire

The Bill brings to an end the ability of employers to offer to dismiss and re-engage employees in order to bring about a variation to the contract of employment. 

It will be classed as automatically unfair if an employee is dismissed for refusing to accept a variation to their contract or to re-engage an employee under varied terms and conditions when the role is extensively the same.

  • Employment Tribunal claims

The government has confirmed that they intend to change the time limit in which employees must bring a claim to the Employment Tribunal from three months to six. 

This means that there will now be a universal time limit for all claims to an Employment Tribunal and with less pressure to start legal proceedings may give parties more time to resolve their dispute without the need of judicial intervention.

Price freeze announced by Financial Ombudsman Service

The Financial Ombudsman Service (FOS) has announced that it will freeze all case fees and levies for firms for the next financial year. 

It predicts that it would receive 240,000 cases within its dispute resolution service in 2025/26 while also aiming to reduce case costs. Despite the increased volume of cases, the service said it plans to maintain current costs and levies, with case fees remaining at £650 for respondent businesses as well as maintaining the compulsory and voluntary jurisdiction levies. 

This would represent a saving of £70 million to the accounting industry compared to their 2023/24 pricing level. 

The service plans to reduce its cost per case should see case fees drop to £1,044 compared to a forecast cost of £1,082 for 2024/25.

Abby Thomas, chief executive and chief ombudsman of the FOS, said: “The decisions made by our vital service have this year helped tens of thousands of consumers and businesses resolve disputes in sometimes very difficult and stressful circumstances. 

“Our dedicated teams of experts have enabled people to receive millions of pounds back in redress. I’m also pleased that, for the second consecutive year, we have been able to offer significant savings to industry. 

Businesses using tax havens falls 43%

New analysis has found that the number of UK businesses using tax havens has halved as HMRC has obtained more data on whether they’re genuine. 

294 businesses registered without “appropriate substance” were noted last year, down from 512 the previous year. 

HMRC now receives details from nearly a dozen destinations which allows tax officials to start investigations as a result of the exchange of data arrangements with 11 jurisdictions. 

They are Anguilla, The Bahamas, Bahrain, Barbados, Bermuda, the British Virgin Islands, Cayman Islands, Guernsey, the Isle of Man, Jersey and the Turks and Caicos Islands. 

As part of an OECD programme, tax authorities in these countries now send data to HMRC if they identify a British company operating in their jurisdiction that is failing to do enough “substantial activity” in that territory. 

HMRC’s crackdown is part of the OECD’s “No or Only Nominal Tax Jurisdiction” project aiming to stamp out the use of tax havens through increased data sharing, creating minimum standards of business and establishing a minimum corporate tax rate in these countries.