The Economic Crime and Corporate Transparency Act: IS your business ready?

The Economic Crime and Corporate Transparency Act (2023) is one of the most significant legislative changes to UK business regulation in recent years. Designed to tackle corporate fraud, money laundering, and the misuse of UK-registered companies, the Act strengthens transparency requirements and gives Companies House expanded powers to monitor and challenge suspicious activity.

Importantly, these reforms affect businesses of all sizes. Any company or partnership registered in the UK needs to understand what’s changing, what’s already in force, and what’s coming down the line. The confusing aspect of this legislation is that it has been implemented in phases over the past couple of years.

• October 2023

  Economic Crime and Corporate Transparency Act receives Royal Assent.

• Early 2024

  Initial measures roll out, including enhanced Companies House querying powers and improved data validation on the register.

• Mid 2024

  Implementation of additional powers to remove inaccurate or misleading information; Companies House publishes secondary legislation and detailed guidance.

• Late 2024

  Preparation for identity verification begins: Companies House launches new digital systems for verifying directors, PSCs, and agents.

• 2025

  Identity verification regime phased in; companies and stakeholders begin transition to new verification requirements and updated filing processes.

• Early 2026

  Companies House begins enforcing identity verification: unverified filings may be annotated or rejected.

• Mid to Late 2026

  Full enforcement powers activated; Companies House starts removing non-compliant entities from the register or restricting their activities.

• End of 2026

  Transition period completed; Companies House operates fully under the new legal framework, including monitoring, enforcement, and verification for all registered entities.

In this article, we’ll recap the key measures introduced so far under the Act and outline what businesses should do now to prepare for further changes due later this year and into 2026. Acting early will help organisations avoid disruption, maintain compliance, and protect their reputation in a tightening regulatory environment.

What’s Already in Place

Since the Economic Crime and Corporate Transparency Act received Royal Assent in October 2023, several key measures have already come into effect.

Companies House now has stronger powers to query, reject, or remove filings that appear suspicious or inaccurate — a major shift from its previous role as a passive record-keeper. This means businesses must ensure that all information they submit is complete, accurate, and compliant with the new expectations.

In addition, there has been a drive to improve corporate transparency, with increased scrutiny of company registers and beneficial ownership declarations. Companies must now be able to demonstrate who exercises significant control and ensure these details are properly disclosed and maintained.

Reforms to limited partnerships have also tightened requirements, ensuring that all such entities have a genuine UK connection and meet stricter reporting standards. These changes aim to reduce the misuse of corporate structures for activities such as money laundering, tax evasion, or fraudulent trading.

Taken together, these measures mean businesses should already be reviewing their governance, filings, and ownership records to align with the strengthened regulatory landscape. Those that haven’t yet made these adjustments risk falling behind as further reforms roll out.

What’s Coming Later in 2025–2026

While several key reforms under the Economic Crime and Corporate Transparency Act are already live, some of the most significant changes are still on the horizon — and they will fundamentally reshape how UK companies, partnerships, and corporate service providers operate.

✅ Mandatory Identity Verification
By 2026, all company directors, People with Significant Control (PSCs), and relevant agents must complete identity verification before they can legally act. This will apply to both new and existing appointments, meaning businesses will need to ensure that every relevant individual is properly verified.

✅ Enhanced Companies House Powers
As part of its expanded remit, Companies House will begin rejecting or annotating filings linked to failed or incomplete verification. This will help maintain the integrity of the register, but it also places a new compliance burden on businesses — failing to meet verification requirements could result in public warnings, administrative sanctions, or removal from the register.

✅ Full Transition by End of 2026
Companies House aims to complete its transition period by the end of 2026, at which point the full suite of powers, systems, and enforcement mechanisms will be live. From this point onward, companies will be operating in a landscape of heightened transparency, active monitoring, and stricter compliance expectations.

For businesses, preparing ahead of time is critical. By acting now, organisations can avoid last-minute scrambles, ensure governance processes are up to date, and safeguard against potential reputational or financial risks.

What Businesses Should Do Now

With the next phase of the Economic Crime and Corporate Transparency Act approaching, businesses should be taking steps now to ensure they are fully prepared. The first priority is to review governance arrangements and ensure that all directors and People with Significant Control (PSCs) are ready for the upcoming identity verification requirements. This might involve confirming that key individuals understand what is expected of them, gathering necessary documentation, and preparing to complete the verification process once the systems go live.

It’s also important to engage with any third-party agents or corporate service providers your business uses — such as company formation agents or secretarial services — to make sure they are aware of their own new obligations under the Act. These intermediaries will be subject to additional scrutiny and may need to update their processes to remain compliant.

Finally, businesses should take this opportunity to strengthen internal controls around company filings, ownership records, and reporting systems. Waiting until the final implementation deadline could leave organisations scrambling to meet requirements or facing avoidable compliance risks. By acting early, businesses can protect themselves not only from administrative or financial penalties but also from the reputational damage that can come from public non-compliance.

By taking steps now — reviewing governance structures, preparing for identity verification, and updating compliance processes — organisations can stay ahead of the curve and avoid unnecessary risks or disruptions. Acting early is not just a matter of ticking regulatory boxes; it’s an investment in your business’s integrity, reputation, and long-term resilience.

At Personnel Checks, we’re here to help you navigate these changes with confidence. Whether you need support with identity verification, governance reviews, or compliance planning, our expert team is ready to assist.

👉 Get in touch with us today to discuss how we can help your business prepare for the changes ahead.