How to remove a PSC from a limited company or LLP

If you need to remove a PSC (person with significant control) from a limited company or limited liability partnership (LLP), you must follow a specific procedure and notify Companies House within 14 days.

We explain the process below and discuss everything you need to know about this topic, including the most common reasons for removing a PSC from a UK company or LLP, how long it takes, and whether you can still be a shareholder after being removed as a PSC.

5 steps to removing a person with significant control

Removing a person with significant control (PSC) from a private company or limited liability partnership (LLP) is a relatively easy process, but you must adhere to the rules set out in sections 790VA & 790ZA of the Companies Act 2006.

Aside from a few minor variations to the details you will need to provide to Companies House, the process is the same whether you are removing an individual PSC, a registrable legal entity (RLE), or another registrable person (ORP).

Officially, the term ‘person with significant control’ refers to an individual person (i.e. a human being) who has a certain degree of ownership or control in a UK limited company or LLP.

A ‘relevant legal entity’ is a corporate entity, like a limited company or LLP, that would qualify as a person with significant control of another company or LLP, if it were an individual person.

An ‘other registrable person’ is any of the following:

• a corporation sole
• a government or government department of a country or territory, or a part of a country or territory
• an international organisation whose members include two or more countries or territories (or their governments)
• a local authority or local government body in the UK or elsewhere

However, for ease of reading, we will predominately use the term ‘people with significant control’ or the abbreviation ‘PSC’ throughout this post.

Step 1

The first step is to notify Companies House of the removal of a PSC, RLE, or ORP from your limited company.

To do so, you must provide the following information on the form Give notice of ceasing to be a person with significant control (PSC07):

• Company registration number
• Full company name as it appears on the public register, including the name-ending ‘Limited’ or ‘LTD’
• Current details of the individual PSC as they appear on the public register – title, full forename, surname, and their month and year or birth; or
• Name of the RLE or ORP as it appears on the public register
• The date on which they ceased to be a PSC, RLE, or ORP
• The date on which the company made this update to its statutory PSC register
• Signature of a director, company secretary, or other authorised person acting on behalf of the company

To remove a PSC, RLE, or ORP from a limited liability partnership, you will need to complete and file form LL PSC07 instead.

Step 2

Before sending the form to Companies House, you must get confirmation from the individual PSC, RLE, or ORP that their particulars (i.e. their details) are correct.

Failure to do so could result in the form being rejected by Companies House and/or require resubmission of the form with the correct details.

Step 3

Send form PSC07 (or form LL PSC07) to Companies House within 14 days of the PSC’s removal from the company. You can submit the form in one of three ways:

• using 1st Formations’ Free Online Company Manager facility
• using filing software via Companies House online service
• by completing form PSC07 on paper and sending it by post to Companies House

Online filing through a company formation agent or Companies House is the easiest way to report changes that have been made to your company.

When filing online, you will need to provide your company’s authentication code to authorise the submission – this is a security measure and acts as an online signature.

However, if you cannot file online, you should send the form to the Companies House address in the part of the UK where your company is registered. This will ensure that it is processed as quickly as possible.

If your company is registered in England and Wales, or Wales only, send the form to:

Companies House, Crown Way, Cardiff, Wales, CF14 3UZ

DX 33050 Cardiff

If your company is registered in Scotland, send the form to:

Companies House, Fourth Floor, Edinburgh Quay 2, 139 Fountainbridge, Edinburgh, Scotland, EH3 9FF

DX ED235 Edinburgh 1

If your company is registered in Northern Ireland, send the form to:

Companies House, Second Floor, The Linenhall, 32-38 Linenhall Street, Belfast, Northern Ireland, BT2 8BG

DX 481 N.R. Belfast 1

Step 4

When a person ceases to be a PSC, you must update your company’s statutory PSC register as soon as possible.

To do so, you will need to find the person’s entry in the register and record the date on which they stopped being a person with significant control of the company or LLP.

If the person ceases to be a PSC as a result of selling some or all of their shares, you will also need to update your company’s register of members accordingly.

• A guide to the Register of People with Significant Control (PSC)

Typically, companies and LLPs store their statutory registers at their registered office address or single alternative inspection location (SAIL address). However, private companies can also elect to keep certain statutory registers on the public register at Companies House instead.

Wherever they are kept, it is the responsibility of the company director or designated LLP member to ensure that these registers are always accurate, up to date, and made available for public inspection.

Failure to do so is an offence under the Companies Act 2006, which may result in significant penalties from Companies House.

Step 5

When it is time to deliver your next confirmation statement to Companies House, you should check your company’s PSC details on the public register.

If any of the PSC information is incorrect or out of date, you must notify Companies House, either online or by post, on the appropriate form:

• PSC forms for limited companies
• PSC forms for limited liability partnerships

You can file these forms before or at the same time as the confirmation statement.

• The confirmation statement explained
• Our Confirmation Statement Service – never miss another filing deadline

The only details that you can update on the confirmation statement itself are:

• Standard industrial classification (SIC) codes – i.e. the company’s principal business activities
• Statement of capital
• Shareholder information
• Trading status of shares
• Exemption from keeping a register of people with significant control

When you are satisfied that all of the information on the register is correct, you can deliver your confirmation statement to Companies House online or by post.

How long does it take to remove a PSC?

The amount of time that it takes to formally remove a PSC from a company or LLP depends on how quickly you file the notice of removal at Companies House, and whether you do this online or by post.

If you file online, Companies House will record the PSC’s removal on the public register within approximately 24-48 hours, depending on how busy they are at the time. Midweek filing tends to have the quickest turnaround, whereas sending forms on a Friday afternoon, over the weekend, or on a Monday morning may take a little longer.

Processing times are more significant if you send forms by post. In most cases, it can take up to 10 working days for Companies House to process paper forms and record updates on the public register.

When does Companies House update PSC details on the public register?

Companies House updates the public register each and every time changes are made to a company’s registered details. This includes the appointment or removal of a person with significant control.

• What becomes public information when you form a company?

When you file form PSC07 (or form LL PSC07), Companies House will check the details,  update the information on the public register within approximately 24-48 hours of receipt, and notify you by email.

A PDF copy of the form will also be disclosed on your company’s entry on the public register. All of this information, including the form, can be viewed free of charge by the general public, on the ‘Filing History’ of your company profile.

Why would I need to remove a PSC?

There are various reasons why you may need to remove a PSC from a limited company or LLP, such as:

• a shareholder sells or transfers some or all of their shares to another person
• upon a redesignation of shares, which alters the PSC’s nature of control (e.g. their percentage of shareholdings or voting rights)
• following a reduction of capital
• upon the death of the PSC
• an LLP member retires from the partnership
• an LLP member becomes a salaried member and no longer retains their significant influence over the affairs of the business
• the sale of the company or LLP
• an RLE or ORP with significant control is wound up and ceases to exist

You do not have to provide Companies House with the reason for a PSC’s removal.

Can I continue being a shareholder without being a PSC?

Not all shareholders are people with significant control. To be a PSC, you need to meet one or more of the following conditions in relation to a company or LLP:

• own more than 25% of the issued shares
• hold more than 25% of the voting rights
• hold the right to appoint or remove the majority of directors
• have the right to exercise, or actually exercise, significant influence or control
• have the right to exercise, or actually exercise, significant influence or control over the activities of a trust or firm which is not a legal entity, but would itself satisfy any of the first four conditions if it were an individual

Therefore, in many cases, an individual or corporate body can continue being a shareholder in a company, even if they are no longer a PSC, RLE, or ORP.

• What is a company shareholder?
• What are my shareholder rights?

Here is a simple example:

• You set up a company with 10 ordinary shares
• You take 5 of these shares for yourself, which is 50% of the company’s shareholdings
• This means that you are a PSC, because you hold more than 25% of the company’s issue shares
• You decide to sell 3 of your shares to someone else, leaving you with 2 shares
• You now hold only 20% of the company’s shareholdings
• This means that you are no longer a PSC, because you hold less than 25% of the company’s issued shares

In some cases, however, you can still be a PSC even if you hold less than 25% of shares in a company. For example, you may own different types of shares (e.g. alphabet shares or management shares) that provide you with more than 25% of the overall voting rights in the company.

Can I continue being a director when I am no longer a PSC?

Company directors are rarely PSCs by virtue of their directorship alone. To be a person with significant control, a director will typically need to hold shares in the company or be granted some other form of additional influence or control beyond the normal powers of a director.

It is the members (shareholders) of a company who decide which powers to grant to their directors. These powers are set out in the company’s articles of association and shareholders’ agreement.

• Is a director a person with significant control?
• Directors, shareholders, PSCs, and company secretaries – an overview

Therefore, you can still be a director of a company even if you are no longer a PSC. For example, if you decide to sell some or all of your shares but still want to continue running the business as the director.

Will my details be removed from the public register when I stop being a PSC?

When an individual or corporate body ceases to be a person with significant control, their details will remain on the public register at Companies House for the lifetime of the company.

Even after a company is dissolved, all of its registered details – including those relating to PSCs – will remain visible on the register for 20 years after the date of dissolution.

It is for this reason that we always advise directors, company secretaries, shareholders, and PSCs to use a non-residential service address (aka ‘correspondence address’), rather than registering their home address for such purposes.

Wrapping up

So, there you have…we’ve explained how to remove a PSC from a UK limited company or limited liability partnership in 5 simple steps. You can do this free of charge via 1st Formations’ Online Company Manager, using Companies House online service, or by sending a paper form by post.

We also outlined some of the most common reasons why you may need to remove a person with significant control, how long the process typically takes, what happens to a PSC’s details on the public register following their removal, and whether you can still be a shareholder after being removed as a PSC.

If you have any questions about this post, or need help with any aspect of company filing and administration – including the appointment or removal of PSCs – please leave a comment below or contact our Company Formation Team for expert advice and assistance.