What is a PSC Register (Person with Significant Control)?

Content:

DataGardener is a leading data analytics company providing in-depth analytics of the UK company directors and Companies House database. At DataGardener, we provide services to FinTech and Finance Providers, InsureTech and Business Insurers, Accountants, Bookkeepers, Mortgage Brokers, Startups, New Businesses, Marketing companies, Lead Generation Companies, Law Firms, Import and Export Companies, Corporate Investors, and Commercial Financial Brokers so that they find new clients and necessary information required for the growth of their business. All the information provided by us is extracted from the sources and records that are available publicly and is licensed with the Open Government License v2.0.

The following blog will help you in understanding everything about the Personal Service Company and Person with Significant Control Register (PSC) which is now mandatory for all the UK companies and LLPs under the law issued on 6 April 2016;

What is a personal service company (PSC)?

A Personal Service Company refers to a limited company, set up for the purpose of offering service to a single contractor who is the director of the company or the one who is a sole shareholder.

The “Personal Service Company”, also features in the context of rules to direct employment status by the government. It is also called IR35. These rules are made to ensure that the workers are rightly classified into self-employed or employed. Also, to ensure the correct amount of employment tax is paid.

However, PSC also means a Person of Significant Control in the business world. PSC is/are a person/people who has the special right to exercise his/her significant influence over the company.

What is PSC Register?

Societates Europaeae (SEs), limited liability partnerships (LLPs), and UK companies have to have a register of People/Person with Significant Control and are called the PSC register. This is carried out in addition to updating the register of members, directors and secretaries and so on. The PSC Register involves all corporate entities and people with significant control, must aid transparency for the UK registered businesses.

Previously, it was possible to register a UK business with shareholders and nominee directors in place by hiding the information about the real beneficial owners from the public record at Companies House.

Now in the current PSC register, all the UK registered businesses under the legislation must have a register with all the details of previously hidden beneficiaries and controllers.

The PSC register is needed to aid investors with analyzing company structures like DataGardener as well as helping law enforcement. This particularly helps in spotting money laundering and to identify and prevent illegal activities that might be carried out through UK business structures.

Frequently Asked Questions (FAQ):

1. Who is a PSC Companies House?

Personal service companies (PSCs) are introduced by HMRC when the IR35 legislation came in 2000. Although there is no legal definition of a PSC, it is commonly used to describe limited companies that are owned by a single person. And the Person with Significant Control in such companies is usually a person owning higher than 25% of rights for voting or the shares.

2. Does a limited company have to have a PSC?

Identifying the PSC has now become mandatory for all the limited companies and Limited Liability Leaderships (LLPs). All UK registered Limited Liability Partnerships (LLPs) and companies must create and maintain an updated register of People with Significant Control (PSC) along with the information of directors and members since 6 April 2016. Any individual who acquires significant control of the company is required to notify Companies House within the time limit given.

3. How do you find a personal service company?

A general definition of a PSC personal service company within the contracting sector is defined as any limited company that has typically a single contractor, director, or the one with most of or all of the company shares.

The contractor’s PSC usually offers professional services to end-users, either through an agency or directly. The professional services include typical IT or engineering services and are offered by the contractor, just to reinforce the point, they are also the director or owner of the business.

You should try to identify or approach anyone you think might be a PSC of the company. If they deny providing their PSC information, they’re committing a criminal offense.

4. What is a person of significant control in a company?

A Person with significant control (PSC) is someone who meets at least one of the conditions of control given below:

PSCs are mostly people who hold;

Greater than 25% of the company shares .
Greater than 25% of the right to vote in your company.
Holds the special right to designate or fire the majority of the companies’ board of directors.
In case the PSC holds higher than 25% of shares of the company, the PSC is likely to have the same amount of voting rights.
You should check the company’s register with shareholders’ information. Your company’s constitution and articles of association should also contain information on voting and other rights.
Also, ensure that the PSC register is always kept up to date.

5. Can a PSC remove a director?

IT is important to note that a Person with Significant Control (PSC) of the limited company or LLPs holds the right to designate or fire most of the directors/management of a company or LLP. So, Yes a PSC can remove a director from the company. However, it is obligatory for all the Limited companies to have a minimum of one natural (human) director. Hence as soon as a director is removed, another director has to be appointed immediately and Companies House must be informed. As mentioned above, not updating the PSC register is considered a criminal offense.

6. Can you have more than one PSC?

Yes, a company can surely have one or more persons of significant control. The PSC of a company is anyone who has more than 25% of the company shares or has more than 25% voting rights. If your company has more people with greater than 25% of the shares or voting rights, all those are considered as the PSC of your company. There is no rule as such to have only one PSC for one company.

In case you want to register a PSC at Companies House you can post or file PSC details online at Companies House, using the form PSC01 which is meant for individual ‘natural person’ PSCs or you can choose to intimate the Companies House of the corporate entity as an RLE by using the other form PSC02 (for Registrable Legal Entities).

What is a PSC Register? – A Comprehensive Guide