If you’ve been keeping an eye on the regulatory landscape lately, you’ll know that the Economic Crime and Corporate Transparency Act (ECCTA) has landed with quite a thud on the desks of UK business owners. For those of us in the accountancy world, it’s not just another bit of red tape; it’s a fundamental shift in how we manage our own firms and how we advise our clients.
I’m Peter Watson, and over the years, I’ve helped countless practice owners navigate the complexities of a practice sale, accountancy mergers, and achieving the best possible accountancy practice valuation. One thing I’ve learned is that "clean" records are worth their weight in gold when it comes to due diligence. Right now, the biggest threat to that cleanliness is the new Companies House ID verification process.
It sounds simple enough: prove you are who you say you are. But as the saying goes, the devil is in the detail. I’ve seen seasoned professionals trip up on these new requirements, and if you’re planning on selling your accountancy firm or looking into practice acquisition, these mistakes can cause unwanted friction.
Here are the 7 most common mistakes I’m seeing right now, and more importantly, how you can fix them before they become a headache for your practice.
1. Thinking the 11-Character Code is the Finish Line
The most common misconception I hear from retiring accountants is that once they’ve received their 11-character personal ID code from Companies House, they are "verified" and can tick it off the list.
Unfortunately, that’s only the first half of the battle. Obtaining the code is stage one. Stage two is linking that code to every single directorship and Person with Significant Control (PSC) role you hold. If you have the code sitting in your inbox but haven’t submitted it against your specific roles in the submission window, you are technically non-compliant.
How to fix it: Treat the ID code as a key. A key is useless until you put it in the lock. Ensure you (or your secretarial team) have a process to log into Companies House and actively link that code to every relevant position.
2. The "Bill vs. William" Name Mismatch
This is a classic technical snag that’s causing a high rate of rejections. Let’s say your passport says "William George Jones," but when you set up your firm years ago, you registered yourself at Companies House as "Bill Jones."
The new verification system uses automated matching. If the name on your verified ID doesn’t exactly match the name on the Companies House register, the system will likely spit it out. This is a common issue for those looking at accountancy practices for sale; if the directors' records are messy, it can slow down a practice sale significantly.
How to fix it: You have two routes. When prompted, you can select the "preferred name" explanation, which flags the discrepancy for manual review. However, the cleaner way is to simply amend your Companies House record to match your legal ID before you start the verification. It makes life much easier for future accountancy practice buyers during due diligence.
3. The "One and Done" Submission Error
Many practice owners wear multiple hats. You might be a Director of your main limited company, a Director of a service company, and a PSC for both.
A frequent mistake is submitting your ID verification code once and assuming the system "knows" it’s you across all roles. It doesn’t. Unless the records are perfectly aligned and linked, you must submit that code for each individual role. I’ve seen cases where a director is compliant, but their PSC filing is flagged as overdue because they thought one submission covered everything.
How to fix it: Audit your roles. If you’re involved in accountancy mergers & acquisitions, check every entity involved. Verify your ID code separately for every single role you hold on the register.
4. Ignoring Incorrect Dates of Birth
You’d be surprised how many historic records at Companies House contain typos, particularly in the date of birth field. Perhaps a clerk made a mistake in 1998, and it’s sat there ever since.
When you go to verify your ID now, the system will compare your ID document (which has your correct DOB) against the register. If they don’t match, the verification will fail. If you’re a retiring accountant trying to tidy up your firm for a practice sale, this is a small detail that can cause a large delay.
How to fix it: Don’t wait for the submission window to open. Go to Companies House now and check your details. If the DOB is wrong, you’ll need to correct it. While some suggest "cease and reappoint" workarounds, it's always better to follow the formal correction process to keep your filing history transparent.
5. Using Invalid or "Glitchy" ID Documents
We live in a digital age, but hardware fails. The Gov.UK One verification process often relies on the NFC (Near Field Communication) chip in your passport. If that chip is broken, or if your passport has expired, the automated verification won't work.
Furthermore, if you’re using a photo driving licence that’s past its photocard expiry date (even if your driving entitlement is still valid), it will be rejected. For anyone looking to buy a practice or sell your practice, having valid, up-to-date ID is a basic requirement that often gets overlooked until the last minute.
How to fix it: Check your passport and licence expiry dates today. If the digital route fails, don’t panic. Companies House allows for verification via an Authorised Corporate Service Provider (ACSP). As an accountancy broker, I always suggest having a backup plan if the tech fails you.
6. Failing to Track Fragmented Submission Windows
This is perhaps the most dangerous mistake for a busy practitioner. Submission windows aren't uniform. They are often tied to your company’s anniversary or specific filing deadlines. If you have multiple companies, you have multiple deadlines.
I’ve seen firms where the directors are verified for the main practice, but they’ve missed the window for a small bookkeeping business or a property holding company. In the eyes of the law, a miss is a miss.
How to fix it: Treat this like your tax return cycle. Use your company secretarial software or a dedicated spreadsheet to track every entity. If you're managing recurring fees and a large client base, you know the value of a good CRM, apply that same rigour to your own compliance.
7. Submitting Poor Quality Data or Photos
It sounds basic, but "human error" is a huge factor. Cropped photos of passports, glare from a lightbulb over your ID card, or accidentally cutting off your middle name during data entry will lead to an automatic "No."
When I speak to people about accountancy practice valuation, we often talk about the "quality of earnings." Well, this is the "quality of compliance." If your internal records are sloppy, it suggests to a potential buyer that other areas of the business might be too.
How to fix it: Take your time. Use a modern smartphone, ensure you're in a well-lit room (natural light is best), and double-check every character of data before you hit submit.
Why This Matters for Your Practice Sale
You might be wondering why a broker specializing in the sale, purchase, and valuation of accountancy practices is talking about ID verification.
The reason is simple: Value.
When I’m representing a seller, my job is to ensure the acquisition goes as smoothly as possible. When a buyer (or their legal team) looks at your firm, they look for "red flags." Overdue filings or issues with ID verification are massive red flags. They suggest a lack of attention to detail or, worse, underlying regulatory issues.
Whether you are a retiring accountant looking to exit or a firm looking to buy accountancy practice portfolios to grow your recurring fees, compliance is the foundation of a successful deal. If you're looking for a bookkeeping business for sale or planning practice mergers UK wide, these Companies House changes are now a standard part of the due diligence checklist.
I’ve seen how competitors like Retiring Accountant or Vivian Sram approach the market, and while they focus on the listings, I focus on the person and the preparation. Getting your ID verification right is a key part of that preparation.
Get Your Practice Ready
Don't let a simple administrative hurdle like ID verification devalue years of hard work. If you're unsure about how these changes affect your accountancy practice valuation or if you're thinking it might be time to sell accountancy practice assets and move on to the next chapter, let's have a chat.
I offer a personal, one-to-one service that goes far beyond just being an accountancy broker. I’m here to help you navigate the entire journey: from the first valuation to the final handshake.
Ready to discuss the future of your practice?
Book a confidential 1-2-1 call with me here
Whether you’re looking to buy a practice, sell your practice, or you just want to know what your firm is worth in today’s market, I’m here to help. You can also find more information about my background and how I work at bainswatts.co.uk/peter-watson.
Let's make sure your practice is compliant, professional, and ready for whatever comes next.
Peter Watson is the Director/Owner of Bains Watts Ltd, the UK’s leading consultancy for accountancy practice mergers, acquisitions, and valuations.