Companies House launches awareness campaign aimed at flat management company directors
A campaign aimed at building a better understanding of the responsibilities that come with being the director of a flat management company is being launched by Companies House.
Every year, Companies House receives complaints from residents living in shared buildings or properties such as flats, a significant number of which it has no powers to deal with. These can range from disputes between residents to the poor condition of carpets or paintwork in shared areas such as stairways.
Such properties are commonly run by companies set up by residents – who take on the roles of directors and/or shareholders – to manage communal areas and the overall condition of the building.
Each company is required by law to file accounts with Companies House every year, which can lead to confusion among some directors and shareholders as to where the responsibility for some issues lie. When registering, all companies must agree a set of written rules, or articles of association, about the running of the company.
The campaign includes the unveiling of a free online flat management tool which guides directors through exactly what they need to know. It’s completely free, works on any device and can be completed in just 25 minutes.
Companies House Director of Operations John-Mark Frost said:
“We receive a significant number of complaints each year regarding these companies. Often we find that residents are confused about their responsibilities and what Companies House can or can’t help with.
“All company directors must be aware of their legal responsibilities both to Companies House and to their shareholders or members. This includes keeping information up to date and filing the necessary documents in a timely fashion.
“Although the tool does not replace independent legal or professional advice, we hope it will be of immense help for people who are looking for help or guidance.”
The online flat management tool covers five key parts, namely (i) Companies House and your flat management company (ii) becoming a director (iii) keeping records (iv) filing accounts and types of accounts, and (v) a quiz to test your knowledge.
You can find more information in our Flat management and right to manage (RTM) companies guidance. Property management law is different in Scotland. Read the Scottish government’s guidance on property factors.
The tool has received support from the Federation of Private Residents Associations (FPRA), a not-for-profit lease advice, support and lobbying organisation for private residential leaseholders, tenants’ and residents’ associations, residential management companies and flat management companies.
Bob Smytherman, chair of the FPRA, said:
“We very much welcome the introduction of this new online tool from Companies House.
“We represent residential management and right-to-manage company members right across England and Wales and we know all too well some of the difficulties that they can experience.
“Becoming a director of a company is a significant step and the position comes with a number of responsibilities. This additional support to help directors understand these responsibilities will, I’m sure, prove to be incredibly valuable.”