Economic Crime and Corporate Transparency Act 2023 - ID Verification

The Economic Crime and Corporate Transparency Act 2023 (“ECCTA”) makes significant changes to UK law and is aimed at tackling economic crime and making UK-registered entities more transparent.

One big change which will come into force on 18 November 2025 is that certain individuals will need to formally verify their identity with Companies House.

Organisations in the construction sector, including contractors, employers and consultants, should have ID verification on their radar to ensure compliance with the new statutory requirements.

Who needs to verify their identity?

Individuals need to complete the identity verification process if they fall into one of these categories:

• a director of a company registered in the UK (England and Wales, Scotland, or Northern Ireland);
• a member of a UK limited liability partnership (LLP);
• a Person with Significant Control (PSC) of a UK company or LLP;
• a director of an overseas company with a UK establishment.

Identity verification is a one-time process for the individual. Once verified, individuals do not need to re-verify for each role they hold or otherwise re-verify on a periodic basis.

What are the timings for ID verification?

Since 8 April 2025, individuals have been able to voluntarily verify their identity (see below for more detail on how to ID verify).

ID verification will become mandatory on 18 November 2025.

When the new ID verification rules come into effect:

• New appointments: All newly appointed directors and individual members of LLPs must complete identity verification before they begin acting in their role. It is an offence to act as a director or member of an LLP unless the individual’s identity is verified, and Companies House must be notified within 14 days of the appointment. The company and LLP, and every officer in default, also commits an offence if they fail to ensure that a director or member does not act unless their identity is verified.
• When submitting a notice of appointment to Companies House, the filing must confirm that the individual's identity has been verified and must include their unique verification code. This code is issued by Companies House upon successful completion of identity verification.
• PSCs are subject to a slightly different process. Notice of new PSCs must be filed with Companies House and may confirm at that time whether the individual’s identity has been verified. If identity verification is not confirmed, Companies House will contact the PSC directly, who must then complete the verification process within 14 days.
• New incorporations: For any new UK company or LLP incorporation, all individual directors and members must be verified before registration. The incorporation application must confirm that all applicable individuals have completed ID verification and include the individual’s unique verification code. Again, PSCs are treated slightly differently: a company may choose to confirm a PSC's verification on incorporation. If not, Companies House will contact the PSC, who must then confirm their identity is verified within 14 days.   
• Existing roles – transition period: A 12-month transition period will apply for existing directors and members. However, not all companies and LLPs will benefit from the full 12 months. Each UK-registered company or LLP must comply by the time its first confirmation statement is due after the new requirements take effect. The situation is slightly different for PSCs. If an individual is a director and PSC of the same company, the PSC must complete their ID verification and provide their unique verification code to Companies House within 14 days of the company’s confirmation statement date. If an individual is a PSC but not a director of the same company, they must provide their unique verification code within the first 14 days of their birth month.
• Overseas companies: While in the UK, a new director of an overseas company with a UK establishment must not act as a director of the company in respect of the affairs of the UK establishment unless their identity is verified. Confirmation of verification must be given to Companies House within a 21-day period. There is a transition period for existing directors. Confirmation of a director’s ID verification must be notified to Companies House by the date of the first anniversary of the UK’s establishment that falls after the regulations requiring ID verification come into force.

As above, once an individual’s identity has been verified, a unique verification code will be issued. This code will be essential for various Companies House filings, including the first confirmation statement after 18 November 2025, registering a new company and registering as a PSC.

Are there any exemptions from identity verification?

There are only limited circumstances where a person will not be required to ID verify, for example, in the interests of national security or to prevent serious crime.

How to ID verify?

There are three ways to verify your identity:

1. Online via GOV.UK One Login
   You can verify your identity using the GOV.UK One Login app or website. To do this, you will need a specific form of photographic ID, such as a biometric passport (from any country) or a UK photo driving licence. This is a free and user-friendly service. Most individuals required to verify their identity are expected to use this method. (See our short guidance note for help.)
2. At a UK Post Office
   If you are unable to use the online service and live in the UK, you may be able to verify your identity at a participating UK Post Office.
3. Through an Authorised Corporate Service Provider (ACSP)
   You can also choose to have your identity verified by a UK-registered ACSP. You will need to provide specific documents for verification, and the provider may charge a fee for this service.

What does ID verification mean for the construction sector?

From 18 November 2025, the ID verification requirements will apply to most UK-registered entities, including construction companies. Given the timescales, it is important to:

• Review records to identify individuals who will need to verify their identity, in particular, where a construction company forms part of a bigger group.
• Check confirmation statement due dates after autumn 2025 to ensure compliance.
• Raise awareness internally of the ID verification requirements for new and existing appointments.
• Ensure up-to-date identity documents are available from individuals to complete ID verification and avoid late filings.

ID verification is only one of the changes introduced by ECCTA. As discussed below, the failure to prevent fraud offence came into effect on 1 September 2025 and other changes relevant to the construction sector are due to be implemented over the next 18 months. For example, from spring 2026 changes will apply to those filing documents at Companies House on their own behalf or on behalf of others.

If you would like our assistance, or if you’d like to discuss the new requirements in more detail, please don’t hesitate to get in touch.

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