Credit where it is due. The government’s own data shows that aspects of the roll-out have been well-executed. Nine in ten people who completed the check found it easy. The average completion time through the GOV.UK app runs under two and a half minutes. The digital service has stayed available 99.6% of the time, beating its own target (GOV.UK).
What has been challenging
Yet by late June this year, only around 36% of people with significant control had verified, with almost 1.5 million already past their deadline (AccountingWEB). The gap between the ease of experience and the completion rate is explained by the implementation of blanket compliance rules. In this instance, they fail to acknowledge the situation of micro-business owners and overcomplicate the identity verification process for them as a result.
Roughly 948,000 one-person limited companies fall within scope of the new identity verification rules (GOV.UK). A sole director-owner is treated in law as two separate people: a director and a person with significant control, each carrying their own identity verification process and deadline. For one-person companies, that means two submissions, linked to different dates with no prompt telling them a second step is required.
In a written interview, Joshua Finn CA (founder of a chartered accountancy practice called BK Plus Barnet and registered ACSP) told us that “many did not realise a second submission was required” (FOUNDRS report). Even for Joshua’s accountancy firm keeping on top of the deadlines was a challenge: “The ID verification itself has not been too much of a burden. It is keeping on top of, and tracking, the various deadlines that has caused the most issues.” He went on to say that “multiple deadlines for the same person should never have been the design” as it does not reflect “how business owners actually engage with Companies House”.
Why we need to learn fast
Identity verification is the first of several upcoming reforms. Of those, software-only accounts filing, which will be instated from April 2028, will potentially be the most disruptive for how some micro-businesses submit their own accounts, ending the free web and paper routes.
The lesson to learn for the government is simple: a single compliance rule, applied uniformly to businesses of different sizes, produces uneven consequences which typically fall hardest on the businesses least equipped to absorb them.
To encourage economic growth the government should shape their policies to incentivise business owners and ensure any necessary regulation is easy to follow and execute instead of confusing and distracting business owners that are trying to grow their companies.
Joshua Finn acknowledged as a solution that it would have been helpful to have been briefed on the step-by-step process, instead of the Companies House webinars which “covered the upcoming changes at a high level”.
Finally, at FOUNDRS we believe there is also an opportunity to reimagine how solo-founders run their business via private sector innovation. Solo-founders need support to obtain one connected picture of their compliance obligations as opposed to a scatter of separate deadlines owned by different service providers and different systems. That’s the goal we should be aiming for. It would assist the government in rolling out new regulation smoothly and help solo-founders to place it into context alongside their other compliance obligations so they have one clear picture.
Key takeaways
- Since November 2025, six to seven million company directors and people with significant control have faced new identity verification requirements from Companies House.
- By late June 2026, only around 36% of people with significant control had verified, with almost 1.5 million overdue – suggesting the process is too complex for many micro-businesses.
- Roughly 948,000 one-person limited companies fall within scope of the rules, yet the same blanket requirement applies to them as to large corporations.
- Identity verification is the first of several upcoming reforms – software-only accounts filing is next – making it critical that the government learns from this roll-out now.
- Callum Sommerton argues that compliance policy should be tiered by business size, with simpler routes for solo founders and micro-businesses to encourage economic growth rather than deter it.
