Rectifying the register of members

Errors in a company’s register of members are corrected either by the company completing a step the Companies Act already requires of it, such as registering a properly lodged transfer, or by an application to court under section 125 of the Companies Act 2006. Under section 125 the person aggrieved, any member or the company itself can ask the court to rectify a register that leaves out information it must contain or includes information it should not, and the court can also order the company to pay damages and decide who owns the shares.

Why does an error in the register of members cause so much trouble?

The register of members is not just an administrative list. Section 112(2) says that a person who agrees to become a member, other than a subscriber, becomes a member when their name is entered in the register. Article 26(4) of the Model Articles for private companies says the transferor remains the holder of a share until the transferee’s name is entered. Section 127 makes the register prima facie evidence of what the Act requires it to contain.

So if the register is wrong, the law starts from the wrong answer. A buyer who has paid for shares but was never entered is not yet a member, and someone shown on the register who should not be there will look like the holder until somebody proves otherwise. Rectification is the process of making the register match the true legal position. The wider problem of registers that have simply not been kept is covered in what to do if the statutory registers are not up to date.

What kinds of error can be rectified?

Section 125(1) now applies where the register of members does not include information it is required to include, or includes information it is not required to include. That wording was substituted by the Economic Crime and Corporate Transparency Act 2023 and has been fully in force since 4 March 2024. The earlier wording was narrower, referring to a name entered or omitted without sufficient cause, or default or unnecessary delay in recording that someone had ceased to be a member.

Typical situations include:

• a transfer entered in the register even though no proper instrument of transfer was delivered, which section 770 forbids;
• shares entered against a person under an allotment that was never validly made;
• a former member still shown as holding shares, or a member shown with the wrong number or class of shares;
• a transferee left off the register after a transfer that the company was bound to register;
• a dispute about whether shares were ever validly transferred at all.

Can the company correct the register without going to court?

The Act does not contain a separate procedure for a company to rewrite its own register. What it does contain are the ordinary duties that produce correct entries in the first place. When a transfer is lodged, section 771 requires the company to register it or give notice of refusal with reasons within two months. When a former member has been off the register for ten years, section 121 allows the entry about them to be removed. Where the correct entry simply follows from documents the company already holds and nobody disputes the position, the board completes the missing step, records it in the minutes and updates the register as at the date of the decision.

Section 125 is the route when the change cannot be made that way: where it would remove shares from someone who does not agree, where the evidence is incomplete, or where the question is who owns the shares. Because the company itself is listed as a possible applicant, a board facing a contested or uncertain correction can ask the court to decide rather than taking the risk itself.

Who can apply under section 125 and what can the court order?

Three categories of person can apply: the person aggrieved, any member of the company, and the company. On the application:

• the court may refuse the application, or order rectification of the register and payment by the company of any damages sustained by any party aggrieved (section 125(2));
• the court may decide any question relating to the title of a party who wants their name entered in or omitted from the register, whether the dispute is between members or alleged members, or between them and the company, and generally any question needed to rectify the register (section 125(3));
• where the company is required to send a list of its members to Companies House, the order must direct that notice of the rectification is given to the registrar (section 125(4)).

One limit is worth knowing. Section 126 says no notice of any trust, express, implied or constructive, may be entered on the register of members of a company registered in England and Wales or Northern Ireland. Rectification puts the right legal holder on the register; it is not a way to record a beneficial owner behind a nominee shareholder.

How does a rectification application work in practice?

1. Pin down the error. Identify the exact entry that is wrong and what it should say, by number and class of shares and the date the change should take effect.
2. Assemble the evidence. Stock transfer forms, HMRC Stamp Duty letters, share certificates, board minutes, members’ resolutions, returns of allotment and confirmation statements filed at Companies House.
3. Find out who is affected. Everyone whose entry would change needs to know. If they all agree and the change follows from existing documents, the board may be able to make it without court; if anyone objects or the evidence is missing, the court is the safer route.
4. Apply to court. The applicant asks for the specific entry to be made or removed and, if relevant, for damages. Legal advice on the form of application and who must be served is normally needed.
5. Implement the order. Update the register exactly as the order says, keep a copy of the order with the register and give notice to the registrar as the order directs.
6. Tidy up the public record. Companies House guidance says changes to shareholder information can be reported in the additional information section of the next confirmation statement. Check whether the change affects anyone’s status as a person with significant control.

Is there a time limit?

Section 128 provides that a company’s liability arising from making or deleting an entry in the register of members, or from failing to make or delete one, is not enforceable more than ten years after the date of the entry, deletion or first failure. Shorter limitation periods still apply where relevant. The ten year limit concerns claims against the company; it does not make an old error correct, so a stale mistake can still need fixing before a sale or investment.

Separately, the company’s records are open to scrutiny. Members can inspect the register free of charge under section 116, and errors are often spotted that way; see who can inspect the register of members.

What does a rectification look like?

Illustration only. Harbour Ltd has 100 shares. In 2022 Sam signed a stock transfer form for 20 shares in favour of Jo, and Jo paid. The company secretary entered Jo in the register, but nobody can now find the signed form, and Sam says the sale was never completed and he is still owed money.

• Section 770 says a transfer may not be registered unless a proper instrument has been delivered. If no form was ever lodged, the register may include information it should not.
• Sam and Jo disagree, so the board should not simply delete Jo’s entry. Either of them, or the company, can apply under section 125 and ask the court to decide who holds the 20 shares.
• If the court finds the transfer was valid, Jo’s entry stays. If it finds it was not, the court orders the register rectified to restore Sam and can order the company to pay damages to an aggrieved party.
• Whatever the result, the company updates the register, notifies the registrar as directed and corrects the shareholder information on its next confirmation statement.

What mistakes make rectification harder?

• Deleting or altering entries quietly instead of minuting what was changed, when and on what evidence.
• Writing backdated board minutes to cover a gap, rather than recording today what the board now knows.
• Treating a disputed title question as an administrative fix; where someone objects, section 125 exists so that a court decides.
• Leaving a lodged transfer unprocessed, which turns a routine registration into a rectification problem; the rules on refusing to register a transfer set a two month deadline.
• Trying to record a trust or beneficial interest on the register of an England and Wales company, which section 126 prohibits.
• Forgetting the knock on effects on share certificates, the confirmation statement and dividends already paid.

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Related Accountapedia entries

• Transferring shares in a private company
• What to do if a share certificate is lost
• A company’s statutory registers
• What happens to company shares on divorce
• What happens when a sole director dies

Sources

• legislation.gov.uk: Act 2006 c. 46, section 112
• legislation.gov.uk: SI 2008/3229, schedule 1
• legislation.gov.uk: Act 2006 c. 46, section 127
• legislation.gov.uk: Act 2006 c. 46, section 125
• legislation.gov.uk: Act 2006 c. 46, section 125
• legislation.gov.uk: Act 2006 c. 46, section 126
• legislation.gov.uk: Act 2006 c. 46, section 770
• legislation.gov.uk: Act 2006 c. 46, section 771
• legislation.gov.uk: Act 2006 c. 46, section 121
• legislation.gov.uk: Act 2006 c. 46, section 128

Reviewed by Christine Anderson, Broker, Solar Protect. Last reviewed 19 October 2026. Part of Accountapedia, the Solar Protect guide to UK tax and accounting. This page is general information, not personalised advice.