Using MR05 when property is released from a company charge

After a company sells a charged asset or agrees a release with its lender, the Companies House record can tell a different story from the transaction file. MR05 records a statement that property has been released from a charge, no longer forms part of the company's property or undertaking, or both. It is not a receipt showing that a loan was repaid.

The distinction matters because MR05 leaves the charge recorded as outstanding, with a notation about the property. Satisfaction or discharge of the charge is the separate MR04 task. For an England and Wales company, preparing MR05 means identifying the right charge, distinguishing part from all of the charged property, and matching the statement to the actual release or disposal evidence. This guide explains those records decisions, not how to negotiate a release or transfer legal title. It is general information, not legal advice.

When is MR05 the right form?

MR05 records a statement that some or all of the property or undertaking charged has been released, no longer forms part of the company's property or undertaking, or both. Its registration leaves the charge shown as outstanding, with the relevant notation.

That usually comes up in situations such as:

• the lender agrees to release a specific asset from its security while the loan continues
• the company sells a charged item of equipment and it no longer forms part of the company's property
• part of a charged property portfolio is transferred out
• all charged assets have left the company's ownership, but the charge itself has not been recorded as satisfied or discharged

MR05 is therefore about the scope of the charged property on the public register. It is not a receipt for payment and it is not proof that the lender has been fully repaid.

Companies House says that filing MR05 does not state that a charge has been satisfied. Once registered, the charge remains listed as an outstanding charge, with a notation showing what was released or ceased to belong.

If the real event is that the charge has been satisfied or discharged, the correct filing is MR04.

That is why founders often get tripped up after a transaction. They know something has changed in the lender relationship, but the question is not simply, "Has money been paid?" The question is, "What exactly changed about the charge?" If the answer is that property has been carved out or has left company ownership, MR05 may be the form you need. If the answer is that the secured obligation has ended and the charge is discharged, you are in MR04 territory instead.

What MR05 does not do

It helps to be clear about what this filing is and is not.

MR05 records a statement on the Companies House register. It does not create the release, negotiate it, or replace the underlying lender consent or release documentation.

In other words, an MR05 filing is not the legal instrument that frees the asset. The actual release will usually come from whatever has been agreed between the company and the lender, or from the transaction documents dealing with the sale or transfer of the asset.

It also does not complete a disposal of property, transfer title, or confirm that completion steps have been handled correctly elsewhere. If a property or business asset is being sold, the commercial documents and completion mechanics still need to stand on their own.

This matters in practice because businesses sometimes treat the Companies House filing as the whole job. It is only one record step. Before anyone files anything, make sure your records show the underlying reason why the asset was released or why it stopped belonging to the company.

Helpful documents might include a lender release letter, deed of release, asset sale agreement, asset transfer paperwork, completion statements, board approvals, and internal asset records. Not every transaction will need the same documents, but the filing should reflect a real, supportable event rather than guesswork.

How to identify the right charge on the register

Before completing the form, identify the company exactly as Companies House records it. The company name and company number must match the register.

Then identify the relevant charge. The way you do that depends on when the charge was created, or when the property was acquired.

For charges created or property acquired before 6 April 2013, the form uses Part A and Part C. For charges created or property acquired on or after 6 April 2013, the form uses Part B and Part C.

That date wording is important. The official guidance in the form MR05 checklist refers not only to charge creation, but also to the date property was acquired. Do not simplify the question too far if the asset became subject to the charge through acquisition.

For older charges under Part A, the form may ask for:

• the date the charge was created, or the date of acquisition
• the charge number, if available
• the description of the instrument
• short particulars of the property or undertaking charged

The charge number is not stated to be mandatory in that older section, but using it where available can help Companies House identify the correct entry. If there is more than one charge with a similar date, description and particulars, extra identifying detail can be especially useful.

For newer charges under Part B, the form uses the charge code found on the certificate of registration. Do not assume every charge will conveniently fit one modern reference style. The right identifier depends on the age and registration framework of the charge in question.

As a practical step, compare the register entry, the original registration paperwork and any lender documents before you draft the filing. A mismatch here can lead to rejection or, worse, a statement being linked to the wrong charge.

Choosing part or all for the property statement

The most important choice on MR05 is in section C1. You must select whether the change relates to part of the property or undertaking charged, or all of it, and then say whether the property has been released, no longer forms part of the company's property or undertaking, or both.

You should only choose what matches the facts.

If only some of the charged assets have been released or have left the business, select part. If the whole of the property or undertaking charged has been released or has ceased to belong, select all.

This is not just wording. It affects whether section C2 needs to be completed.

If you select part, you must complete section C2 with a brief description of the assets or property involved. That description should identify what has been released and or what no longer forms part of the company's property or undertaking.

If you select all, you do not need to complete section C2.

A few examples show why the distinction matters:

A company gives a lender security over machinery and stock. Later, one specific machine is sold with the lender's agreement. The charge still covers the rest. That points toward part, and section C2 should briefly describe the machine released or no longer owned.

A company's only charged asset is a commercial unit, and the lender agrees that the unit is released from the charge while the wider loan arrangements continue in some form. That may point toward all, because the whole charged property has been released. In that case C2 is not needed.

A business has floating and fixed security over a changing asset pool. Some assets are sold in the ordinary course and no longer belong to the company, but the overall charge remains. Whether MR05 is needed at all will depend on the actual transaction and records. You should avoid assuming every asset movement requires an MR05, but where a filing is being made, the form must describe the true scope of what has ceased to belong or been released.

The form also lets you distinguish between property being released from the charge and property simply no longer forming part of the company's property or undertaking. Sometimes both are true. For example, a charged asset may be sold and the lender may also formally release it. Choose the option that matches the actual event rather than treating the labels as interchangeable.

How to complete section C3 properly

Section C3 deals with the person delivering the statement and their interest in the charge.

You need to include the name of the person delivering the statement, their address and their interest in the charge. The person delivering it could be the company as chargor, the lender as chargee, or a third party acting on behalf of one of them, such as a professional adviser.

The address does not have to be a residential address. A service address or the company's registered office may be used where appropriate.

The signature point is easy to overlook. The form must be signed by the person detailed in section C3, and Companies House says it must be a manuscript signature or an automatically generated signature. Typeface is not accepted.

That means a simple typed name in a font should not be treated as a valid signature. If your filing process uses generated signatures, make sure the output fits what Companies House accepts.

What happens if the form is wrong?

Companies House examiners check the form. If it contains errors, the form may be rejected and returned to the presenter named in the presenter information section. If that section has been left blank, the rejected form may be returned to the company's registered office.

The practical lesson is that small completion errors can create avoidable delays, especially where a transaction file is being cleaned up after completion and several parties expect the public record to be updated quickly.

The official guidance also says that an MR05 cannot be informally corrected under section 1075 of the Companies Act 2006. So this is not a form to file casually on the basis that a minor error can always be tidied up informally later.

That does not mean every issue becomes a crisis, but it does mean accuracy matters at the point of filing. Check the company details, identify the correct charge framework, confirm whether the change is part or all, and make sure any asset description is brief but specific enough to be meaningful.

Practical examples founders often face

Consider a startup that bought specialist equipment using lender finance secured over all present and future equipment. Two years later it disposes of one old machine as part of an upgrade. If the lender has agreed that the machine is released from the charge, or if it no longer forms part of the company's property and the register needs noting accordingly, MR05 may be relevant for that charge as a part release or part cessation case. The debt itself may still continue.

Now compare that with a company that repays the secured borrowing in full and the lender discharges the security. That is not merely a property release issue. The question is satisfaction or discharge of the charge, so MR04 is the filing to consider rather than MR05.

Take another example involving business premises. A company has granted a charge affecting a property portfolio. One unit is sold off. If only that unit leaves the charged pool, the filing logic is usually about part, and the released or disposed asset should be described in C2. If the charge related only to one property and that whole property is the asset leaving the charge scope, all may be the better fit.

These examples are illustrations, not definitive rulings. The correct filing depends on the actual security documents, the transaction steps and what happened to the charged property.

FAQ

Does filing MR05 remove the charge from the register?

No. The charge remains shown as outstanding, with a notation about the released property or property that no longer forms part of the company's undertaking.

Can I use one MR05 for several charges?

No. The current Companies House guidance says you should file one form MR05 for each charge you want the statement registered against.

Do I always need to describe the asset in section C2?

No. You only complete section C2 if section C1 is marked as part. If section C1 is marked as all, section C2 is not required.

Who can deliver the statement?

The person delivering the statement can be the chargor (the company), the chargee (the lender), or a third party acting on behalf of either. The form must state the deliverer's interest in the charge.

Does selling an asset automatically mean MR05 is required?

Not necessarily. The filing question depends on the charge, the asset, and what has actually happened to the charged property. A disposal should prompt a check of the charge record and supporting documents, but you should not assume every asset transaction requires MR05.

Key Takeaways

• MR05 is for recording that charged property has been released, no longer belongs to the company, or both. It is not the form for saying the debt has been repaid.
• Filing MR05 does not satisfy or discharge the charge. If the charge itself has been satisfied or discharged, the relevant filing is MR04.
• Use the company name and number exactly as recorded, then identify the charge using the correct older or newer form section depending on when the charge was created or property acquired.
• The part or all choice in section C1 matters. If you select part, section C2 must briefly describe the relevant assets or property. If you select all, C2 is not needed.
• MR05 records a statement on the register. It does not replace the underlying lender release, sale documentation or transaction steps.
• Errors can lead to rejection, and MR05 cannot be informally corrected under section 1075, so accuracy at filing stage is worth the extra care.

If you are reconciling a property release, asset disposal, charge record update or lender release paperwork, Sprintlaw's team can help you organise the documents and work through the filing position. For support with charge-related documents, business sale paperwork or company transaction records, call 08081347754 or email team@sprintlaw.co.uk.