The UK government has confirmed that major reforms to Companies House filing requirements for small companies will now come into effect in April 2028, one year later than originally planned.
The changes form part of the Economic Crime and Corporate Transparency Act 2023, a package of reforms designed to improve corporate transparency, strengthen the integrity of the Companies House register and support efforts to tackle economic crime.
The delay gives businesses additional time to prepare for what will be the most significant changes to small company accounts filing requirements in recent years.
What Will Change?
Under the new rules, small companies will face increased reporting requirements when submitting accounts to Companies House.
Key changes include:
- Small companies will be required to file a profit and loss account.
- Directors' reports will need to be submitted unless a company qualifies for an exemption.
- Micro-entities will be required to file both a balance sheet and a profit and loss account.
- The current options to file abridged or filleted accounts will be removed.
- Companies will be required to submit accounts using approved commercial software, bringing an end to paper-based and Companies House web filing methods for annual accounts.
The reforms are intended to provide regulators and enforcement agencies with greater access to financial information while improving the accuracy and transparency of company reporting.
Will Profit and Loss Accounts Be Public?
One of the concerns raised by business owners has been the potential loss of privacy surrounding financial information.
The government has confirmed that small companies and micro-entities will be able to opt out of having their profit and loss accounts published on the public register. However, the information will still need to be filed and will remain accessible to Companies House, HMRC and relevant law enforcement authorities.
Further details on how businesses will exercise this opt-out are expected closer to implementation.
What Should Businesses Do Now?
Although the new requirements have been postponed until April 2028, businesses should not view the delay as a reason to postpone preparation.
Companies that currently rely on abridged or filleted accounts should begin reviewing their reporting processes and accounting systems to ensure they are ready for the transition to software-only filing. Directors should also be aware that greater financial disclosure to regulatory authorities will become a permanent feature of the UK's corporate reporting framework.
The additional preparation period provides an opportunity for businesses to assess their systems, seek professional advice and implement any necessary changes well ahead of the deadline.
Need Advice?
If you would like to understand how the upcoming Companies House reforms may affect your business, our team is here to help. Contact us for tailored advice on preparing for the new filing requirements and ensuring your reporting processes remain compliant.