Companies House will introduce changes to accounts filing due to governmental reforms under the Economic Crime and Corporate Transparency Act 2023 (ECCT Act 2023).
The changes will now come into effect from April 2028, rather than April 2027 as previously announced, to give companies more time to prepare.
What are the reforms?
The reforms include requirements for small companies and micro entities to file profit and loss accounts with Companies House as larger companies do. They will have the option to opt out of publishing this information on the public register.
As with Making Tax Digital, companies will be required to file annual accounts via commercial software.
Additional limitations
The new rules will introduce additional limitations, including the removal of the option for companies to file abridged accounts, and reducing the number of times a company can shorten its accounting reference period. There will also be a strengthened eligibility statement for all companies claiming an audit exemption and a requirement that the component parts of the accounts and reports be filed together.
How you will know whether you are affected
Companies House will contact all companies via their registered email address to tell them about these changes and signpost available guidance.
Although transparency and data clarity were prime factors in the planned changes, allowing small companies and micro-entities to opt out of publishing their filed profit and loss accounts protects their privacy and mitigates commercial risks.
Software-only accounts filing
From April 2028, Companies House will require all UK-registered companies to file their accounts in Inline eXtensible Business Reporting Language (iXBRL) format by using commercial software. This applies to companies that file their own accounts and those using third-party agents or accountants to file their annual accounts. Web and paper-based filing systems will be closed for account filings.
The full details of changes will be confirmed in due course but are likely to increase the operating costs of small businesses.
To select a software provider, Companies House recommends using the interactive list of software providers on GOV.UK.
https://www.gov.uk/software-company-accounts
The information provided in this blog is for general informational purposes only and should not be considered professional advice. As far as we are aware, the content is accurate at time of publication. Torgersens assumes no responsibility for errors or omissions in the content or for any actions taken based on the information provided.
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