If you’re a company director, you may have recently received an email from Companies House about upcoming changes to how annual accounts will be filed.
At first glance, it can seem like a lot to take in. The good news is that these changes don’t come into effect until 1 April 2028, so there’s plenty of time to prepare.
Here’s a simple overview of what’s changing and what it means for your business.
Why Are These Changes Being Introduced?
The changes form part of the Economic Crime and Corporate Transparency Act 2023, which aims to improve the quality of information held by Companies House and help tackle fraud and economic crime.
As part of these reforms, the government is changing how annual accounts are filed and what information companies will need to provide.
What Is Changing?
There are three main changes businesses should be aware of.
1. Annual accounts will need to be filed using software
From 1 April 2028, Companies House will no longer accept paper accounts or accounts filed through its existing web service.
Instead, all annual accounts must be submitted using compatible commercial software.
If your accountant already files your accounts using software, you may not need to do anything. However, if you currently prepare and submit your own accounts, it’s worth thinking about moving to software well before the deadline.
2. Small companies and micro-entities will file more information
Currently, many smaller companies can file simplified accounts.
From April 2028, small companies and micro-entities will also need to file a Profit & Loss Account with Companies House, bringing them more in line with larger companies.
3. You can choose not to publish your Profit & Loss Account
One concern raised during consultation was that smaller businesses would have to make more financial information publicly available.
To address this, the government has confirmed that small companies and micro-entities will be able to opt out of having their Profit & Loss Account published on the public register.
Further guidance on how this process will work is expected closer to implementation.
Why Has the Deadline Changed?
Originally, these reforms were due to begin in April 2027.
Following further consultation with businesses and accountants, the implementation date has been pushed back to 1 April 2028.
This gives companies a full accounting year plus nine months to prepare for the changes.
What Does This Mean for Your Business?
The good news is that, for many businesses, there’s no immediate action required.
If your accounts are already prepared and submitted through accounting software, or your accountant takes care of your annual filings, you may not need to make any changes at all.
However, if you currently prepare and file your own accounts without using software, now is a good time to start thinking about how you’ll make the switch. Although the new requirements don’t come into effect until April 2028, preparing early will make the transition much smoother and help avoid any last-minute pressure.
If you’re unsure how these changes apply to your company, we’re here to help. Whether you need advice on the new filing requirements, guidance on software filing or support with preparing and submitting your annual accounts, our team is happy to talk things through.
As more guidance is released by Companies House over the coming months, we’ll continue to keep you and our clients updated so you’re ready well before the new rules come into effect.