From April 2028, small companies and micro-entities will be required to file profit and loss accounts with Companies House. However, they will be able to opt out of publication of these accounts on the public register.
This follows the changes confirmed last week, which we covered in our earlier update: Companies House Filing Changes Confirmed for April 2028.
Opting Out of Public Publication
Under the new rules, small companies and micro-entities will still need to file their profit and loss accounts with Companies House.
However, they will have the option to prevent those profit and loss accounts from being published for public view on the Companies House register.
Details of how smaller companies will be able to opt out of publication of their profit and loss accounts are expected to be confirmed in due course.
Where a company opts out of publishing its profit and loss account, Companies House, law enforcement agencies and HMRC will still have access to the information. This is intended to help identify and tackle fraud, economic crime and tax evasion.
Abridged Accounts to Be Removed
Another significant change will be the end of abridged accounts, which will no longer be permitted.
This means small companies and micro-entities will need to prepare for a different approach to accounts filing from April 2028.
Directors’ Reports
The government has also indicated that it intends to remove the requirement for companies to produce a directors’ report as part of their annual report and accounts.
Further regulations and guidance are expected to confirm the final position.
Software-Only Filing and iXBRL
All companies will be required to file their accounts using commercial software in Inline eXtensible Business Reporting Language, commonly known as iXBRL.
It is important to note that web and paper-based filing systems will be closed for accounts filings from this date.
This means companies that currently file accounts themselves, as well as accountants and agents who file on behalf of clients, will need to ensure they have suitable software in place before the changes take effect.
Audit Exemption Statements
Under the new rules, companies claiming an audit exemption will also need to provide a strengthened eligibility statement.
Directors will need to confirm which audit exemption is being claimed and that the company qualifies for that exemption.
Filing Accounts and Reports Together
Companies will also be required to file the component parts of their accounts and reports together, rather than submitting them separately or in a fragmented way.
This is intended to improve the consistency and quality of information held on the Companies House register.
Accounting Reference Periods
Another change will introduce limits on the number of times a company can shorten its accounting reference period.
Where a company wishes to shorten its accounting reference period more than once within a five-year period, it will need to provide a business reason.
Time to Prepare
Companies will have 21 months to prepare for the changes. This is equivalent to one full accounting year, plus nine months.
Companies House has confirmed that it will contact all companies via their registered email address to explain the changes and signpost available guidance.
Accountants and advisers should therefore ensure that clients understand what is changing, what software may be required, and how the opt-out process may affect small companies and micro-entities once further details are published.
With thanks to Sara White, Editor, Business & Accountancy Daily.
