More Companies House changes are coming.
Before anyone panics, they’re not arriving until April 2028 and, despite some of the headlines, you may already be complying with most of them.
There is, however, one change that has understandably caused a few raised eyebrows: mandatory profit and loss account filing.
Nobody particularly wants their competitors, customers or staff casually browsing Companies House to find out quite how much money they make, what their margins look like or where all the money goes.
So, what’s actually changing? And does your accountant or finance team already have most of it covered?
How did we get here?
The Economic Crime and Corporate Transparency Act 2023 brought a raft of changes to Companies House and represented the first significant tightening of the rules in quite some time.
One of the biggest changes was identity verification.
Directors and Persons with Significant Control (PSCs) were required to verify their identities with Companies House, either through the free government service or using a commercially available service such as Simplified.ID.
Alternatively, an Authorised Corporate Service Provider (ACSP) could do this for you. An ACSP is a regulated professional, such as a solicitor or accountant, who is supervised for anti-money laundering purposes.
Overall, the process ran relatively smoothly.
There were, of course, a few technological adventures along the way, including the need to be on a phone and desktop simultaneously to use the free government service.
But people got their codes and, largely, got on with their lives.
Then came the filing windows. And that’s where things became slightly more entertaining.
There was understandable confusion around the changing periods and the 14-day window around a director’s birthday when the code had to be given back to the very people who had given it to you in the first place.
Most ACSPs use company secretarial software that works all this out for us.
Thankfully.
Because if you missed what I once cynically heard described as the:
“14-day filing period closest to the nearest blue moon to the director’s dog’s birthday”
Companies House would write to the director or PSC.
The director would then contact their accountant or ACSP, usually rather less politely:
“I paid you to do this ages ago!”
We would then explain that, yes, we had done it ages ago, but we couldn’t give the code back to the people who gave it to us until Companies House’s particular filing window opened. Nor could we necessarily do everyone in the same company at the same time.
Eventually, most people got used to it.
Meanwhile, filing fees increased again to £50 and there was, shall we say, a temporary period of “ill will” towards the lovely people at Companies House.
And now we have April 2028
Fast forward to April 2028 and another batch of changes arrives.
Note that date: April 2028.
The original timetable was working towards April 2027, but implementation has been nudged back by a year.
The headline grabber is the mandatory filing of profit and loss information.
Small companies have historically been able to keep this information away from the public record through the filing of abridged accounts.
Unsurprisingly, the proposed change has caused considerable concern around commercial sensitivity.
And I completely understand why. Do you really want your competitors and customers seeing your turnover and margins? Do you want your staff seeing the total wage bill and where the money goes?
There can, of course, be reasons why a company might positively want financial information available. A business seeking investment, for example, will invariably be asked for its full accounts once it enters a due diligence process.
But for many owner-managed businesses, publishing that information to the world is a very different proposition.
As an accountant, therefore, my first question was:
Which P&L is it?
Because there are two within statutory accounts.
There is the summary P&L and then there is the rather more interesting one marked “for the information of the directors only” — the detailed account that is largely seen only by the people the company chooses to show it to and HMRC.
The answer? It’s the biggie.
The one containing the sensitive information that was previously between you, your accountant, your God and HMRC.
Fortunately, small and micro companies will be able to opt out. Companies House publishes the definitions used to determine company size.
Which led immediately to my second question:
Is the opt-out permanent, or do we have to do it every year?
The answer is:
Yup. Every time you file.
Because the company’s size may change.
That means missing one box could potentially result in some very awkward conversations with clients when information they expected to remain private suddenly isn’t.
Remember that box. We’ll come back to it.
What else is changing?
There are several other changes, although for many companies and accountants they may be less dramatic than they initially sound.
- Mandatory commercial software and iXBRL tagging
For most accountant-filed accounts, this may not represent a massive change because the software already used for HMRC disclosure generally meets these requirements.
The number of people self-filing limited company accounts is relatively small compared with, say, Self Assessment.
What does change is that web filing and paper filing will close.
- Abridged accounts disappear
This one raised a few accountant eyebrows.
Abridged accounts are filed specifically so that commercially sensitive information, such as the P&L account, can be removed.
The new rules require full iXBRL accounts to be filed through software…
…but allow qualifying companies to opt out of filing the P&L.
Erm… are they not then abridged?
Moving swiftly on.
- Everything must be filed at the same time
All parts of the accounts and reports must be filed together. Although my immediate reaction to this one was:
Why wouldn’t you anyway?
- Audit exemption gets a stronger statement
Eligibility for audit exemption will require a “strengthened eligibility statement.”
OK then.
Presumably, for most businesses, the accounting software will provide this as part of the filing process.
- Shortening your year end becomes more restricted
The number of times an accounting year end can be shortened will be restricted, bringing it more into line with the existing restrictions around extending accounting periods.
This closes off an old accountant’s workaround, although in reality it’s something we rarely see these days.
So, how much do you actually need to worry about?
If your accountant already files your accounts using commercial software, the answer may be:
Not very much.
You are probably already complying with most of the practical requirements.
The big discussion will be whether your company qualifies to opt out of publishing the detailed P&L and, if it does, making sure that decision is correctly reflected every single time you file.
If you’re still filing through Companies House web filing or using paper accounts, you have rather more work ahead of you because those routes are disappearing.
There is also an interesting point around timing.
At a recent in-person Companies House seminar, my understanding was that the 1 April 2028 implementation date applies to filings made from that date.
So, if you have a January or February year end and can file your accounts before 31 March 2028, you may effectively buy yourself another year before the new filing requirements apply.
Companies with year ends between July 2027 and February 2028 could potentially meet that earlier filing deadline for one more year.
If your year end is 31 March 2028, however, unless you’re capable of some fairly heroic same-day accounting and filing, you’re probably going to be operating under the new rules.
So despite all the headlines, for businesses whose accountants already use commercial filing software, much of April 2028 may turn out to be considerably less dramatic than it first appears.
There will be some changes.
There will undoubtedly be some confusion.
There will almost certainly be a few conversations with Companies House.
But for many small and micro companies, there may ultimately be one particularly important piece of compliance advice:
Just remember to tick the damn box!!!”
-Joanne Nock
