Update on Profit and Loss filing reforms for small companies

The government has delayed the planned requirement for small companies to file Profit & Loss (P&L) accounts at Companies House, originally expected to apply from April 2027.

A key factor behind the reason to delay is the commitment to provide at least 21 months’ notice before implementing any changes.

This gives businesses more time to plan, but how much longer remains uncertain with the update stating “the reforms are still under review and a final decision will be announced shortly”.

This could be welcome news for businesses, with the earliest implementation date now pushed back to late 2027.

While there is speculation that the reforms will be scaled back to reduce the increasing requirements small businesses face under the Economic Crime & Corporate Transparency Act. We recommend that you speak to your accountant to understand:

• If the accounts reform goes ahead, what impact is it likely to have on differing stakeholders? And how can this be mitigated?
• If the P&L is shown, comparatives will also be shown, therefore when do we need to really understand what presentation options there are?
• What other disclosure changes are coming in the next couple of years, and how can I understand how these will interact with the accounts reform?
• If I change from my remuneration method of salary & dividend,s what are the tax and accounting disclosure impacts of these?

It’s key to note whether the changes to P&L filing come into place; they are not the only changes impacting small and micro entities. It’s important that you are always looking forward with your accountant and making decisions with a financial and commercial focus.

For more information, please email Simon Kendall here.