Businesses must submit their annual accounts to Companies House each year, where they may finally share their struggles, successes, and goals with the public. The yearly reports are like an antique scroll that gradually reveals its secrets, laying out the companyโs income, expenses, profits, and investments like a map. Submitting annual accounts is crucial to a companyโs compliance, showcasing its financial health and performance over the past year.
The annual accounts filed with Companies House hold the key to opening doors, luring in financiers, and connecting with potential allies near and far. Reporting the value of company assets in the balance sheet is essential for accurately depicting the financial position of the business. Take it as a chance to write about your journey and show your strength and determination. These financial statements tell the tale of your companyโs successes and failures over the last year.ย
In this article, weโll delve into essential information you need to be familiar with before submitting your annual accounts. Weโll explore various types of annual accounts, the specific timeframe for filing them, and the significance of the accounting reference date. Additionally, common queries about these accounts will be addressed.ย
What are Annual Accounts?
UK limited liability firms must submit their financial statements to Companies House Accounts and the UK tax authorities annually. Annual accounts, also known as year-end accounts, detail the financial transactions and outcomes of a companyโs preceding fiscal year, thus the alternative names โannual accountsโ and โstatutory accounts.โ
Limited companies typically have a 12-month financial year that concludes on the โaccounting reference dateโ (ARD), often the companyโs anniversary of incorporation. The UK government imposes Corporation Tax on companies based on their taxable earnings, calculated using their annual accounts. The annual report and accounts provide a comprehensive overview of the companyโs financial performance over the last year.
Preparing annual accounts is to give an accurate and fair view of the companyโs financial position, performance, and cash flows for the year. An annual accounts example would include a profit and loss statement, balance sheet, and notes on the financial statements. In other words, it allows shareholders and other interested parties to assess how well the company has performed financially over the year.
WHAT ARE THE TYPES OF LIMITED COMPANY ACCOUNTS?
There are different types of limited company accounts, and it is crucial to understand each one to ensure you file the correct accounts with Companies House.ย These accounts include:
- A profit and loss account: A profit and loss account shows the company’s revenue, expenses, and overall profitability during the financial year. Company sales and revenue figures are vital to the profit and loss account, illustrating the business’s financial health.
- A balance sheet
- Notes about the accounts: The notes about accounts provide additional context and explanations for the figures in the financial statements.
- A directorsโ report: The director’s report provides an overview of the company’s operations, significant changes, and financial performance.
- An auditorsโ report (unless the company qualifies for exemption): The auditor’s report independently assesses the financial statements’ accuracy and compliance.
- Name and signature of the company director
There are different types of limited companies, including a limited liability partnership, a public, and a private limited company.
Small Company Accounts:
Small limited companies must submit small company financial statements to Companies House annually unless they fulfil two of the specified criteria for two consecutive years. In such cases, they will be reclassified as medium-sized companies. They must submit comprehensive annual reports and audited financial statements instead of the abbreviated ones previously required for small companies.
- Annual turnover not greater than ยฃ10.2m
- Balance sheet total not greater than ยฃ5.1million
- Number of employees fewer than 50
Explore More About LLP, Limited Companies and Director’s Responsibilities In Limited Companyย
Micro Entity Accounts:
This type is only available to micro-businesses, i.e., those that meet at least two out of three qualifying conditions listed:
- Annual turnover not greater than ยฃ632,000ย
- Balance sheet total not greater than ยฃ316,000
- Number of employees fewer than 10
Medium-Sized Company Accounts:
Most companies that do not meet the criteria for a small company or micro-entity account must file medium-sized company annual accounts. The main difference between medium and large company accounts is that medium companies must disclose their directorsโ remuneration in the notes to their financial statements. To be medium-sized, your company must have the following:
- An annual turnover of no more than ยฃ36 million
- A balance sheet total of no more than ยฃ18 million
- An average number of employees of no more than 250
Large Company Accounts:
Companies with an annual turnover greater than ยฃ36 million, a balance sheet total greater than ยฃ18 million, and 250 employees or more must file large company accounts. These accounts are much more detailed and must be audited by an external auditor.
Dormant Company Accounts:
If your company has been inactive for the past 12 months (i.e., it has not carried out any business transactions), then you must file dormant company accounts instead of annual returns.
How to File Accounts With Companies House?ย
Step 1: Pick the Correct Type of Business
How do you file company accounts? Choose the appropriate form to submit your annual accounts. The size and nature of your company will determine the conditions you must fill out. Choose the proper business structure.ย
Depending on your situation, you may need to fill out one of these forms:
Micro-entity accounts: This is for establishments with yearly revenue of up to ยฃ632,000.
Small Business Accounts: A companyโs annual revenue must be no more than ยฃ10.2 million, and its total assets may not exceed ยฃ5 million to qualify for accounts for a small company.
Medium Company Accounts: These are for businesses with ยฃ36M in revenue and ยฃ18M in assets.
Large Company Accounts: These have revenue of ยฃ36 million or more and assets of ยฃ18 million or more.
Step 2: Learn the Filing Dates
Knowing your firmโs filing dates is crucial before completing the annual accounts. Typically, private limited corporations have nine months from the end of their financial period to submit their annual reports.ย
If your companyโs financial year finishes on December 31st, youโll have until September 30th to raise your annual reports. The penalty for late submission rises with each passing day.
Step 3: Decide on the Annual Report Format
Company annual accounts must be filed in accordance with the business size and structure, which will determine the level of detail required. You may submit either an abridged set of financials or a complete set for a small business. Full reports consist of the balance sheet and comments on the accounts; the abbreviated accounts are a condensed version of the total accounts. Small companies may submit abridged accounts, which provide a simplified version of the full financial statements required by Companies House.
Companies are small if they have less than 50 workers, annual revenue less than ยฃ10.2 million, and assets less than ยฃ5.1 million. Profit and loss statements, balance sheets, cash flow statements, and notes on the accounts are all components of a complete set of financial statements. Significant corporations must provide full financials.
Therefore, choosing the appropriate form is the first step in filing your annual accounts. Depending on the nature and scale of your company, you may be required to fill out a specific form.ย
Step 4: Get Ready for Tax Time
Once you know what kind of financial statements you must provide, you may begin working on your yearly financial statements. If your firm is publicly traded, you must draw your annual reports in line with either UK GAAP or IFRS (International Financial Reporting Standards). Most private companies in the UK prepare their financial statements according to UK Generally Accepted Accounting Practices (UK GAAP).
Itโs also essential to keep your accounting records in order and follow the rules of Companies House file accounts.
Step 5: File Your Companyโs Annual Accounts with Companies House
You may file your yearly accounts with Companies House electronically or by mail. Filing electronically is preferred because it saves time and money. However, online filing requires registering your limited company with Companies House and submitting a Companies House confirmation statement.ย
You can then send your yearly accounts electronically to Companies House. When submitting your annual accounts, you must ensure that your Companies House financial statements meet the necessary guidelines. You may pay the filing fee with a debit or credit card or transfer money from your bank account. For micro-entities, an annual accounts template can provide a simplified structure for reporting financial data. Prices for filing annual reports are different for different types of financial statements. In addition to filing annual accounts, companies may also need to submit an annual VAT return if they are registered for VAT. A yearly VAT return summarises the VAT paid and collected during the financial year and must be submitted along with the annual accounts if applicable. Modern businesses rely heavily on tools like a business password manager to ensure secure and efficient operations, especially when handling sensitive financial data.ย
You can get the necessary paperwork from the Companies House website if you submit your annual accounts through snail mail. After completing the form, please include a copy of your companyโs annual accounts and submit them to Companies House. The Companies House website will provide the mailing address to which you can submit your yearly accounts. Allow plenty of time for Companies House to receive and process your annual reports before the filing date.
Step 6: Check Your Filing Confirmationย
You should get a confirmation of filing after youโve sent in your annual accounts to Companies House. If you want to be sure your yearly reports were adequately submitted and approved, check this confirmation. It would be best to contact Companies House immediately to fix any mistakes or omissions.
Ensure your business complies with the law and avoids penalties or legal action by familiarising yourself with the filing dates, selecting the appropriate form of accounts, drafting your yearly statements, sending them to Companies House, and verifying your filing confirmation.ย
WHO CAN FILE ANNUAL ACCOUNTS?
All companies registered in the UK must prepare and file annual accounts with Companies House. This includes both private and public companies, as well as limited liability partnerships (LLPs). This rule has certain exceptions, such as dormant companies and charities.ย
The quickest and easiest way to file your accounts is online.ย
You can follow the online instructions or watch our โHow toโ videos on YouTube to see how itโs done. To file online, you will need the following:
- register by providing your email address and choosing a password
- have the companyโs authentication code on hand
The online service has built-in checks to ensure all the necessary information is entered before submitting. Youโll be emailed automatically when your accounts have been received and again to tell you whether they have been accepted.
THE TIME FRAME OF ANNUAL ACCOUNTS AND HMRC
You must send your first annual accounts to Companies House within 21 months of incorporation. Usually, these cover a period of just over 12 months. The accounting reference date is normally the anniversary of the last day of the month of company formation.
Normally, you should deliver annual accounts to Companies House within 9 months after the end of the accounting year. You must include full annual accounts for HMRC with each Company Tax Return. HMRC annual accounts must be filed alongside the Company Tax Return, detailing the financial activities for the fiscal year.
Accounting Reference Date (ARD)
The accounting reference date (ARD) marks the end of an organisationโs financial year and the date for preparing annual accounts. Itโs crucial as it sets deadlines for Company House and HM Revenue and Customs.
When you establish your company, Companies House designates the ARD as the anniversary of your incorporation. Each year, your accounting period concludes on that day, and you must submit annual accounts to Companies House within nine months afterwards.
After forming your company, the financial year commences on the incorporation day. The first ARD is then set exactly one year later, on the last day of the month of incorporation. This date remains the ARD each subsequent year. For example, if you registered on July 6, 2019, your first ARD is July 31, 2020, and July 31 every year. Company accounts are due 21 months after registration with Companies House (first financial year plus nine months).
Failing to submit your report on time incurs a penalty, with the amount varying based on the delay. For a delay of up to one month, the penalty is ยฃ150. However, exceeding six months after the deadline increases the penalty to ยฃ1,500.
| Action | Deadline |
| File first accounts with Companies House | 21 months after registering with Companies House |
| File annual accounts | Nine months after the end of your companyโs financial year |
| Pay corporation tax (or tell HMRC you donโt owe any) | Nine months and one day after the end of your companyโs accounting period for corporation tax |
| File company tax return | 12 months after the end of your companyโs accounting period for corporation tax |
Changing your accounting reference date is possible, but you must get written consent from HMRC. You can apply to change your ARD online.
IS IT POSSIBLE TO PREPARE MY OWN COMPANY ACCOUNTS?
While hiring an accountant to prepare your annual accounts is not obligatory, it can be highly beneficial if you wish to avoid the complexities of doing it yourself. If you’re wondering how to prepare company accounts, it’s essential to follow the specific format required by Companies House.
Proper accounts preparation ensures that all financial statements are accurate and compliant with regulatory requirements. Additionally, you must provide details about any debts owed by directors and shareholders due to loans made to the company, along with information about share capital.
Transparency about company debts in the annual accounts is crucial for shareholders and potential investors. Proper accounting standards are essential to ensure that the financial statements accurately reflect the company’s performance. Accuracy is vital because failure to disclose this information may result in penalties and potential criminal liability for fraud. The companyโs general meetings are a valuable opportunity to discuss financial performance and seek approval for the annual accounts.
Accountants possess expertise in this domain, making selecting a professional with ample experience and requesting references prudent. Ultimately, hiring a limited company accountant is essential as they can recommend the most suitable annual return filing procedure for your business.
DO I NEED AN ACCOUNTANT TO PREPARE MY ANNUAL ACCOUNTS?
It is advisable to seek professional assistance when preparing your annual accounts, even if you are not legally obliged. This is because some specific rules and regulations must be followed when compiling company accounts, and an accountant will have the knowledge and experience to ensure these are adhered to. Failing to prepare accurate annual accounts could result in Companies House or HMRC penalties.
A few of the reasons are as follows:
Skill and Understanding:ย
Consulting a tax adviser can be beneficial for navigating complex tax laws and optimizing your company’s tax strategy. You need to hire a professional accountant if you want your yearly accounts to be correct and in line with UK accounting regulations. They can help you make sense of complicated accounting challenges and get your financial reports in on time.
Time-saving:ย
If you are unfamiliar with the procedure or have a particularly complicated financial position, preparing and filing yearly accounts may be a significant time commitment. Hiring an accountant may help you save time and energy that you can use to grow your company.
Errors are Less Likely to Occur:ย
Accurate and complete financial records are essential for successful business operations, and professional accountants are trained to spot problems and rectify them. It may lessen the likelihood of missing information that might cause a fine from Companies House.
Tax Preparation and Guidance:ย
Expert tax planning and guidance from an accountant can help reduce your tax burden and make the most of additional tax advantages and incentives.
Guaranteed Representation During Audits:ย
A competent accountant may act as your advocate during an audit or inquiry by Companies House, protecting your best interests and speeding up the resolution process.
WHAT IS THE DIFFERENCE BETWEEN ANNUAL ACCOUNTS AND ANNUAL CONFIRMATION STATEMENTS?
While both documents pertain to a companyโs financial year, they differ significantly. Annual accounts must adhere to the Companies Act, encompassing comprehensive financial statements. On the other hand, annual confirmation statements only demand directors to verify specific information (such as the companyโs registered name, type, and address) for accuracy.
HOW DO YOU CREATE YOUR COMPANY HOUSE ACCOUNTS?
If you decide to prepare your company accounts, they must be compiled in accordance with the format prescribed by Companies House. Using a company accounts template can simplify the process of preparing your financial statements for submission to Companies House. This usually means using software such as Sage, Xero, or QuickBooks to automatically produce accounts in the required form. If you do not have access to these top cloud accounting software, you can use HMRCโs free online accounting service โ Simple Completion โ to help you complete and submit your company accounts.
Can We Use Third-Party Software to File Our Annual Report?
Yes, annual accounts may be filed with Companies House in the United Kingdom utilising a third-party program. Various programs facilitate the generation and submission of annual reports to Companies House on behalf of firms.
Using third-party software to submit your yearly accounts has several advantages to doing it manually. These include automatic data input, error checking, and real-time submission progress notifications. You may further simplify your accounting procedures and lessen the likelihood of human mistakes by turning to third-party software.
The final responsibility for the correctness and completeness of your yearly accounts remains with you, even if you opt to submit them using third-party software. Before submitting your companyโs financial records to Companies House, double-check their accuracy using a trusted software system.
Can We Submit Annual Accounts to HMRC?
The UKโs HMRC is not a valid substitute for Companies House when filing annual accounts. Companies House and Her Majestyโs Revenue and Customs (HMRC) are independent government agencies with roles and duties.
Companies and other legal entities in the United Kingdom are registered and governed by Companies House. One of its primary roles is to collect and organise data on businesses and make that data accessible to the general public. You must file annual accounts and other statutory papers with Companies House and make them accessible to the public. In contrast, the UKโs tax collection and enforcement is under the purview of HMRC. Businesses must file tax returns with HMRC and pay the associated taxes on their earnings.
Both Companies House and HMRC require financial information from businesses, but itโs important to note that the data they request and how they utilise it are separate and unique. HMRC compels companies to file tax returns and pay taxes based on revenue and earnings. In contrast, Companies House mandates businesses to publish yearly accounts to guarantee openness and responsibility.
HOW DO I SUBMIT AMENDED ACCOUNTS TO COMPANIES HOUSE?
If you have made an error with your annual accounts, submitting amended accounts to Companies House is possible. You can send the amended document through the following:
- The companyโs online filing account
- on paper by post
If you are sending amended accounts on paper, you must clearly state in your new accounts that they replace the original accounts. These new statutory accounts must be prepared as they were at the date of the original accounts.
Write โamendedโ on the front of your accounts so that Companies House knows your accounts are not duplicates. Your original accounts will remain on file at Companies House.
If you only want to amend one part of your accounts, you need to send a note saying whatโs been changed. The note must be signed by a director and filed with a copy of the original account.
How do you send revised annual accounts to Companies House?
Companies House has simplified submitting amended financial statements in the UK. Here is a step-by-step guide for your assistance:
Make Sure You Have the Right Accountsย
Make sure you have the updated financials that reflect the changes. In some instances, this may necessitate revising the previously supplied accounting data.
Make the Updated Statements of Accountsย
Take a look at the first books and update them if necessary. Revising the submission to fix inaccuracies, update numerical data, or add missing or erroneous details may be required. Verify the updated financial statements are complete, correct, and aligned with all applicable requirements and guidelines.
Get Your Paperwork in Orderย
In addition to the updated financial statements, you may also need to provide other paperwork. Ensure you have reports from the board of directors, audit reports (if any), and any additional disclosures or statements that may be relevant.
Go to the Companies House pageย
To access your Companies House account, go to the webpage and sign up for an account if you donโt already have one. You may use this account to submit forms electronically.
Find the Appropriate Filing Divisionย
After signing in, go to the accounts-reporting subpage. You can find it under a section labelled โFile company informationโ or something similar. To continue with the submission, please follow the on-screen instructions.
Fill Out the Electronic Formย
You may need to provide updated information for your accounts through an online form. Select the appropriate accounting period, upload the updated accounts file, and give other details or explanations.
Details to Check and Confirmย
Ensure all the data youโve entered is correct before hitting the submit button. Verify that the updated financial statements youโve supplied are accurate and that all necessary documentation is uploaded.
Send in the Updated Accountsย
After double-checking everything, you may enter the updated financials into the online system. Companies House will review your application when theyโve received it.
Make Notesย
Preserving updated financial statement records and other relevant paperwork is crucial. It will serve as proof of your adjustments and assist in keeping proper financial records.
What Are Companiesโ House Filing Deadlines?
Companies House can efficiently determine a businessโs year-end accounts when incorporated. The day you registered your company is now the monthโs final day. Except for the first year, the deadline for filing a financial statement is nine months following the end of the accounting period.
Does Companies House Need Original Signed Accounts?
Companies House does not need original, signed accounts in the United Kingdom. Companies House now only requires yearly reports to be submitted digitally rather than physically.
A copy of your annual accounts in the proper format and any needed attachments and disclosures must be uploaded when filing annual accounts online. Additionally, they that you detail essential aspects of your business, like its name, registration number, and accounting period.
Upon submitting your annual accounts and completing the online form, Companies House will confirm receipt of your documents with an acknowledgement email. You will get a reference number so that you can monitor the development of your proposal.
Frequently Asked Questions
Who in the UK Is Required To Submit Yearly Accounts?
All legally recognised businesses in the UK, including limited liability companies and public companies, are required to submit yearly financial reports to Companies House. This legal obligation is essential to guarantee transparency, accountability, and adherence to financial reporting requirements.
What is the Yearly Account Filing Deadline?
Depending on the type of firm, different deadlines apply for filing annual accounts. While public corporations must file within six months, private limited firms often have nine months from the end of the fiscal year to do so.
The Annual Accounts Contain What Information?
Annual accounts include a balance sheet, profit and loss statement, notes on the financial statements, and a directorโs report detailing the companyโs performance and financial status.
Can I Submit My Annual Accounts Online?
Yes, yearly accounts can be filed electronically through Companies House. In the UK, most businesses must submit their financial reports electronically. Most companies can use the user-friendly online filing system, which streamlines and expedites the process of submitting financial data.
What Are the Consequences of Filing Late or Non-Filing Annual Accounts?
Companies House may impose penalties and fines if annual accounts are not submitted on time. The companyโs reputation and credit rating may also suffer from late submission. Complying with the filing dates is imperative to avoid any legal implications.
CONCLUSION
Filing annual accounts with Companies House is a legal obligation for all limited companies in the UK, but seeking professional assistance is advisable. Ensure you understand the precise rules and regulations for preparing your company accounts. Failing to file the annual accounts return on time can result in penalties and legal issues. Opt for an experienced accountant to guarantee compliance. If you need to modify your annual accounts, Companies House offers various methods for doing so. If you have any inquiries about filing annual accounts or need guidance in selecting an accountant, feel free to contact us. Our team is eager to assist you.
