Micro-entity and small-company status changes the accounts workflow—not the need to check eligibility.
For financial years beginning on or after 6 April 2025, updated size thresholds apply. The company must normally satisfy at least two tests and consider exclusions.
Current micro-entity thresholds
GOV.UK says a company is a micro-entity if it meets at least two of these conditions: turnover of £1 million or less, a balance-sheet total of £500,000 or less, and ten employees or fewer. The applicable period and eligibility rules still need to be checked.
Current small-company thresholds
For financial years beginning on or after 6 April 2025, the small-company and audit-exemption size figures include turnover no more than £15 million, balance-sheet assets no more than £7.5 million, and an average of no more than 50 employees. Meeting two size tests does not override statutory exclusions.
Do not decide from turnover alone
The classification review should record:
- The financial year to which the thresholds apply
- Turnover, balance-sheet total and average employees
- The prior-year position and any first-year rules
- Group membership and applicable group tests
- Whether the company falls within an excluded category
- Whether shareholders require an audit
Preparation and filing choices are distinct
A micro-entity may prepare simpler statutory accounts. A qualifying small company may have filing options and may be audit exempt. The accounts prepared for members, HMRC and Companies House can have different presentation requirements, so the workflow should identify each output rather than treating “small accounts” as one generic document.
Future filing rules are changing
Companies House has announced that all accounts filings made on or after 1 April 2028 will use commercial software and iXBRL. It has also announced changes to the information filed by small companies and micro-entities. Check implementation guidance for the filing date concerned.
Where professional judgement is needed
This guide explains a filing workflow, not the accounting treatment, tax position or legal duties of a particular company. Confirm the applicable accounting framework, reliefs, disclosures and filing obligations against current official guidance and, where needed, a qualified accountant or tax adviser.
FAQ
What are the current micro-entity size figures?
The headline tests are turnover up to £1 million, balance-sheet total up to £500,000, and ten employees or fewer, with at least two normally required.
What are the current small-company size figures?
For financial years beginning on or after 6 April 2025, the headline tests are turnover up to £15 million, balance-sheet assets up to £7.5 million, and 50 employees or fewer, with at least two normally required.
Is every small company audit exempt?
No. The size test is not the whole eligibility test; exclusions, group circumstances and shareholder requirements can apply.
Can a dormant company ignore annual accounts?
No. A dormant limited company generally still files annual accounts and a confirmation statement with Companies House.
Official sources
Checked on 2026-08-11. Official guidance takes priority if rules change.
- Micro-entities, small and dormant companiesCompanies House
- Audit exemption for private limited companiesCompanies House
- Changes to accounts filingCompanies House
- Dormant for Companies HouseCompanies House