Micro-Entity Accounts Requirements: What You Must File in 2026

For accounting periods starting on or after 6 April 2025, a company qualifies as a micro-entity if it meets at least two of these three thresholds: turnover of £1 million or less, a balance sheet total (fixed assets plus current assets) of £500,000 or less, and an average of 10 or fewer employees during the year.

These figures replaced the previous, lower thresholds and apply from the first accounting period starting on or after that date, so check which period your accounts cover before assuming the new limits apply.

For comparison, the small company thresholds (which apply if you exceed micro but stay within small) are turnover of £15 million or less, a balance sheet total of £7.5 million or less, and 50 or fewer employees, again meeting at least two of three.

A company does not flip in and out of micro-entity status based on a single year's figures. After its first financial year, a company must generally meet the thresholds for two consecutive years to newly qualify as a micro-entity, or to be treated as no longer qualifying if it exceeds them.

In practice this smooths out one-off fluctuations, such as a single unusually large contract, so a business does not lose or gain simplified reporting purely because of one atypical year.

A qualifying micro-entity can prepare and file a simplified balance sheet with only the notes required by the micro-entity provisions, using the FRS 105 accounting standard rather than full FRS 102. Under the current rules, the profit and loss account does not have to be filed publicly at Companies House, even though it must still be prepared for HMRC and shareholders.

Micro-entity accounts must also carry specific statements below the balance sheet, including confirmation that the accounts are prepared in accordance with the micro-entity provisions and the relevant audit exemption statement, together with the directors' signature.

See our line-by-line guide to the micro-entity balance sheet (micro-entity-accounts-example) for what each heading actually means and what has to sit beneath it.

Micro-entity status simplifies content, not timing. Private company accounts are still due at Companies House 9 months after the accounting reference date, or 21 months after incorporation for a first set of accounts covering more than 12 months.

A Company Tax Return (CT600) is still due at HMRC 12 months after the end of the accounting period, and any corporation tax owed is still due 9 months and 1 day after the year end, well before the CT600 filing deadline itself.

Being a micro-entity does not reduce the late filing penalty if accounts are filed after the deadline. For a private company the penalty is £150 if accounts are up to 1 month late, £375 for 1 to 3 months, £750 for 3 to 6 months, and £1,500 for more than 6 months, and the penalty doubles if accounts were also filed late the previous year.

These penalties are automatic and are charged on the company, not the director personally, but persistent late filing is also a common trigger for Companies House to consider striking a company off the register.

Companies House has said that, as part of the wider Economic Crime and Corporate Transparency Act reforms, small and micro-entities will in future need to file a profit and loss account, abridged accounts will be removed as an option, and accounts will eventually need to be filed only through software rather than the current web-based or paper routes.

Read our fuller breakdown of the timetable and what to prepare for (companies-house-changes), since the direction of travel is towards more transparency, not less, even for the smallest companies.

Separately from the accounts changes, Companies House introduced identity verification for directors and people with significant control from 18 November 2025. This applies whatever size band a company falls into, and unverified directors can eventually be blocked from filing on the company's behalf.

We prepare and file micro-entity accounts under FRS 105 for owner-managed companies (micro-entity-accounts).

If you're comparing what a set of accounts actually costs to have prepared, see our accountant fees guide (limited-company-accountant-fees) or current pricing (fees).

We are an independent firm of Chartered Accountants, not Companies House or HMRC.

Rates, thresholds and deadlines quoted here reflect the 2026/27 UK tax year. Check current GOV.UK guidance, or ask us, before relying on them for your own company.