Accounts & filing
Most small UK companies are exempt from audit. Here are the thresholds, the situations that remove the exemption, and what an audit actually costs and involves.
Written and reviewed by Waqas Sagar Member of ICAEW, Fellow of ACCA, Fellow of AAT, a double graduate and entrepreneur at heart, helping startups grow and serving thousands of businesses nationwide with an excellent team. Published by LimitedCompany.Accountants, 12 London Road, Morden, London SM4 5BQ. Reviewed 12 September 2026 against 2026/27 UK rates and current Companies House and HMRC guidance.
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QuickBooks PartnerCertified ProAdvisor100+ yearsCombined team experienceFully insuredUp to £2m indemnityMost small companies are exempt. You generally need an audit only if you exceed two of three thresholds on turnover, balance sheet total and employees, are part of an ineligible group, are in a regulated sector, or shareholders holding 10% demand one.
When the exemption disappears
Living with an audit
Most small companies are exempt. You generally need an audit only if you exceed two of three thresholds on turnover, balance sheet total and employees, are part of an ineligible group, are in a regulated sector, or shareholders holding 10% demand one.
Exceeding the size limits for two consecutive years is the usual trigger, applied at group level where the company is part of a group. Financial services firms, insurance intermediaries and certain regulated entities are audited regardless of size.
Shareholders holding at least 10% of the nominal share capital, or 10% of a class, can require an audit by written notice. Articles, shareholder agreements, investor terms and grant conditions can also impose one contractually even where the law does not.
An audit tests evidence rather than preparing the numbers, so it needs a clean, closed set of records, supporting documentation, stock counts and confirmations. Companies that keep tidy monthly records find it manageable; those that reconcile once a year find it painful and expensive.
If you expect to cross the threshold, start behaving like an audited company a year early: monthly reconciliations, documented revenue recognition and a proper fixed asset register. The first audit is priced on how much work it takes to get comfortable.
Rates, thresholds and deadlines quoted here reflect the 2026/27 UK position and current Companies House and HMRC guidance. Check GOV.UK, or ask us, before relying on them for your own company.
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We work with company directors across London and Surrey from our office at 12 London Road, Morden, London SM4 5BQ. Pick your area, or send the form below and we will call you back.
Frequently asked
Yes. Some companies choose one for lenders, investors or an upcoming sale, even when exempt.
It is not a tax clearance, but audited accounts are harder to challenge and tend to reflect better record keeping.
We prepare companies for audit and work alongside registered auditors. Audit work itself is carried out by a registered audit firm.
Keep bank statements, sales and platform reports, purchase invoices, payroll records, VAT workings, finance agreements and Companies House correspondence. We confirm the exact list at onboarding and identify gaps before a filing deadline becomes urgent.
The fee depends on transaction volume, record quality, VAT and payroll requirements, historic catch-up and the level of reporting needed. We agree a fixed scope and price before technical work starts, with published packages available on our fees page.
Yes. We request professional clearance, collect the prior records and authorities, check the next Companies House and HMRC deadlines, and give you one clear handover list. The process is normally completed remotely.
Yes. We work through secure cloud records, scheduled reviews and digital approvals, while keeping a named team available by phone, video call and email. Clients can also visit our Morden office by appointment.
We regularly work with Xero, QuickBooks, FreeAgent, Sage and connected sales or expense apps. The right setup depends on transaction volume, integrations and the reports you need, not simply the software brand.
The relevant calendar may include annual accounts, Corporation Tax payment and return dates, confirmation statements, VAT returns, payroll submissions and Self Assessment. We map the dates from your company year end and registrations.
No. This page explains general UK rules and common accounting treatment. Your facts, contracts and wider tax position must be reviewed before you rely on a conclusion.
Included approach
Check the current rules
Deadlines, thresholds and filing rules change. GOV.UK and Companies House publish the current statutory position; advice should then be applied to your company’s circumstances.
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Pick a time that suits you and a qualified accountant will call you about your company, deadlines and fees.
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