FRS 105 Micro Entity Accounts in Burton On Trent

FRS 105 is the UK financial reporting standard for micro-entities. It is a simplified framework that allows qualifying companies to prepare shorter, less detailed financial statements than they would under a larger reporting standard, with a reduced set of notes. It sits alongside the micro-entities regime: a company needs to qualify for that regime and then choose to apply it, and FRS 105 is the standard used when that choice is made.

FRS 105 is available to companies that meet the micro-entity size conditions and choose to apply the micro-entities regime. For accounting periods beginning on or after 6 April 2025, a company generally needs to meet at least 2 of 3 applicable conditions: turnover of no more than £1 million, a balance sheet total of no more than £500,000, and an average of no more than 10 employees. Other rules and exclusions can also affect eligibility, so meeting the size conditions on their own does not automatically mean a company qualifies — it is worth checking the position for your own company rather than assuming.

No. The micro-entities regime is an available accounting regime rather than a mandatory one. A company that qualifies may still prepare its accounts under a different framework, such as FRS 102, if that better suits its circumstances or the way it wants its figures presented. FRS 105 applies when the micro-entities regime is the chosen basis for the accounts.

Both are UK accounting frameworks, but they are aimed at different sizes of company. FRS 105 is designed for micro-entities and is deliberately pared back, with fewer disclosures and simpler measurement requirements. FRS 102 is a fuller framework used by a much wider range of companies, including small and medium-sized entities and larger businesses, and it generally involves more detailed accounting treatment and more extensive disclosure. The framework applied affects how figures are measured and what is shown in the notes.

Companies that are required to file annual accounts will normally file their financial statements at Companies House, and that can include accounts prepared under FRS 105 where the micro-entities regime applies. The accounts filing obligation is separate from your Corporation Tax obligations and from your Confirmation Statement. Filing requirements depend on your company's own position, so it is best to confirm what applies to you rather than relying on a general rule of thumb.

Yes — they are different documents serving different purposes. FRS 105 accounts are the company's financial statements, prepared for the company and filed at Companies House where required. The CT600 is the Corporation Tax Return submitted to HMRC, which reports the company's taxable profits and allowances for the period. The accounts usually provide the starting point for the tax computation, but the tax return itself is a distinct filing with its own deadlines and its own basis of calculation.

A new company can potentially use FRS 105 for its first accounting period if it meets the micro-entity size conditions and chooses to apply the micro-entities regime. Practically, first-year accounts can raise questions around the first accounting reference date, start-up costs and how a short or long first period is treated, so it is sensible to get advice early rather than leaving it until shortly before the accounts are due. Many small trading companies in Burton On Trent start out comfortably within the micro-entity limits.

Typically we need your accounting records for the period — sales and purchase information, bank and cash statements, payroll details where you employ people, details of asset purchases and disposals, loan and director's loan account movements, stock or work in progress figures if relevant, and any information about accruals, prepayments or items that span more than one period. If your records are already in accounting software, giving us access can make the process smoother. Details of the prior year accounts and the company's registration information are also useful.

Yes — the UK company size thresholds and the micro-entity conditions have been updated, and for accounting periods beginning on or after 6 April 2025 the relevant limits are turnover of no more than £1 million, a balance sheet total of no more than £500,000 and an average of no more than 10 employees, with at least 2 of the 3 applicable conditions generally needing to be met. There are also ongoing developments in how accounts are filed at Companies House, moving towards digital filing of accounts and, in time, tagging of financial information. Because the position depends on your accounting period and your company's circumstances, it is worth checking rather than relying on limits you may have seen previously.