FRS 105 Micro Entity Accounts in Colden Common

FRS 105 is the UK financial reporting standard for micro-entities. It sets out how the smallest qualifying companies prepare their financial statements when they choose to apply the micro-entities regime, including how the balance sheet and profit and loss account are presented and what disclosures are required. It is deliberately simpler than frameworks such as FRS 102, which is designed for a much wider range of companies. In short, it is the accounting framework that sits behind FRS 105 Micro Entity Accounts.

FRS 105 is available to companies that qualify as micro-entities and choose to apply the micro-entities regime. Qualifying generally involves meeting at least two of three size conditions covering turnover, balance sheet total and average employee numbers, while also staying within the other eligibility rules and exclusions that apply. Because those rules depend on the individual company, it is worth checking before assuming FRS 105 applies. Companies that do not qualify, or that prefer a fuller framework, prepare accounts under something else, most commonly FRS 102.

No. Qualifying for the micro-entities regime does not force a company to use it. A company that meets the criteria can choose to apply the regime and prepare FRS 105 accounts, or it can prepare accounts under a different framework such as FRS 102. Some directors prefer the additional disclosure a fuller framework provides, for example where lenders, investors or group companies want more detail. Others value the simpler presentation FRS 105 allows. The choice should be made with your circumstances in mind rather than by default.

For accounting periods beginning on or after 6 April 2025, a company generally needs to meet at least 2 of 3 applicable size 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. Meeting those size tests is not the whole story, because other eligibility rules and exclusions can apply and some companies cannot use the regime regardless of size. We look at the tests and the wider rules together before confirming whether FRS 105 is available to a particular company.

Both are UK financial reporting standards, but they are aimed at different sizes of company and produce different accounts. FRS 105 is written for micro-entities and keeps things as simple as the law allows, with lighter disclosure requirements and a more restricted set of accounting options. FRS 102 is a broader framework used by small and larger entities, and it requires more disclosures and more detailed accounting treatment in a number of areas. The framework you use affects how the accounts look and what they include, which is why the choice between FRS 105 and FRS 102 matters.

Yes. A limited company has to deliver accounts to Companies House each year, and if it has prepared them under FRS 105, those are the accounts in question. What actually gets filed depends on the company's circumstances and the filing rules in force, and filing requirements for small and micro-entity companies have been changing. For accounting periods beginning on or after 6 April 2025, companies are generally expected to file more information than the limited versions previously allowed, and submission is moving towards software-based filing. It is worth checking current Companies House guidance or asking us what applies to your year.

Yes, they are two different things going to two different places. Your FRS 105 Micro Entity Accounts are the financial statements prepared for the company and its shareholders and delivered to Companies House. A CT600 is the Corporation Tax Return submitted to HMRC, which works out the tax due on the company's taxable profits. The two are related, since the accounts usually form the starting point for the tax computation, but profit in the accounts is not automatically the same as taxable profit — items such as depreciation and capital allowances are treated differently. Filing one does not satisfy the other.

Typically we ask for your accounting records for the period: bank and credit card statements, sales invoices or summaries, purchase and expense records, payroll information, details of any assets bought or sold, loan and lease agreements, and the previous year's accounts where available. If you use accounting software, we can often work from that directly. We will also want to know about anything unusual that happened during the year, such as a change in ownership, a new loan or a significant one-off cost, because those can affect how the accounts are prepared. The more complete the records, the smoother the process.