FRS 105 Micro Entity Accounts in Dungannon

FRS 105 is the UK financial reporting standard that applies to the micro-entities regime. It is a simplified accounting framework available to companies that qualify as micro-entities and choose to use it. Compared with fuller frameworks such as FRS 102, FRS 105 reduces the amount of disclosure required in the accounts and applies simpler measurement rules, while still requiring the financial statements to be based on the company's real accounting records. FRS 105 only applies when a qualifying company has actually chosen the micro-entities regime for that accounting period.

FRS 105 is intended for companies that qualify as micro-entities and decide 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 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 the size conditions is not the whole story, because other eligibility rules and exclusions can apply — for example, certain types of entity and certain group situations are outside the regime. Eligibility should be checked against your company's own circumstances rather than assumed.

No. The micro-entities regime is an available accounting regime, not a mandatory one. A company that meets the size conditions can choose to apply the micro-entities regime — and FRS 105 applies when that choice is made — or it can report under a fuller framework such as FRS 102 instead. The choice may come down to what the company's directors and lenders need from the accounts, and whether the simpler treatment under FRS 105 suits the way the business is structured. It is worth thinking this through before the year end rather than after the figures have been finalised.

For accounting periods beginning on or after 6 April 2025, a company generally needs to satisfy at least 2 of the following 3 conditions: turnover of no more than £1 million, a balance sheet total of no more than £500,000, and an average number of employees of no more than 10. Different thresholds applied to earlier accounting periods, so the date your period begins matters. On top of the size tests, the micro-entities regime has its own rules and exclusions, including rules that look at group situations and particular categories of entity. Meeting two of the three size conditions does not automatically mean a company qualifies, so the full position should always be checked.

Both FRS 105 and FRS 102 form part of UK GAAP, but they are aimed at different sizes of company. FRS 102 is a fuller framework, with more extensive recognition and measurement requirements and a much longer set of disclosure notes. FRS 105 is the standard tied to the micro-entities regime and is deliberately lighter: fewer notes, simpler measurement, and a shorter set of financial statements. In practice, the choice affects how the accounts look and how much detail appears in them, so it is worth considering alongside the needs of the company's directors, shareholders and anyone who relies on the figures.

Micro-entity accounts prepared under FRS 105 still form part of the company's annual accounts, and annual accounts are normally filed at Companies House in line with the company's filing obligations, subject to the company's own circumstances. Preparing the accounts and filing them are two separate steps, and both need attention. It is also worth noting that the filing requirements for small and micro-entity companies are subject to reform, so it is sensible to check the current Companies House guidance for the latest position rather than relying on how things worked in previous years.

Yes, they are two different things serving two different purposes. FRS 105 Micro Entity Accounts are the company's financial statements, prepared under the micro-entities regime for the accounts filing. A CT600 is a Corporation Tax Return submitted to HMRC, which works out the company's taxable profits and the tax due after adjustments. The accounts usually provide the starting point for the tax return, but the tax computation involves its own rules, allowances and add-backs. Filing accounts does not discharge the company's Corporation Tax obligations, and a CT600 does not replace the annual accounts.

It helps to gather your accounting records for the period: bank statements and reconciliations, sales invoices and receipts, purchase records and supplier statements, payroll information, details of any loans or hire purchase agreements, and a list of fixed assets with additions or disposals during the year. If the company has traded before, the previous year's accounts and opening balances are needed too, along with details of any share capital, dividends or director's loan movements. If you use accounting software, access or exported reports are usually the quickest route. The more complete the records, the more straightforward the preparation tends to be.