FRS 105 Micro Entity Accounts in Nuneaton for Qualifying Companies

FRS 105 is the UK financial reporting standard that applies to the micro-entities regime. It sets out how a qualifying company should recognise and measure amounts in its statutory financial statements, and it permits a simplified presentation with far fewer disclosure notes than other UK frameworks. In practice, it means a shorter set of accounts built mainly from your own records, with restricted use of revaluation or fair value adjustments. FRS 105 sits alongside other UK standards such as FRS 102, which is used by larger companies and by small companies applying the small companies regime.

FRS 105 is intended for companies that qualify as micro-entities under the UK rules and that choose to apply the micro-entities regime. Qualifying is a test of size plus other conditions, and some companies are excluded regardless of their size — for example, where the nature of their activities or structure means the regime is not available to them. There are also practical considerations, such as holding financial instruments that FRS 105 does not accommodate well. Because the assessment is fact-specific, it is worth checking eligibility before assuming the regime applies to your company.

No. Qualifying for the micro-entities regime does not force a company to use FRS 105. A company that meets the size conditions can generally choose to apply the micro-entities regime, in which case FRS 105 is the framework used, or it can prepare accounts under the small companies regime using FRS 102 Section 1A instead. The choice affects how the accounts are presented and how much disclosure is included, so companies sometimes weigh up the needs of lenders, investors or other users before deciding. Once a framework is chosen, it should be applied consistently for the period.

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. Lower thresholds applied to earlier accounting periods, so the rules that apply depend on when your period began. Meeting the size conditions is not the end of the story — additional eligibility rules and exclusions exist, which is why a company should confirm its position for each accounting period rather than relying on the previous year's treatment.

Both are UK financial reporting standards, but they are aimed at different sizes and needs of company. FRS 105 is the micro-entities framework: it is deliberately streamlined, with a simpler measurement basis and minimal disclosures. FRS 102 is the main UK GAAP standard, and its Section 1A provides the small companies regime, which allows more accounting options and requires more disclosure than FRS 105. A company qualifying as a micro-entity may be able to choose between the two. FRS 102 Section 1A is often preferred where the accounts need to support more complex transactions or where a lender or investor expects a fuller set of notes.

Yes, where the company is required to file statutory accounts, the financial statements are filed with Companies House in the usual way, after they have been approved and signed by the board in accordance with company law. The filing deadline is based on your company's accounting reference date and circumstances, so it is worth checking the date that applies to you — late filing has consequences. Micro-entity accounts can be filed in a reduced form, and the content of what is filed differs from a full set of accounts. Filing the accounts is a separate exercise from submitting a Corporation Tax Return to HMRC.

Yes, they are two different things with different purposes and different recipients. FRS 105 Micro Entity Accounts are the statutory financial statements, prepared under the micro-entities framework and normally filed with Companies House. The CT600 is the Corporation Tax Return, submitted to HMRC, which reports the company's taxable profit and claims any reliefs due. The tax return usually starts from the figures in the accounts, but adjustments — such as disallowable expenses or capital allowances — can mean the taxable profit is not the same as the accounting profit. Meeting one deadline does not satisfy the other.

In most cases we need a complete picture of the company's transactions for the period: bank and credit card statements, sales and purchase records, invoices, payroll information, details of any assets bought or sold, loan and hire purchase agreements, director's loan movements, stock or work in progress where relevant, and the previous year's accounts if there are comparatives. If you keep digital bookkeeping records, giving us access can make the process smoother. Anything unusual during the period, such as a new income stream, a grant or a significant one-off transaction, is worth flagging early so it can be considered when the accounts are prepared.

Companies House has been implementing reforms under the Economic Crime and Corporate Transparency Act, and these affect how accounts are submitted and what is accepted. The direction of travel is towards more digital filing through approved software, with less scope for heavily reduced or abbreviated accounts. The changes are being introduced in stages, so the requirements depend on your filing date and the software you use. Because the position is moving, it is sensible to confirm the current requirements with us shortly before your accounts are due, so that what is prepared and filed matches the rules in force at that point.