FRS 105 Micro Entity Accounts in Prestatyn

FRS 105 is the UK financial reporting standard that applies to companies preparing accounts under the micro-entities regime. It sets out how the financial statements of a qualifying micro-entity should be prepared, including how amounts are recognised and measured and what disclosures are required. It is a simplified framework compared with the standards used by larger companies, which is why micro-entity accounts tend to be shorter and more concise. FRS 105 applies when the micro-entities regime is chosen; it is not a separate filing in its own right, but the accounting basis on which the accounts themselves are produced.

FRS 105 is intended for companies that qualify for the UK micro-entities regime and that choose to apply it. Qualification is determined by the size conditions that apply to your accounting period, together with any other relevant rules and exclusions. It is not enough simply to be a small company, and meeting the size conditions does not automatically mean the regime is available, because other eligibility rules can affect the position. It is also a choice: a qualifying company may use the micro-entities regime or another permitted framework. If you are unsure where your company stands, your eligibility should be reviewed against your specific circumstances rather than assumed.

No. Even where a company qualifies as a micro-entity, the regime remains optional. Qualifying companies are permitted to apply it, but they are not obliged to, and some directors prefer a different framework for reasons connected with lenders, investors, group arrangements or the information they want to see. Where the micro-entities regime is not adopted, FRS 105 does not apply and the accounts are prepared on another basis instead. The decision is usually best made with an understanding of who will read the accounts and what those readers need.

For accounting periods beginning on or after 6 April 2025, a company generally needs to meet at least 2 of the 3 applicable size conditions. These 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 during the period. Meeting 2 of the 3 is the usual starting point, but other rules and exclusions can apply, and certain companies are prevented from using the regime altogether. Because eligibility depends on your own figures and circumstances, it is worth checking rather than assuming you qualify.

Both are UK financial reporting standards, but they are aimed at different sizes of company. FRS 105 is the micro-entities standard, providing a simplified basis with reduced disclosure requirements. FRS 102 is the standard used more broadly, including by many small and medium-sized companies, and it involves more detailed recognition, measurement and disclosure requirements. In practice, the framework a company uses affects the length and complexity of its accounts, the notes provided, and the level of detail in the figures. Choosing between them is a decision about which framework you qualify for and which best suits how your accounts will be used.

Yes. Where a company prepares its annual accounts under FRS 105, those accounts form the financial statements that are filed with Companies House as part of the company's annual filing obligations, subject to the filing requirements that apply to the company. Filing accounts with Companies House is a separate obligation from your Corporation Tax responsibilities. It is also distinct from a Confirmation Statement, which confirms company details such as directors and registered office and is not a set of accounts. Keeping these three areas separate helps avoid confusion about what is due and when.

Yes, they are separate. FRS 105 accounts are the company's financial statements, prepared under the micro-entities framework and filed with Companies House. A Corporation Tax Return, commonly submitted as a CT600, is a tax filing made to HMRC to report the company's taxable profits and work out the Corporation Tax due. The figures in your accounts often form the starting point for the tax return, but adjustments may be needed, so the two documents are not identical. Because they are handled by different authorities and serve different purposes, both need to be dealt with properly.

The exact list depends on your business, but you will usually need your bookkeeping records or accounting software access, bank statements covering the period, sales and purchase information, details of expenses, information about any assets and liabilities, and records of director's loans or other balances if relevant. Details of stock, work in progress, and any financing arrangements also help. If you have prepared accounts before, your previous year's figures are useful for comparison. The more complete and organised your records are, the more efficiently the accounts can be prepared and the fewer follow-up questions there are likely to be.