FRS 105 Micro Entity Accounts in Wallasey

FRS 105 is the UK financial reporting standard for companies using the micro-entities regime. It sets out how a qualifying micro-entity's annual accounts should be prepared, including the format of the balance sheet, which notes are required, and which accounting treatments are not permitted. It is a deliberately simplified framework: it avoids several of the measurement and disclosure requirements that apply to larger companies, so the resulting accounts are shorter and more straightforward. FRS 105 applies when a company has chosen to apply the micro-entities regime — it is the reporting standard that goes with that choice.

FRS 105 Micro Entity Accounts are available to companies that both qualify for the UK micro-entities regime and choose to apply it. Qualifying depends on the company meeting the applicable size conditions — generally at least 2 of 3 — and also on not being caught by the rules and exclusions that sit around the regime, such as the types of entity that cannot use it. Because eligibility is not automatic and can change as a company grows, shrinks or changes what it does, it is worth reviewing your position with an accountant before deciding which framework to use for a particular accounting period.

No. The micro-entities regime is an available accounting regime rather than a mandatory one. A company that qualifies for it may choose to apply the regime — and if it does, FRS 105 is the standard used to prepare the accounts. Alternatively, a qualifying company may decide to prepare its accounts under FRS 102, which involves fuller disclosure and additional accounting options. The decision can depend on what the directors want the accounts to show, the company's plans, and whether any lenders, investors or group companies expect a particular basis of reporting. Once a framework is chosen, it should be applied consistently and any change of framework handled correctly.

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, subject to the relevant rules and exclusions: 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 those size conditions is the starting point, not the whole test — other eligibility rules and exclusions can apply, and some companies are prevented from using the regime regardless of their size. Because the assessment is specific to your company and your accounting period, we look at your actual figures rather than assuming.

FRS 105 is the simplified standard for qualifying micro-entities, while FRS 102 is the fuller framework used by most other companies. FRS 105 permits far less disclosure, removes many of the accounting options available under FRS 102, and does not allow treatments such as revaluation of certain assets, fair value measurement in the same way, or the recognition of deferred tax. The practical effect is that FRS 105 accounts are shorter and easier to read, but they present a narrower picture of the company's position. FRS 102 accounts are more detailed and more flexible, which can matter where a third party expects a fuller set of financial statements.

Yes. Preparing accounts is one step, and delivering them to Companies House is another. A company using the micro-entities regime still has to file its annual accounts, although the version filed is typically much shorter than the accounts a larger company would deliver, generally comprising a balance sheet with limited notes rather than extensive disclosure. The filing obligation sits separately from your Corporation Tax responsibilities, and the statutory accounts must still be prepared and approved by the directors in the required way. Your FRS 105 Micro Entity Accounts therefore form the basis of the Companies House filing even though the filed copy is condensed.

Yes — they are two distinct filings with two different recipients. The FRS 105 Micro Entity Accounts are financial statements prepared under the micro-entities framework and are filed with Companies House. A Corporation Tax Return (CT600) is submitted to HMRC to report the company's taxable profits and calculate the tax due. The accounts figures are usually the starting point for the tax computation, but adjustments are then made for tax purposes, so the taxable profit will often differ from the accounting profit shown in the accounts. Neither filing replaces the other, and a Confirmation Statement is a further separate requirement.

We need a clear picture of the company's trading and position for the accounting period. In practice that means your bookkeeping or accounting records, bank and credit card statements, sales and purchase records, payroll information if you employ staff, details of any loans or amounts owed to and by the company, and information about assets such as equipment, vehicles or fixtures together with any purchases or disposals in the period. If stock is held, we will need a value or a basis for it. It also helps to know whether you have filed accounts before and under which framework, plus any significant one-off events during the period. The more complete the records, the smoother the preparation.