Every limited company in the UK must file Annual Accounts. These accounts, often referred to as Statutory Accounts, provide a detailed and transparent view of your company’s financial position over the past year.
Filing these accounts is a legal obligation.
What are Annual Accounts?
Annual Accounts are official documents all companies must prepare at the end of each financial year. They summarise your company’s income, expenses, assets and liabilities. Their purpose is to present a clear report of your company’s financial activity over the year.
Companies must submit these accounts to Companies House and HMRC, and also share them with all shareholders and individuals entitled to attend general meetings.
They are also essential for calculating how much Corporation Tax your company needs to pay.
What Do Annual Accounts Include?
Full statutory accounts generally consist of:
1. Balance Sheet – Read More
A snapshot of everything the company owns (assets), owes (liabilities) and is owed at the end of the financial year. The Balance Sheet must include the name of a director and they must also sign it.
2. Profit and Loss Account
A breakdown of the company’s revenues, costs and whether it made a profit or a loss during the year.
3. Notes on the Accounts
Extra detail to help explain the figures, accounting methods used and any significant changes.
4. Director’s Report
A summary prepared by the company’s directors including activities, compliance and future outlook. Micro-entities are exempt from this requirement.
5. Auditor’s Report
Required if your company needs an audit. This confirms whether the accounts give a fair view of the company’s finances.
Who Needs to File Annual Accounts?
All UK-registered companies must file Annual Accounts, regardless of size or trading status. This includes:
- Trading companies
- Dormant companies (no significant transactions)
- Companies breaking even or making a loss
Filing is a legal obligation and applies even if your business is inactive. Remember the following:
- You must file First Accounts within 21 months of your company’s incorporation date
- You must file Subsequent Accounts within 9 months of your accounting reference date (your company’s financial year-end)
Late filing can resulting in escalating penalties and, in extreme cases, Companies House may strike your company off the register.
Can You Submit Simpler Accounts?
Yes.
You may file a simplified version of accounts if your company qualifies as a small company or micro-entity.
1. Small Companies must meet at least two of the following:
- Turnover of less than or equal to £15 million
- Balance Sheet total of less than or equal to £7.5 million
- 50 employees or fewer
2. Micro-Entities must meet at least two of the following:
- Turnover of less than or equal to £1 million
- Balance Sheet total of less than or equal to £500,000
- 10 employees or fewer
Qualifying companies can file abridged or micro-entity accounts. These are simpler and require less financial detail. They also remove the need for an auditor’s report and, in some cases, a full Profit and Loss Statement. However, this may change.
Dormant Companies and Their Responsibilities
Companies House consider a company “Dormant” if it has not had any significant transactions during the financial year. This does not include things such as filing fees or share payments at incorporation. Dormant companies must still file accounts but may use a simplified format.
If the company qualifies as dormant, they are usually exempt from filing a Company Tax Return with HMRC unless the company was active during the period. If they qualify as small, they are also exempt from audit.
Filing Your Annual Accounts
The most efficient way to file your accounts is online. Here is what you will need:
- Your company’s authentication code
- A Government Gateway user ID (if filing with HMRC)
You can choose to file the accounts with Companies House WebFiling or through approved commercial software. Alternatively, you may wish to hire a professional accountant to handle everything for you.
Currently, if you are eligible, you can still file both Companies House and HMRC accounts together using the Joint Filing Service. However, from 31st March 2026, this service will permanently close.
From 1st April 2026, businesses must use commercial software for their submissions and they will no longer be able to submit both filings in one go. They must make submissions separately, through different platforms.
Penalties for Late Filing
Failing to file your accounts on time can be costly:
- £150 for up to 1 month late
- £375 for 1 to 3 months late
- £750 for 3 to 6 months late
- £1,500 for over 6 months late
The penalty will double automatically if you miss deadlines for 2 years in a row. Serious delays can lead to Companies House striking your company off the register and directors facing prosecution.
Appealing a Late Filing Penalty
You can appeal a penalty if there was a genuine reason for the delay. Valid reasons include:
- A fire or flood
- Serious illness
- Theft of financial records
However, reasons such as not knowing the rules or blaming someone else is not acceptable. To appeal, you must provide a detailed explanation and any supporting evidence. Companies House will review the appeal before making a final decision.
Do You Need an Accountant?
You can submit Annual Accounts yourself if you are confident and your business is straightforward. However, most companies benefit from using a qualified accountant. An accountant will ensure everything is accurate and complete, then submit the accounts on time.
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