UK Company size thresholds are changing

The UK Government has unveiled plans to raise the thresholds determining a company's size for financial reporting purposes. This move is poised to streamline reporting for small to medium enterprises, potentially alleviating the regulatory complexities faced by local businesses and enabling them to refocus on their core activities.

The new thresholds are shown below:

In addition, the government also plan to consult on the definition of a medium sized company in terms of employee numbers, raising the maximum number of employees that classifies a medium sized company from 250 to 500.

For many this will be a welcome development, helping reduce the complexity and burden from legislative reporting requirements for local businesses and allow more focus to be placed on their core operations.

It is crucial to recognize that the full implications of these regulatory adjustments must be carefully assessed for each individual business. While the increased thresholds may lighten regulatory burdens, they could also impact aspects such as transparency, accountability, and investor confidence. Therefore, it is imperative for businesses of all sizes to remain well-informed about these changes and understand how they will impact their reporting requirements and compliance responsibilities moving forward.

The government intends that companies will be able to benefit from these changes for financial years commencing on or after 1 October 2024 and businesses should plan to adjust their processes accordingly to ensure compliance with the new thresholds.

For any inquiries or assistance in navigating these changes, the expert team at BDO NI stands ready to provide support and address your questions. Feel free to reach out to us without hesitation.