What is it ?
A company in the UK qualifies as a Small Company if it fullfills two of the following three criterias:
Turnover – not more than £6.5m
Balance sheet total – not more than £3.26 m
Employee – not more than 50
UK Government has increased these limits to comply with EU Accounting Directive
via a new regulation
Turnover – not more than £10.2m
Balance sheet total – not more than £5.1 m
Employee – remain same at 50.
From when the rules change ?
Rules change for accounting period begining on or after 1 Jan 2016.
Why it is important ?
Small companies donot have to get their books audited.
This will reduce the administrative burden on lot of small companies and allow them to focus on their business.
Nottinghill Accountants 