What are Annual Accounts exactly?
Your annual accounts — or ‘statutory accounts’ — are prepared from your financial records at the end of the financial year. You're required to send them to all shareholders, people who go to general meetings, Companies House, and HMRC.
Unless your company is new, annual accounts must be filed with Companies House nine months after the company's financial year comes to an end. Penalties rise steeply for every month late after the submission deadline, so it's important to get it right and on time.
Current Penalty thresholds
| Time after the deadline | Penalty (for private limited companies) |
|---|---|
| Up to 1 month | £150.00 |
| 1 to 3 months | £375.00 |
| 3 to 6 months | £750.00 |
| More than 6 months | £1,500.00 |
If you're an SME, you may be exempt.
The extent of what you'll have to submit all depends on the size of the company. Companies are exempt from audit and full financial statements if they're a 'Small Company'. You're considered to be a small company if you fulfil two of the following conditions:
- A turnover of £10.2 million or less
- £5.1 million or less on its balance sheet
- 50 employees or less
You're even more exempt as a Micro-Entity.
Further reduced disclosures can be made for 'Micro-entities'. That is any company that meet any 2 of the following conditions:
- A turnover of £632,000 or less
- £316,000 or less on its balance sheet
- 10 employees or less
Each type of disclosure (Audited, Small or Micro) will need to meet different accounting standards and submission criteria.