News
Changes in company size thresholds on the horizon
The Secretary of State for Business and Trade has confirmed the Government will make changes to UK company size thresholds.
By Catherine Heinen, FCCAOriginally announced by the previous Government, new legislation on company size thresholds is likely to come into force in April 2025. Jonathan Reynolds, Secretary of State for Business and Trade has confirmed that his “department will lay legislation by the end of the year” by “uplifting the monetary size thresholds for micro-entities, small and medium-sized companies”.
Current thresholds are set out based EU legislation, and are as follows:
A company is classified as ‘micro’ when it satisfies two of the following:
- a turnover of £632,000 or less
- £316,000 or less on its balance sheet
- 10 employees or fewer
A company is classified as ‘small’ when it satisfies two of the following:
- a turnover of £10.2 million or less
- £5.1 million or less on its balance sheet
- 50 employees or fewer
A company is classified as ‘medium’ when it satisfies two of the following:
- a turnover of £36 million or less
- £18 million or less on its balance sheet
- 250 employees or fewer
Above these thresholds, a company is classified as ‘large’.
It is expected that the thresholds could be increased by 50%, resulting in many medium-sized companies being classified as small.
The changes may encourage more businesses to incorporate. If you’re considering making changes to your business structure or you’re new in business and not sure what your options are, speak to an accountant today. Our accountants are friendly and helpful, so please contact TaxAssist Accountants today on 01737 420 490 or use our online contact form.
Date published 25 Oct 2024 | Last updated 28 Oct 2024
Catherine Heinen, FCCA
Catherine is a Technical Content Writer at TaxAssist Accountants, and a qualified accountant. With experience working at two accountancy practices in the UK top 50 accountancy firms according to Accountancy Age, Catherine has significant experience in accounts, tax returns and advising clients. Catherine ensures businesses, business owners and individuals are kept up to date and informed by providing concise and informative technical material.
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