Accounts Filing & Preparation
At the end of your business year your company must produce and file with Companies House a full set of company accounts.
Failure to do this by the deadline can result in penalties or fines, as can errors or deliberately attempting to mislead Companies House.
Our accountants are on hand to help, making sure you produce timely, accurate company accounts to avoid penalties or fines.
Most businesses in the UK must produce annual accounts and file them with Companies House and HMRC each year, these are called company accounts. Ultimately, these account are to report your companies activity or the year determine how much corporation tax you need to pay.
It is the legal responsibility of the Directors to ensure that the are competed accurately and filed on time. Failure to do so can lead to some hefty fines being levied from Companies House and HMRC separately. Fines from Companies House start at £150 and go up to £1500. Fines levied by HMRC start at £100 to 20% of the Corporation Tax Liability of your company. So it pays to do these correctly and on time.
All UK companies, unless the company is dormant or is a 'small' company, must complete and file full company accounts each year for HMRC and Companies House.
These accounts need to be filed with the companies shareholders too.
Full Company Accounts need to include the following:
A dormant company is a company that is not trading, either because it has ceased trading or because it is not yet ready to trade.
In these events HMRC needs to be informed, and you will not have to produce a full set of Company Accounts at the end of your financial year. However, you will still have to provide a set of dormant accounts. Dormant accounts consist of the balance sheet as well as notes about the accounts.
To be classed as a small company your business must meet 2 of the following criteria:
In the event that you meet two of these criteria you can file 'small company' accounts instead, and these do not have to be audited.There is a third type of accounts that may need to be filed, and these are for a micro-entity.
To be classed as a micro-entity you need to meet at least two of the following criteria:
Successfully run business' are stable, they keep a close eye on their finances.
This is not just the basics of revenue, but any losses and expenditures too.
Whilst our accountants and bookkeepers can prepare these reports for you, sometimes it can be difficult to understand the figures on the paper.
Company accounts can be really useful, they highlight profit and loss. Moreover they can highlight areas of your business that are going well and also areas that may be in trouble. This can allow you to plan contingencies in the case that an area identified is not performing as well as hoped.
Our professional accountants offer guidance and support in understanding your annual reports and can highlight any trouble spots so that you can plan and adapt your business approaches to maximize profitability. If you are looking for that support why not contact us here.
For small companies the statutory obligation is only the balance sheet, it is much easier to prepare a balance sheet if you have a profit and loss account.
Profit and loss accounts provide a what is know as a basic trading summary. This will include all expenditure, for example how much goods or services have been sold and any further expenditure, for example wages.
This will also include a Balance Sheet and a Cash Flow Statement which will also include tax related expenditure or other outgoings. This will in turn make changes to your profit and loss statement.
Our professional accountants are on hand to help you prepare these at the end of your financial year. Do not worry what format you have done your bookkeeping in, whether it is in excel, or raw data from your bank statement or original invoices, they will be on hand to assist in the creation of these statements.
If your company is considered to be small, and has a turnover of below £6.5 million per annum, you are able to file abbreviated accounts with Companies House.
Nonetheless, you must still create full statutory accounts for HMRC and shareholders.
If your company is dormant, you must still create dormant companies account, inclusive of balance sheet and notes, and file this with Companies House.
If you company has a turnover of £6.5 million per annum, or has assets of a value no greater that £3.26 million, or has less than 50 employees, it can apply for an audit exemption.
A medium or small sized company that is filing full accounts is called Total Exemption Full.
A medium or small sized company that is filing abbreviated accounts with Companies House - Total Exemption Small.
A company that is not currently trading and does not currently have trading accounts is called Dormant.
Within nine month and one day of the date your company is formed, is usually the due date for corporation tax.
If your company has profits of up to £300,000 it is usually 19% for corporation tax.
See below for 7 ways to get paid faster on your accounts receivable.1. Collect electronic payments. 2. Lower the Payment Terms. 3. Keep your work relationship healthy. 4. Allow different payment methods, e.g. cash, electronic, cheque. 5. Hire an accountancy company. 7. As a last resort hire someone to collect the money.
Many companies will not need to have their annual accounts audited. If you are a smaller company, you will only have to audit your company accounts at the shareholders request or if their articles of association dictate that they must.
With the exception of NHS charities, your charity will only need to be audited if it has a gross income of £25,000 or more per financial year.
If your charities gross income is less than this you will not need to have them audited, unless the charities governing document makes it a requirement.
It is possible to apply for an audit exemption.
If you are a small company, you may not have to get an audit of your accounts, unless your companies articles of association state that you do, or your shareholders ask for one.
If your company has a turnover of less than £6.5 million a year, or has assets of less than £3.26 million then it can apply for total exemption, as per the 2006 regulation laid out by companies house.
It is still possible to send your company accounts to Companies House on paper.
It must also contain the company name and number, which should appear on one of the pieces of paper, for example the balance sheet or directors report.
A Micro-entity is a very small company. For you company to qualify as a micro-entity it must fulfill 2 of the following criteria.
In the event that you do not have a company sick pay scheme, your employer will still have to pay you Statutory Sick Pay (SSP), as long as you meet the requirements.
Your employer does not have to pay it for the first three days of illness, unless, within the last eight weeks you have been paid SSP and are eligible for it still. SSP is currently paid at £92.50 per week.