Adventuring in Micro Business?
...Let's Make it a Fantastic Voyage
The reporting rules are changing for small and micro businesses, altering the amount and type of information they need to give to the authorities. Here's what it means for you.
The accounts you file at Companies House make up a large part of how the government thinks of your business. The amount of information you have to give them depends on the size of your company, and right now those rules and thresholds are changing. Your business might be smaller than you think - and that might not be a bad thing.
After the 1st of January 2015, the new thresholds for being considered a "small" company will be:
If those numbers still seem pretty huge to you, then you may actually be a "micro" business, in which case you'll have separate rules of your own. Basically, you're a micro business if you have:
Under the new system, smaller companies will no longer be able to file the "abbreviated" accounts they may have been used to, but can shift to "abridged" accounts instead. We know - that doesn't sound like a major change, but it's guaranteed to trip businesses up if they're not prepared for it. Accounts for micro companies can actually be even less detailed - you won't need to submit much more than a balance sheet, along with a few notes covering any loans to Directors, capital commitments or so-called "contingent liabilities" (meaning things you may or may not have to deal with, depending on how they turn out).
Providing less information when you're filing your accounts than a larger company needs to may or may not be a good thing, depending on how you look at it. A lot of small business owners like the idea of keeping more of their personal information out of the public eye, and that's very understandable. That said, those public records are frequently used by lenders or potential investors to make decisions about whether they want to work with you.
The bottom line is that you may have different reporting options now than you had before. There's been a wide range of responses to this announcement, from positive to perplexed and all the way to apoplectic, but you can rest assured that your Business Bodyguards at RIFT Accounting are on the case. Your existing monthly fee still covers everything and, whatever size of business you're running, we'll make sure all your accounts are accurate and up-to-date.
Get in touch if you want to discuss your choices under the new system, and remember to watch this space for more Voices From the RIFT.