Small businesses and micro‑entities can breathe a sigh of relief as the government has paused the forthcoming requirement to file full profit and loss (P&L) accounts at Companies House. The reform, originally expected to take effect from April 2027, will no longer proceed on that timeline, with officials confirming that plans remain under review. Companies will receive at least 21 months’ notice before any new filing obligations come into force.
Why the pause?
According to the update published on GOV.UK, the government is re-assessing the proposals amid concerns about striking the right balance between enhancing corporate transparency and avoiding excessive administrative burdens for small businesses. Companies House has acknowledged feedback from stakeholders who warned that the reforms risked placing a disproportionate strain on smaller entities.
Although the plans had previously appeared firmly scheduled, political signals in recent months hinted at a rethink. Comments from sources close to ministers suggested that the requirements were unlikely to go ahead as originally framed, aligning with the government’s broader goal of reducing regulatory pressure on businesses.
What the original proposals included
The P&L filing requirement formed part of the Economic Crime and Corporate Transparency Act, which aimed to strengthen the quality and visibility of financial information on the public register. Had the reforms been implemented, small and micro‑entities would have been expected to submit significantly more detailed financial data, including:
- A full profit and loss account
- A balance sheet
- A directors’ report (for small companies)
- An auditor’s report where applicable
The overarching intention was to increase transparency and support efforts to combat financial crime.
Reactions from the accounting community
The proposed shift generated considerable debate among accountants and small business owners. Some welcomed the increased transparency, arguing that full P&L disclosure is a reasonable trade‑off for the benefits of limited liability. Others felt the requirement would create unnecessary risks, particularly around the public release of commercially sensitive information such as margins and pricing structures.
Many also questioned whether the new rules would genuinely produce meaningful anti‑fraud benefits, noting that the vast majority of small companies operate legitimately and that the change risked burdening compliant firms rather than discouraging bad actors.
Impact on the 2027 Compliance Landscape
The pause may come as a relief to firms preparing for what was already expected to be a demanding compliance year. Other regulatory changes remain on track, including:
- Mandatory payrolling of benefits in kind from April 2027
- Making Tax Digital for Income Tax Self Assessment for individuals earning over £30,000 from April 2027 (for individuals earning over £50,000 this will be from April 2026)
With these initiatives already creating pressure, removing the imminent P&L filing requirement provides welcome breathing space.
What happens next?
The government has yet to issue a final decision. For now, small businesses should continue filing accounts under the current rules, with no obligation to disclose their P&L publicly. Any future changes will come with substantial advance notice.
Get in touch
For further information or advice in relation to your filing requirements, contact a member of the team today by emailing enquiries@pmm.co.uk or calling 01254 679131.
