Countdown for companies on new accounting submission rules

Businesses have been given an extended deadline to prepare for major changes to the way company accounts are filed with Companies House, but advisers are warning against leaving preparation for the transition too late.

The reforms, introduced under the Economic Crime and Corporate Transparency Act 2023 (ECCTA), will take effect from April 2028 and will affect companies of all sizes but will be particularly significant for smaller businesses.

For the first time, small companies and micro-entities will be required to file profit and loss accounts with Companies House, alongside their balance sheet. However, they will be able to opt out of having their profit and loss information published on the public register.

Details of how that will work have yet to be confirmed, but any opted-out information will remain available to Companies House, HM Revenue & Customs and law enforcement agencies, as the objective of the reforms is to improve the accuracy and reliability of information held at Companies House and to help tackle economic crime. 

Companies will also need to submit all relevant parts of their accounts and reports at the same time, while businesses claiming audit exemption will face strengthened eligibility requirements.

The reforms will also require all companies to file their annual accounts using commercial software capable of producing accounts in what is known as iXBRL format,

whether a company files its own accounts or uses an accountant or other agent.

After objections to the planned changes forced the government to consult further on their impact, implementation has now been pushed back by a year to April 2028, but professionals are encouraging action sooner rather than later.

“Businesses must review whether their current systems and filing arrangements will meet the new requirements,” explained Anna Horrell, a specialist in Corporate law at Chattertons Solicitors & Wealth Management. “April 2028 may sound like a long way away, but changes may be needed to internal processes and that can take time to set up.

“The new filing requirements are not optional, and failure to get the new process right could quickly become expensive.  If new requirements are overlooked or accounts are rejected, the filing deadline continues to run and the penalties add up.”

Accounts filed late will attract automatic civil penalties, ranging from £150 for filings up to one month late to £1,500 where they are more than six months overdue. Those penalties are doubled if accounts are filed late in two successive years.

In some circumstances, failure to file accounts by the deadline may be treated as a criminal offence, and directors held personally responsible. Companies House can pursue prosecution and courts can impose fines, while persistent failure to meet filing obligations can ultimately lead to director disqualification or action to strike a company off the register.

Companies House is currently very active in this area: 303,412 penalties totalling £156.6 million were levied in 2025-26, and 73,374 double penalties with a value of  £77.9 million against companies who had filed their accounts late for two successive years or more.  With the additional powers to pursue directors under the ECCTA, enforcement activity is only expected to increase.

Anna added: “The practical message is to use the time wisely, particularly for smaller businesses. Reviewing current filing arrangements, checking software compatibility and getting to grips with the reporting requirements now could help avoid a last-minute scramble and potential fines when the new system becomes mandatory.”

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