BUSINESS
On 6 April 2025, updates will be introduced to reflect inflation, ensuring smaller businesses benefit from reduced regulations.
Company size thresholds have not changed since 2013, so this is a welcomed change for small businesses.
New size thresholds
A company qualifies for a category if it meets two of the three criteria:
| Size of business |
Turnover (up to) |
Balance sheet (up to) |
Number of employees (up to) |
| Micro |
£1m (was £632k) |
£500k (was £316k) |
10 (no change) |
| Small |
£15m (was £10.2m) |
£7.5m (was £5.1m) |
50 (no change) |
| Medium |
£54m (was £36m) |
£27m was (£18m) |
250 (no change) |
These changes also apply to LLPs.
Key impacts
- 113,000 companies will move from small to micro, 14,000 from medium to small, and 6,000 from large to medium
- Newly small businesses won’t need a statutory audit unless part of a group
- Medium entities no longer need a Strategic Report; large entities moving to medium can skip certain disclosures
- Reduced requirements for large and medium-sized businesses. Fewer disclosures including:
- Financial instruments
- Post-year end events
- Future developments
- R&D activities
- Overseas branches.
How this affects your pest control business
Now a Small Business? (previously Medium)
- No more statutory audits (unless part of a group requiring one)
- No need for a Strategic Report, reducing reporting complexity
- Reduced Directors’ Report obligations, simplifying compliance.
Now a Medium Business? (previously Large)
- No need for a Section 172(1) statement in the Strategic Report (which details directors’ considerations of stakeholders)
- Reduced Directors’ Report obligations, simplifying compliance.
Now a Micro-Entity? (previously Small)
- No need for a statutory audit
- Exempt from Directors’ Report requirements.
Transitional rules
To make the transition easier, companies can assume the new thresholds applied in the previous financial year.
This means businesses can benefit from reduced reporting immediately.
What should business owners do?
- Check your company’s new size category and understand how it affects reporting
- Review audit and reporting obligations – you may no longer need a statutory audit
- Consider restructuring opportunities to simplify compliance further
- Seek expert advice to maximise the benefits of these changes.
GOT QUESTIONS?
If you have any concerns or questions, get in touch and we'll try to find the answers.
[email protected]
FURTHER READING
legislation.gov.uk/uksi/2024/1303/contents/made
Source: Online