By WatkinsonBlack
If you run a small limited company, you may have grown accustomed to a degree of financial privacy. For years, the rules have allowed smaller businesses to file what are known as ‘filleted’ accounts, essentially a stripped-back version of your annual figures, typically just a balance sheet, with no requirement to disclose how much your business earned or spent. For many owners, that privacy has felt like one of the few quiet perks of running a small company.
What’s Actually Changing?
The Government has now confirmed that from 1 April 2028, all UK-registered companies, including small companies and micro-entities, will be required to file a full Profit and Loss (P&L) account with Companies House, in addition to the balance sheet they already submit each year. The reform forms part of the Economic Crime and Corporate Transparency Act 2023 (ECCT Act), legislation designed to improve the accuracy and reliability of data on the companies register and to help tackle fraud and financial misconduct.
The change was originally due to come into force in April 2027 but following extensive lobbying from business groups and accountancy bodies, the Government pushed the implementation date back by a full year. That gives most companies approximately one complete accounting period plus nine months to prepare which sounds generous but will pass faster than you might expect.
Will My Turnover Be on Public Display?
This is where things get more nuanced and where there is, genuinely, some good news.
The initial proposals would have made all filed P&L accounts fully visible on the public Companies House register, meaning anyone, a competitor, a supplier, a nosy neighbour could look up your turnover, your gross profit, and your director’s salary with a couple of clicks. Unsurprisingly, that prospect drew significant pushback from small business owners and advisors alike.
Following that lobbying, the Government has confirmed that small companies and micro-entities will have the option to opt out of having their P&L published on the public register. Companies House has acknowledged concerns from the business community about the ‘privacy and commercial risks’ of requiring smaller companies to disclose this information publicly. Details of exactly how the opt-out process will work have not yet been confirmed, but guidance is expected to follow in due course.
It is important to note, however, that opting out of public disclosure does not mean opting out of the obligation to file. The P&L must still be submitted to Companies House, and when filed, it will remain accessible to HMRC, Companies House itself, and law enforcement agencies for the purposes of identifying fraud or financial crime. The opt-out simply determines whether the information appears on the public-facing register.
Other Changes Coming at the Same Time
The P&L requirement is only one part of a broader package of reforms taking effect in April 2028. Two other changes are worth flagging now.
First, the option to file abridged accounts, a format that required formal shareholder approval and compressed key figures into broad categories is being abolished entirely. In practice, this is unlikely to be a significant loss; abridged accounts were widely considered cumbersome, and relatively few companies used them.
Second, and perhaps more immediately practical, all UK companies will be required to file their annual accounts using commercial software that supports Inline eXtensible Business Reporting Language, better known as iXBRL. This is a digital tagging format that makes the data within accounts machine-readable. From April 2028, the existing options to file accounts via the Companies House web portal or submit paper copies will be closed for accounts filings. If you currently file your own accounts directly through the web, you will need to use software instead.
What Should You Do Now?
April 2028 may feel comfortably distant, but the reality is that for many businesses, this reform will affect accounts for periods that are already underway. The key steps to consider sooner rather than later are these.
Talk to your current accountant or reach out to us. If you have not already had a conversation about how these changes affect your specific situation, now is the time to raise it. The opt-out mechanism, in particular, will require decisions to be made once the process is confirmed, and it is better to understand your options in advance.
Review your software. If you use accounting software yourself, check whether it supports iXBRL filing via the Companies House API. Platforms such as Xero, QuickBooks, and Sage are expected to be compliant, but it is worth verifying.
Think about what your P&L will show. Even if you intend to opt out of public disclosure, the prospect of your figures being filed with Companies House is a good prompt to review the health of your accounts. Are there areas of the business you want to tighten up before the numbers become part of any regulatory record?
The Bigger Picture
The Companies House reforms reflect a broader Government effort to make the UK’s corporate register more transparent and harder to abuse. For the vast majority of legitimate small businesses, the practical impact will be manageable. But the reforms do represent a meaningful shift in what is expected of smaller companies, and those who start preparing now will be in a far more comfortable position than those who leave it until 2028.
WatkinsonBlack have considerable experience in all areas of taxation and business services. This includes providing a very cost-effective payroll bureau service, as well as assisting to ensure compliance with the latest Making Tax Digital legislation. If you are employed or self-employed either as a sole trader, partnership or limited company and want to arrange a no-obligation initial meeting on any taxation or accounting matter then please contact us by telephone on 01925 413210 or by e-mail to info@watkinsonblack.com. Please note that these ideas are intended to inform rather than advise and you should always obtain professional advice before taking any action.
