Limited companies in the UK must prepare annual returns and annual accounts. These two documents have nondescript sounding names and share a requirement to be filed at Companies House every year. The similarity between them means it can be very easy to confuse the two. Briefly stated, “annual accounts” report the financial data over a period of time (usually a year), whereas an “annual return” reports the administrative and legal data about a company.
There are fines for late filing of annual accounts, and non-filing of either the accounts or return can result in Companies House seeking to strike your company off, i.e., close it down. It is therefore very important that if you are involved in running a company, you understand the difference between the two. In this blog, we will take a look at annual returns and accounts for small companies.
For both annual accounts and annual returns, Companies House will write to the registered office specifying the date they must be filed. The annual accounts must be filed within nine months of the year end, which can be changed to suit the company.
If your company is trading, we will likely prepare your annual accounts for you. We will prepare a long set of accounts known as “statutory accounts” which are for the directors, shareholders, and for filing with HM Revenue & Customs alongside the company’s tax return. We also prepare a shorter set of accounts, called abbreviated accounts, for filing with Companies House. These accounts are publicly available to anyone who asks for them, so we ensure they contain basic information about your company so as not to reveal sensitive information to your competitors.
The abbreviated accounts comprise the balance sheet (a snapshot of the company’s assets and liabilities at the year end) and a few explanatory notes. The longer set of accounts adds a director’s report, a profit and loss account (which shows your income, expenses and profit or loss for the year) and considerably more notes. Further pages may be required depending on the size of your company.
Companies that haven’t traded are known as being ”dormant” and can either file abbreviated accounts with Companies House or in some circumstances a “dormant company accounts” (DCA) form AA02.
Accounts can be posted to Companies House or filed online. Companies House do not charge for filing accounts.
This is a form that asks the company to confirm or correct certain facts such as the following:-
- the company’s main business activity (or activities)
- the director’s and secretary’s details
- the class and number of shares in issue
- the registered office address
- a list of shareholders, which must be provided every three years
As with the annual accounts, this form is publicly available so it is important to not unnecessarily state anything on the form that the directors would not want to be in the public domain, e.g., the home addresses of the company’s officers.
Companies House charge £13 to file the annual return online or £40 if you post a paper form to them.
Southside Accountants in Wimbledon & London, prepare and file annual accounts and annual returns for our clients and would be happy to assist you.