Another good thing that have come out of EU.
EU issued a directive no. 2012/6/EU as of 14 March 2012 to be implemented all over EU for micro entities.
UK government to comply with the above directive put in place: The Small Companies (Micro-Entities’ Accounts) Regulations 2013.
Main aim- To reduce administrative burden for small business to boost economy.
What is a micro entity?
If a company meets two of the following three conditions, it is classified as a micro entity:
• Turnover : not more than £632,000
• Balance sheet total : not more than £316,000
• Employees : not more than 10
What its use?
Mainly your accountant’s year end work is reduced thus the fee you pay is reduced.
How do we file annual accounts at Companies house ?
In the same way as you use to file, just select “Micro entity” while filing.
What is the impact for HMRC accounts and tax return?
HMRC accepts these accounts. There is no material impact on your corporation tax.