Small business owners have forced a rethink of reforms designed to tackle fraud and improve the accuracy of Companies House filings.
Jonathan Reynolds, the Business Secretary, is reviewing changes announced by the corporate registry a week ago to overhaul how businesses file their accounts and disclose more information about their finances.
Companies House declared that fom April 2027 firms would need to file data using third-party commercial software. The changes would also see “small and micro” businesses being required to file a profit and loss statement for the first time. Currently, these firms are able to file abbreviated accounts.
The plans were initially unveiled under the Conservative government in 2019 as part of measures to tackle financial abuse and improve the accuracy of the register.
Aside from the added cost and time implications required by smaller enterprises, there has been concern that they would be forced to disclose information that would be competitively sensitive.
Following intervention by Mr Reynolds, it now appears that the filing of accounts via third-party software providers will be scrapped and, according to the Financial Times, Mr Reynolds is considering whether the ban on submitting abridged accounts should also be dropped.
Craig Beaumont, executive director at the Federation of Small Businesses, welcomed the reversal, saying the episode had shown “what can happen when well-intended policy initiatives meet practical reality”.
He said the group still supported the intention of improving Companies House data and transparency but called the overhaul to filing requirements “anti-growth red tape”.
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