Small company P&L filing at Companies House is delayed, thankfully

Fraud-conscious Companies House might be making headlines for removing 11,000 companies from the register, including one registered address that, on paper, apparently had 5,000 businesses trading from it.

But here, exclusively for ContractorUK, I want to focus on something that Companies House is not doing, writes Helen Christopher, founder of accountancy and financial growth advisory Beansprout Consultancy.

Relief for small companies, even if Companies House comms are yet to confirm

The government has decided not to proceed with the key element of the Companies House reforms that were due to apply from April 2027.

The delay is likely to come as a significant relief to many contractors and “small company” directors.

At the time of writing, official communications from Companies House do not appear to reflect the policy pause affecting companies defined as “small.”

On hold: Profit and Loss (P&L) filing requirement for small/micro company directors

But it is now widely acknowledged that the central plank of the Companies House 2027 reforms -- requiring small and micro-entities to file detailed Profit and Loss (P&L) accounts-- has been put on hold indefinitely.

Or at least, it’s on hold for as long as Business Secretary Jonathan Reynolds remains in post, as a “government source” quoted by a broadsheet claimed Mr Reynolds isn’t currently supportive of the reform.

Does transparency matter in cleaning up the Companies House register?

My take is that transparency is vital to effectively fight economic crime.

But the proposed Companies House reform to stop small companies from being able to file “abridged accounts” would have had unintended, adverse consequences for small businesses.

That’s why, despite the confusion caused by mixed messaging (that Companies House should now probably get on top of), we believe that this policy delay is a positive step for contractors and other owner-managed businesses.

Three Companies House reforms

Under the Economic Crime and Corporate Transparency Act (ECCTA) passed in 2023, the previous government sought to overhaul the Companies House filing process to improve accuracy, fight fraud, and enhance trust in corporate data.

The previous government’s proposed changes included:

1. Mandatory electronic filing using iXBR-compliant software;
2. Abolishing paper submissions, and;
3. Requiring all companies, including the smallest companies, to file full profit and loss accounts.

These Companies House reforms were designed with good intentions -- to clean up the register, reduce financial crime, and ensure reliable business information.

But the proposals created significant concern among small business owners and industry bodies.

P&L prude: Keep your company’s numbers close to your chest

It’s important to highlight that sharing detailed Profit & Loss (P&L) figures publicly can put small businesses at a disadvantage.

Unlike large companies with PR and legal teams, small firms can’t always control how financial information is interpreted or used. Competitors might analyse margins, pricing, or profitability. Customers might use that data to push for discounts.

That’s why, as a leading advisory firm in this space, we wouldn’t recommend that any small business voluntarily publishes more information than they’re legally required to.

It’s also why many limited company directors were right to be concerned at the Companies House plan to make them share more details in their public accounts.

Why the U-turn on a new Companies House P&L filing policy?

Whether or not the current Labour government agree with our reasons for not wanting to publish detailed profit and loss figures for the smallest companies, they are focused on reducing red tape and stimulating growth.

The Department for Business and Trade has committed to cutting regulatory burdens by 25%.

And this informal halt to “small companies” having to publish P&L accounts is a step in that less arduous direction.

What negatives would forcing small companies to file a P&L bring?

The Companies House reform of forcing the UK’s smallest companies to publish more complicated financial information, while well-meaning, would have:

• Increased software costs and accountancy fees for small firms;
• Exposed sensitive data to competitors and customers;
• Reduced the negotiating power of small suppliers, and;
• Added complexity to filing obligations.

By shelving this P&L requirement, the government has acted in the interests of small businesses, giving company-owners room to focus on growth rather than bureaucracy.

What Companies House reforms are still going ahead from April 2027?

It’s important to understand that while the P&L requirement is off the table -- for now, other aspects of the ECCTA reforms still appear to be moving forward.

Most notably, and with effect from April 2027:

• All companies must file electronically using compliant software (iXBRL);
• Paper filings will no longer be accepted, and;
• Non-compliance could lead to penalties and late-filing fees.

These Companies House reforms aim to improve the reliability and timeliness of the companies register.

Mistakes, delays, or informal methods of filing will no longer be tolerated.

Therefore, your limited company’s accounts must be complete, accurate, and digitally submitted on time.

Do things right on Companies House, and you’ve got nothing to fear

If your business has always taken compliance seriously, there's nothing to significantly worry about with these Companies House reforms.

In fact, this is a moment to be proud of how you run things!

With more scrutiny on the accuracy and quality of submissions, doing the right thing pays off not just in avoiding penalties, but in showing professionalism to lenders, partners, and potential investors.

Companies House Reforms: shelved in part, but not scrapped, so filing is still going digital

Our final messages to small and other affected companies are straightforward.

In light of these Companies House reforms, we say:

• Don’t panic about the P&L requirement -- it’s been shelved (for now).
• Stay alert to changes -- but don’t second-guess Companies House messages just yet!
• Keep your records tidy, your software compliant, and your filing timely.

TLDR: Companies House reforms like mandatory P&L filing for contractors be like…

In summary, the delay to the Companies House Profit and Loss filing requirement for small companies and micro-entities is a welcome relief for owner-managers, including contractor-directors. It lifts an unnecessary burden and protects your sensitive financial data. But don’t mistake this as a step back on modernisation; Companies House is still moving ahead with digital reform and closer scrutiny.