If you’ve been dreading the next round of Companies House reforms, here’s some good news: you’ve been handed an extra year to prepare. The changes originally due in April 2027 now come into effect from April 2028.

That said, more time doesn’t mean nothing to think about. These reforms, part of the Economic Crime and Corporate Transparency Act 2023 (ECCTA), change some fundamental things about how accounts are filed, and are worth understanding now rather than in a rush next spring.

What’s actually changing

From April 2028, small companies and micro entities will need to file a profit and loss account with Companies House, just as larger companies already do, a meaningful shift for many who’ve never had to disclose this level of detail before.

This is the statutory profit and loss account, not a fully detailed one: costs like directors’ salaries stay folded into broader figures such as staff costs or overheads, just as they already do in the accounts prepared for HMRC. What becomes visible is the overall shape, turnover, gross profit, overheads, bottom line, not a breakdown of every cost in the business.

Filing the profit and loss account with Companies House will be compulsory. Publishing it on the public register will not, provided you actively opt out, a decision and a process you’ll need to manage yourself rather than something that happens for you.

Why require this at all, given the opt-out? The government’s case, under ECCTA, is that holding this data at Companies House improves the quality of the register and helps authorities spot economic crime. Our principal accountant, Toni Hunter, questions that reasoning: HMRC already receives the same profit and loss information every year through your corporation tax return, tagged in iXBRL, so the fraud detection case is hard to follow when the data is already with the tax authorities. What the reform mainly changes is who else can draw on it through the Companies House register, not what government already knows.

Companies House has confirmed the opt-out will exist but hasn’t yet said how it will work. Several accountants are already sceptical of how robust the process will be, and worry P&L figures could be published by accident: a box not ticked, a system that doesn’t do what it’s supposed to.

Filing itself is changing too. As with Making Tax Digital, accounts will need to be filed using commercial software, in a format called iXBRL, and web and paper routes will close entirely, whether you file yourself or your accountant does it for you.

If you currently file your own accounts through the Companies House website, this is the part that will change your routine most. Companies House doesn’t provide its own software, and there’s no confirmed equivalent to the “bridging software” that lets Making Tax Digital users carry on with a spreadsheet. It will publish a list of approved software providers, and low-cost, accounts-only packages already exist for a modest fee. Worth looking into well before 2028, rather than discovering at the deadline that your usual route no longer works.

A few other changes are worth flagging:

• Abridged accounts are being phased out, so that simplified option won’t be available under the new rules.
• Shortening your accounting reference period will be possible fewer times than before.
• Audit exemption claims will need a stronger eligibility statement.
• All parts of your accounts and reports will need to be filed together, rather than piecemeal.

Companies House will write to every company at its registered email address to explain the changes and point to guidance, so nobody should be caught unaware.

Why this matters, even with the extra year

It’s easy to file this under “a 2028 problem” and move on, but the shift to software-only filing and the new profit and loss requirement aren’t things you want to figure out the week your accounts are due. Understanding now what will be visible on the public register, and what software you’ll need, means deciding calmly rather than under pressure.

For micro business owners trading through a limited company, this is worth weighing properly, not ticking through. Right now, your turnover and gross profit sit in your own records, seen only by you and your accountant. Once these reforms land, unless you opt out, they become visible to anyone who looks: a competitor pricing against you, a landlord assessing your business, a supplier deciding on credit terms, even an employee curious how things are really going. Decide on publication deliberately, not by default.

For some, it’s also worth asking a bigger question: whether a limited company is still the right vehicle at all, given the reporting that now comes with it. Just be careful what you wish for. Step outside a company and Companies House no longer applies, but Making Tax Digital does, on its own timetable for sole traders so escape one set of filing obligations and simply walk into another!

If you’d like a hand understanding how this affects your business, or want to get ahead of the new requirements rather than leave it to the last minute, give us a call. We’re happy to talk it through.