Your Profit & Loss Account Has a New Fan
For years, many small business owners have enjoyed a simple arrangement. The balance sheet went to Companies House, the tax return went to HMRC, and the Profit & Loss account stayed safely out of sight.
Not anymore.
Under the Economic Crime and Corporate Transparency Act, small and micro companies will need to submit their Profit & Loss account to Companies House as part of their annual filing.
Before you start worrying about competitors analysing your profits over their morning coffee, there's some good news. Although Companies House will receive the information, the current plan is that it won't be available for public inspection.
So while Companies House gets a backstage pass, everyone else remains in the audience.
The change is part of the government's wider effort to tackle economic crime and improve transparency. By collecting more detailed information, Companies House will be better equipped to spot suspicious activity and companies that don't quite pass the sniff test.
For most businesses, the impact should be modest. Your accountant is probably preparing these figures already. The only difference is that Companies House now gets a copy too.
It's another sign that Companies House is no longer content with collecting paperwork. It has started reading it.