From 1 April 2027, all companies will need to file their annual accounts using commercial software. This means Companies House will be closing their web and paper-based systems for account filings on that date.
Whether a company file accounts themselves or through an accountant, they’ll need to use dedicated software from April 2027
Companies House are communicating with those required to submit annual accounts to give them plenty of time to prepare for the change – effectively companies have one full accounting year, plus 8 months from now, to make the switch (a total of 20 months). Many larger companies or those that employ larger accountancy firms may already file accounts using software and won’t need to take any action.
So what’s changing?
Year End Accounts must be filed digitally from April 2027 using software.
Profit and loss accounts will be required for small and micro-entity companies.
Other changes planned include updates to audit exemptions and accounting reference periods – Companies House will be sharing more information about these changes in the coming months.
Why are these changes happening?
These changes are being introduced as part of a broader reform package under the Economic Crime and Corporate Transparency Act 2023. The move to software filing is seen as a critical step in improving the accuracy and quality of data on the register by reducing errors and formatting issues. It will also speed up processing times through the use of automation and technology as we move into an ever-growing digital era.
Companies, whilst some disruption is likely initially, will benefit from the streamlined filing process by having more internal control and a more secure way to submit their accounts compared to paper filings which can be incorrectly uploaded or be rejected for many reasons including omitted date or incorrectly formatted data.
The changes are also designed to help Companies House detect and prevent fraud more effectively.
Making basic profit and loss information available on the register aims to improve conditions for accessing credit, including trade credit lending, as well as helping to provide confidence/accurate data for those who want to do business with a company. It will also reduce the risk of deliberate misuse of minimal disclosure options to hide money laundering and other fraudulent activity.
More information is available at https://www.gov.uk/guidance/using-software-to-file-your-companys-information
Finsec recommend business owners speak to their accountant or software provider to make sure they ready for the changes