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Increase to company thresholds

Thresholds based on a company’s accounts and employee numbers determine whether a company is categorised as small or not. Being able to qualify as a small or medium-sized business can cut red tape for a business with a reduced amount of both non-financial and financial reporting a small or medium-sized business is required to do.

The Prime Minister, Rishi Sunak, has announced that there will be 50% uplift to the current thresholds that determine a company’s size. The government expects that this will benefit up to 132,000 businesses. The current thresholds were set by the EU, who recently uplifted its thresholds by 25%. However, following Brexit, the UK has greater freedom to set its own thresholds and so is opting for a larger increase. It is intended that the new thresholds will apply to financial years that start on or after 1 October 2024.
The new thresholds mean that a small company will be one with turnover less than £15m, and the upper medium threshold will increase to £54m. Companies with a turnover above £54m will be classified as large.

If you want to know how these changes might affect your company, please call us and we will be happy to help you.