The government is still reviewing plans to tighten reporting requirements for small and micro companies, with ministers yet to decide whether to press ahead with rules that would require them to publish profit-and-loss accounts for the first time.
In an interview with The Times, Blair McDougall, the new small business minister, said that “all options are on the table” as officials weigh up the balance between tackling fraud and protecting small firms from unnecessary administrative burdens.
“There are obviously different arguments in terms of the impact on businesses of their exposure, particularly for SMEs, versus people who are worried about financial crime and everything else,” McDougall said. “We’re balancing that at the moment and discussing it.”
Under plans announced by Companies House in June, firms classified as “small” or “micro” would lose the right to file abbreviated accounts from April 2027. Instead, they would have to submit full profit-and-loss statements, revealing revenues and profits.
The move formed part of the Economic Crime and Corporate Transparency Act, designed to reduce fraud and improve the accuracy of information filed at Companies House. However, within days of the announcement, the Department for Business and Trade signalled a pause in the rollout amid concerns from business groups that the new rules would increase red tape and risk exposing commercially sensitive data.
If implemented, the reforms would affect companies with turnover below £10.2 million, balance sheets under £5.1 million, and fewer than 50 employees. They would also require all firms to file accounts digitally using commercial software, ending the use of paper and web-based submissions.
The proposals were first consulted on in 2019 and made law in 2023 under the previous Conservative government. Business groups have broadly supported greater transparency but warned that the changes could deter entrepreneurship by exposing small firms’ financial details to competitors.
McDougall, who became an MP in 2024 and took on his first ministerial role in September, said the government’s focus was on building business confidence and long-term growth rather than rushing through reforms.
He added that success would be judged by how well the government delivers on its Small Business Plan and industrial strategy, both launched earlier this year. “We’ve got a terrible history in government of publishing these PDFs that then gather dust,” he said.
McDougall spoke during International Trade Week at The Great British Pitch, an event organised by Small Business Britain that brought together entrepreneurs and international buyers. He said such initiatives were central to boosting the profile of British SMEs and driving export-led growth.
The final decision on the Companies House reforms is expected early next year, with officials indicating that ministers are still assessing the regulatory impact on smaller businesses before confirming the 2027 timetable.
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Government still weighing changes to small company filing rules, says business minister