Changes to company size thresholds – how will they impact your business?

A new and improved way to define company size.

In April 2025, the financial thresholds that define whether a business is classed as micro, small, medium or large changed.

The UK government plans to raise the limits for turnover and balance sheet totals. This means some companies will move into a smaller category. The idea is twofold –

1. To cut down the admin burden for many businesses

2. To reflect how the economy has shifted since the rules were last updated in 2008.

But what will it mean for your business?

To be classed as a small company under the new rules, you’ll need to meet at least two of the following:

Criteria	Before the change	Since change in April 25
Turnover	£10.2 million or less	£15 million or less
Balance Sheet Total	£5.1 million or less	£7.5 million or less
Number of employees	50 or fewer	No change

Similar increases will apply to other company size bands, including micro and medium-sized firms.

What this could mean for your business

If your figures put you close to one of the existing thresholds, the changes could shift your classification. That might bring real benefits:

Easier reporting – especially for directors and small finance teams

Audit exemptions – fewer businesses will be required to have a statutory audit

Simplified accounts – more companies will qualify to use the small companies’ regime

Lower admin costs – less time and money spent on compliance

What to watch for

While this will be good news for many, there are a few things to keep in mind:

One good year could push you back over – it’s worth thinking ahead if you’re growing quickly

Audit exemptions aren’t always the right move – your bank or stakeholders might still expect audited accounts

Groups must look at the bigger picture – if you’re part of a wider group, thresholds may need to be assessed across all entities

What to do now

If you’re unsure where your business stands, or whether these changes will affect you, now’s the time to act.

– Plan now for how this may affect your reporting and filing from April 2025

– Review your latest turnover, balance sheet and headcount figures

– Talk to your accountant about how these changes apply to you

How we help

At Dux Advisory, we keep our clients one step ahead of change. We’ll help you understand where your business stands with the new thresholds and what action – if any – you should take.

Maybe you’ll decide to reduce reporting, explore audit options, or restructure your business. Whatever your position, we’ll guide you through the whole process.

Get in touch today. Let’s have a chat and explore what the new company thresholds mean for your business.