Statutory Requirements in the United Kingdom You Need to Be Aware of And May Apply to Your Business

There are a number of statutory requirements you need to comply with when running a company in the UK. These requirements are defined in the different Companies Acts plus in any regulation  handed down to HMRC from the UK Treasury. The following section provides an overview of the most important rules:

Financial Year & Filing Dates

• The financial year of the company is counted from the month of incorporation.
• The company needs to file year-end accounts (financial statements) with the register of companies (Companies House) 10 months after the end of the financial year.
• The company needs to file a company tax return 12 months after the end of the financial year.
• Any outstanding company tax needs to be paid nine months after the end of the financial year.
• Once a year the company needs to file a so-called 'Annual Return' that reports any changes in the particulars of the company such as new shareholders.

Regulations in Relation to Company Directors

• The company is not allowed to give loans to a director.
• Directors are not allowed to make drawings from the company other than salary and dividends.
• There are a few countries, in which your UK company may be subject to taxation as well, if you live in the given country but manage your company in the UK.  We can advise you on whether this is the case but tax specifics will need to be dealt with by a tax adviser in your country.

Audit Exemptions

Small companies are exempt from the audit requirement. This means their financial statements and tax returns do not need to be examined by chartered auditors. To be considered as a small company, at least two of the following criteria must be met:

• annual turnover must be £5.6 million or less;
• the balance sheet total must be £2.8 million or less;
• the average number of employees must be 50 or fewer.