What the 2028 Companies House Changes Mean for SMEs
FIS Members, (particularly small and medium sized enterprises (SMEs), should start preparing now for a significant shift in Companies House reporting rules. While much of the focus has been on digitalisation, the more immediate issue for many businesses is how to avoid unintentionally putting sensitive financial information into the public domain.
From April 2028, small companies and micro‑entities will, for the first time, be required to file a profit and loss account with Companies House as part of their annual accounts. At the same time, all companies will have to move to fully digital filing using commercial software, with web and paper submissions withdrawn.
These changes sit within a wider package of reforms under the Economic Crime and Corporate Transparency Act 2023, intended to improve the quality and usability of financial information on the public register and strengthen the UK’s ability to tackle economic crime.
The key point: your profit and loss account may be exposed unless you act
Although companies will be required to submit their profit and loss account, the government has confirmed an important concession: SMEs will still be able to prevent that information from being made public.
This effectively creates a two‑tier system in which:
- Companies House and enforcement bodies receive full financial data, including the profit and loss account,
- But the public version of the accounts can exclude that information, if the company chooses to opt out.
It is important to note, however, that this protection will not be automatic.
The detail that should concern SMEs is that the opt‑out process itself has not yet been defined. Companies House has confirmed that the option will exist, but not how it will operate in practice.
Why you should consider opting out
For many SMEs, profit and loss accounts contain some of the most commercially sensitive information in the business that could allow interogation of margins, cost structures, and performance trends that could materially affect relationships with competitors, clients and suppliers.
Historically, smaller companies have been able to limit what they disclose publicly. These reforms change that balance by requiring full submission of the data, even if publication can be controlled.
The move to mandatory digital filing (iXBRL through commercial software) reinforces the likelihood that the opt‑out will be embedded somewhere in the submission process, potentially as a selection, declaration or tagging choice within the software itself.
That means the responsibility for protecting sensitive information is likely to sit not just with the company in principle, but with whoever is actually preparing and submitting the accounts in practice.
The practical implication: doing nothing may mean disclosure
While full procedural detail is still to come, the direction of travel is clear enough for SMEs to act now.
It would be unsafe to assume that:
- Non‑publication will be the default, or
- The opt‑out will be applied automatically by software or advisers
Instead, the prudent assumption is that opting out will require a conscious, positive step at the point of filing.
If that step is missed, whether through misunderstanding, process gaps or simple oversight, the profit and loss account could be published, with limited scope to reverse the situation once the information is in the public domain.
What SMEs should do now
Even without final guidance, there are some immediate, practical steps businesses can take to protect themselves.
First, SMEs should ensure that whoever is responsible for preparing and filing their accounts—whether an external accountant or an internal finance function, is fully aware that protecting the profit and loss account will require active management under the new regime.
Second, this issue should be built into normal financial processes. It should not be left as an ad hoc decision at filing stage, but treated as a standard instruction and checklist item within the year‑end accounts process.
Finally, businesses should keep a close eye on further announcements. The detail of the opt‑out mechanism is still awaited, and will ultimately determine exactly how the risk needs to be managed in practice. FIS will continue to work closely with Institute of Chartered Accountants England and Wales (ICAEW) on this and will provide further guidance as soon as this becomes clear.
Key Takeaway
For SMEs, the immediate takeaway is:
From 2028, you will have to file more financial information than before, but whether that information becomes public will depend on whether you (or your agent) take the right action at the right moment.
Getting that step right will be essential to protecting commercially sensitive financial data in the new reporting landscape.