The Companies Act 2006 has passed into law, but its full effects are yet to be felt. Certain measures were introduced immediately, but the remaining aspects of the legislation become effective on 6 April 2008, 1 October 2008 and 1 October 2009.

When the accounting period falls on a month-end, then the filing deadline will now be nine months (or six months for a Plc) afterwards and it will also fall on the month-end.  Previously, a company with an accounting period ending 28 February would have had to file its accounts by 28 December, although many people mistakenly thought it was 31 December. Under the new rules this will be a month earlier on 30 November, but under the old rules this would have been 28 November. This is more intuitive interpretation of the rules for the filing deadline. Beware though, that for the first period of account, and for accounting periods that do not end on a month end the rules must be checked, as the above will not apply in all cases.

For accounting periods starting on or after 6 April 2008 the following limits have been increased.

To be defined as a small company, a company must meet two out of the three following criteria for two years in succession:

            Turnover: Under £6.5M (previously £5.6M)

            Gross assets: Under £3.26M (previously £2.8M)

            Employees: Not more than 50 (no change)

To qualify as exempt from audit, a limited company must qualify as small and meet both the turnover and balance sheet totals (certain companies are still unable to take this exemption, e.g. Plc companies, banks, etc.)

To be defined as a medium-sized company, a company must meet two out of the three following criteria for two years in succession:

            Turnover: Under £25.9M (previously £22.8M)

            Gross assets: Under £12.9M (previously £11.4M)

            Employees: Not more than 250 (no change)

There are also revised gross limits for small and medium-sized groups of companies.  For the turnover and gross assets these are approximately 20% more, the employees remains the same.  Details can be obtained from your Barnes Roffe contact partner should you require them.

From 6 April 2008, private limited companies will be able to dispense with the role of Company Secretary. Beware that this might disqualify a shareholder who was previously the Company Secretary, but who did not work full time, from qualifying for the new Entrepreneurs Relief from Capital Gains Tax. See Topical Tip 111 for details.

However, before dispensing with this role, the Articles of Association must be checked to see if they require a Company Secretary. If they merely refer to Company Secretarial duties then this will not require a Company Secretary position to be maintained.

It remains possible to have a single Director company because previously this was only allowed if there was a different person as Company Secretary. However, a change coming from 1 October 2009 will require every company to have at least one Director who is a natural person, not a company, so this may need consideration in due course.