Not every UK limited company needs a statutory audit. Many smaller companies qualify for audit exemption, but it is important to understand the rules, as an audit may still be required in certain situations.
For financial years starting on or after 6 April 2025, a company is generally audit exempt if it qualifies as a small company and meets at least two of the following conditions:
- Annual turnover of no more than £15 million
- Balance sheet total (gross assets) of no more than £7.5 million
- Average number of employees of no more than 50
If a company exceeds these limits, it will not usually lose audit exemption straight away. In most cases, the company must exceed the thresholds for two consecutive financial years before the exemption is lost.
However, some companies must have an audit regardless of size. This includes public companies and certain regulated businesses, such as banks, insurance companies, and some investment firms.
An audit may also be required if the company’s shareholders request one. Shareholders holding at least 10% of any class of shares, or 10% of voting rights, or 10% in number of members, can demand an audit. This request must be made in writing and received at least one month before the end of the financial year.
Charitable companies are subject to different rules and often face lower thresholds for mandatory audits. For example, a charity may require an audit once its gross income exceeds £1 million, depending on its circumstances.
If you are unsure whether your company needs an audit, or whether an audit could be beneficial for lenders, investors, or business planning, please get in touch and we will be happy to review your position.
Source:Other | 25-01-2026
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I'm Aitch, the Founder and CEO of CIGMA Accounting Ltd. As a Chartered Management Accountant and as a CIMA member, I've spent more than 16 years helping businesses, entrepreneurs, landlords, and individuals with tax planning, accounting, and HMRC compliance. As a chartered accountant in London, I'm passionate about making complex tax matters easier to understand and helping clients make confident financial decisions.
Over the years, I've advised start-ups, SMEs, established companies, and high-net-worth individuals across a wide range of tax and accounting matters. My expertise includes Corporation Tax, Self-Assessment, Capital Gains Tax, Inheritance Tax planning, R&D tax relief, capital allowances, international tax, and resolving complex HMRC compliance issues. Whether clients need a business accountant, tax accountant, or strategic tax advisor, my focus is always on delivering practical advice that creates long-term value.
One of my specialist areas is Making Tax Digital (MTD). I've worked extensively with businesses preparing HMRC's digital reporting requirements, helping them move to cloud accounting, improve financial processes, and adopt technology that makes compliance more efficient. I regularly speak at Making Tax Digital roadshows, industry events, and educational sessions in collaboration with Zoho Books, sharing practical insights into digital accounting, tax legislation, and the future of the profession.
Many business owners looking for the best accounting firm in London are not simply searching for an accountant they're looking for trusted advice, responsive support, and long-term value. That's the approach I've taken in building CIGMA Accounting. My team and I work closely with businesses across London and the UK, providing accounting services, tax advisory, bookkeeping, payroll, VAT, company accounts, and strategic tax planning tailored to each client's goals.
Through this website, I share practical guidance on UK taxation, Making Tax Digital, HMRC updates, Corporation Tax, Self-Assessment, and business finance. My aim is to provide reliable, straightforward information that helps business owners understand changing regulations, reduce compliance risks, and make informed financial decisions with confidence.
