Why do annual accounts need to be prepared?

HMRC require all businesses to prepare annual accounts to support the information on personal and corporate tax returns which have to be submitted to them.

Normally preparation of a profit & loss account and a balance sheet is required.

Limited Companies must prepare a full set of statutory financial statements by law. Primarily, this is required for shareholders however, sometimes third parties will also request copies of these accounts.

Limited Companies must submit statutory financial statements to Companies House. Depending on the size of the limited company it is often possible to submit Abbreviated Accounts so as to minimise financial information disclosure.

Limited Liability Partnerships (more commonly known as LLP’s) must prepare a full set of statutory financial statements. These are primarily for the partners use but may be requested by other third partners.

LLP’s must submit financial statements to Companies House. Dependant on the size of the business it is often possible to submit Abbreviated Accounts to minimise financial information disclosure.

In some cases other third parties may require copies of Annual Accounts e.g. lenders.

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