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Enter turnover, balance sheet total and average number of employees in the Previous Year column.
Enter the same three figures in the Current Year column.
Select Calculate Now. The tool checks each year against the micro, small and medium limits and applies the two-out-of-three test.
Read the result: Entity Size shows the company's size category, and Accounting Standard shows the standard it can use.
Select Reset to clear the figures and check another company.
Turnover: revenue for the year, before expenses. If the accounting period is not 12 months, the turnover limit is adjusted pro rata, so check borderline results with your accountant.
Balance sheet total: total gross assets (fixed assets plus current assets). Do not deduct liabilities.
Average employees: the monthly average number of people employed under contracts of service during the year, not full-time equivalents.
A company falls into a size category when it meets at least two of the three limits for that category. The size must usually hold for two consecutive financial years before the company moves up or down a category.
Two-out-of-three rule: turnover, balance sheet total and employees are tested together. Meeting any two is enough.
Two-year rule: a company only changes category once it has met, or failed to meet, the limits for two years in a row. In its first financial year, a company qualifies on that year's figures alone.
Transitional rule for April 2025: for the first accounting period starting on or after 6 April 2025, the company can apply the new higher thresholds to the previous year's figures as well. Many companies can therefore drop a size category straight away rather than waiting two years.
A company has turnover of £1.2 million, a balance sheet total of £420,000 and 8 employees, with similar figures last year. Under the pre-April 2025 limits, only the employee test is met for micro, so the calculator returns small, with FRS 102 Section 1A. Under the new limits, the balance sheet (under £500,000) and employee tests are both met. For periods starting on or after 6 April 2025, the company is a micro-entity and can use FRS 105.
A company has turnover of £16 million, a balance sheet total of £7 million and 60 employees. It meets only one small limit (balance sheet), so it is not small. It meets all three medium limits, so it is medium-sized. It must use full FRS 102 and needs a statutory audit.
The thresholds below apply to accounting periods starting on or after 6 April 2025. The monetary limits rose by about 50%. The employee limits did not change.
| Size | Turnover (new) | Balance sheet total (new) | Employees | Turnover (before 6 Apr 2025) | Balance sheet (before 6 Apr 2025) |
|---|---|---|---|---|---|
| Micro-entity | up to £1m | up to £500,000 | up to 10 | up to £632,000 | up to £316,000 |
| Small | up to £15m | up to £7.5m | up to 50 | up to £10.2m | up to £5.1m |
| Medium | up to £54m | up to £27m | up to 250 | up to £36m | up to £18m |
| Large | above medium limits | above medium limits | above 250 | above £36m | above £18m |
The same thresholds apply to LLPs. Groups use similar limits, but a group cannot be a micro-entity.
Company size sets the options. The company's directors then choose which of the available standards to use.
| Size | Standards available | Audit | What is filed at Companies House |
|---|---|---|---|
| Micro-entity | FRS 105, FRS 102 Section 1A or full FRS 102 | Usually exempt | Balance sheet and limited notes |
| Small | FRS 102 Section 1A or full FRS 102 | Usually exempt | Balance sheet and notes (profit and loss can be left out) |
| Medium | Full FRS 102 (or FRS 101 / UK-adopted IFRS where eligible) | Required | Full accounts, with some strategic report exemptions |
| Large | Full FRS 102, FRS 101 or UK-adopted IFRS | Required | Full accounts |
The simplest standard, open only to micro-entities. It uses historical cost only, with no revaluations, no fair value accounting and no deferred tax. Disclosures are minimal. It is optional: a micro-entity can choose FRS 102 Section 1A instead, for example if lenders want fuller accounts or the company holds investment property at fair value.
FRS 102 with reduced disclosures for small companies. Recognition and measurement follow full FRS 102, so deferred tax, revaluations and fair value are all allowed or required. The accounts must still give a true and fair view.
The main UK GAAP standard for medium and large private companies. FRS 102 amendments from the Financial Reporting Council's periodic review apply to periods starting on or after 1 January 2026. The main changes are a new revenue recognition model and bringing most leases onto the balance sheet.
Some companies cannot use the small or micro regimes whatever their size. Common exclusions:
If any of these apply, use the tool's result as a guide only and confirm the position with an accountant.
AcoBloom prepares FRS 105, FRS 102 Section 1A and full FRS 102 accounts for UK accounting firms, with working papers ready for your review.
For periods starting on or after 6 April 2025, a micro-entity has turnover of no more than £1 million, a balance sheet total of no more than £500,000 and no more than 10 employees. It must meet at least two of the three.
A small company has turnover of no more than £15 million, a balance sheet total of no more than £7.5 million and no more than 50 employees, meeting at least two of the three.
No. FRS 105 is optional. A micro-entity can choose FRS 102 Section 1A or full FRS 102 instead.
Only if it also meets the micro-entity limits. A small company that is not a micro-entity uses FRS 102 Section 1A or full FRS 102.
Most small companies are exempt from statutory audit. Exceptions include companies in an ineligible group and cases where shareholders holding at least 10% of shares request an audit.
It is the company's gross assets: fixed assets plus current assets, before deducting any liabilities.
Add the number of people employed in each month of the financial year and divide by the number of months. Count people, not full-time equivalents.
They apply to financial years starting on or after 6 April 2025. A transitional rule lets companies apply the new limits to the previous year too, so they can move to a smaller category in the first year.
The calculator applies the limits for periods starting before 6 April 2025. For later periods, compare your figures with the new thresholds table on this page. A company that is small under the old limits may be a micro-entity under the new ones.
Yes. LLPs use the same micro, small and medium thresholds as companies.