Respite in respect of loss of Audit Exemption, for non-group micro and small companies
Since 2020, in accordance with the Statutory Audit Act 2018, a single missed annual return deadline resulted in the loss of audit exemption, for the following two years of financial statements.
On 16 July 2025 Section 22 of the Companies (Corporate Governance, Enforcement and Regulatory Provisions) Act 2024 changed the application of the loss of audit exemption for late filing in respect of small and micro companies which are not part of a group.
The Companies Registration Office has provided the following announcement on their website:
“The commencement of Section 22 of the Companies (Corporate Governance, Enforcement and Regulatory Provisions) Act 2024 on 16 July 2025 provides for a change to the current audit exemption regime.
Late annual returns filed up to midnight on 15 July 2025 will require an audit for the following two annual returns.
Effective from midnight on 15 July 2025 audited financial statements are required if a company filed late twice in the last 5 years.
The 5-year reference period is effectively starting from midnight on 15 July 2025 for companies who are not currently filing audited accounts due to loss of audit exemption for late filing of annual returns preceding the enactment.”
How does this apply in practice?
The Companies Registration Office have clarified the position with an additional note, as follows:
“Auditors details must be completed if the company cannot claim audit exemption. Late annual returns filed up to midnight 12:00 AM on July 16th will require an audit for the following two annual returns. Effective from midnight 12:00 AM on July 16th audited financial statements are required if your company filed late twice in the last 5 years from midnight 12:00 AM on July 16th.
In effect, the slate is wiped clean for companies filing on or after 12:00 AM on July 16th.
Late Filings Fees
It is also important to note that the late filing of annual returns will still incur late filing fees.
District Court Application to extend filing deadline
The option to apply to the District Court for an extension to file a late annual return and retain audit exemption, still remains and can be used for both group and non-group entities.
For more information on this, reach out to Ossie Houghton, Partner on our Corporate Governance & Compliance team.
