Year-End Accounting Checklist: Complete Guide for UK Limited Companies

Running a limited company in the UK means fulfilling important legal responsibilities. The end of your financial year is particularly significant, as you need to prepare accounts, file them with the correct authorities and ensure compliance with UK law. This comprehensive year-end accounting checklist keeps you organised and helps avoid costly mistakes that could result in penalties.

According to the latest Companies House statistics, there were 5.46 million companies on the UK register as of September 2025. With thousands of businesses needing to file annual accounts, having a proper end of the year accounting checklist has never been more important for maintaining compliance and avoiding penalties.

This guide takes you through everything you need to know about year-end returns for your limited company, from preparing accounts to understanding filing deadlines.

Key Takeaways

• All UK limited companies must file accounts annually with Companies House within 9 months of year end, regardless of whether they traded or made profit
• Late filing penalties start at £150 and increase to £1,500 if accounts are over 6 months late; penalties double for two consecutive late years
• Corporation tax is due 9 months and 1 day after your accounting period ends, with the tax return due within 12 months
• Proper record-keeping is essential – you must maintain business records for at least 6 years, with some records requiring 7 years
• First-time filers get 21 months from incorporation to submit their initial accounts to Companies House

Understanding Your Company’s Year End

Your company’s financial year end is the date when your accounting period closes. Many UK limited companies choose 31st March or 5th April to align with the tax year, though you can select any date that suits your business.

When you register with Companies House, you receive an automatic year-end date based on your incorporation date. You can change this date if needed by submitting the appropriate forms. Whether you operate as any limited company structure, these rules apply equally.

Important note: Your corporation tax accounting period usually matches your financial year but cannot exceed 12 months. If your accounting period is longer, you must split it for tax purposes.

What Records Must a Limited Company Keep?

Before examining the year-end accounts checklist, you should understand what records you must maintain throughout the year. UK law requires limited companies to keep detailed records for at least six years from the end of the relevant financial year.

Essential records include:

• All sales and income records (invoices, receipts, till rolls)
• Business expenses and purchases (supplier invoices, petty cash records)
• VAT records (if registered)
• Payroll records (employee details, wages, PAYE information)
• Bank statements and correspondence
• Asset records (equipment, property, vehicles)
• Stock records
• Details of money owed to and by the company

What records need to be kept for 7 years? Certain documents require longer retention periods:

• Payroll and employee information
• Pension scheme records
• Specific tax documents

Your Complete Year-End Accounting Checklist

Preparing your end of year accounts requires careful attention. Here is a comprehensive year-end accounts checklist to guide you through the process:

1. Gather All Financial Information

Before your accountant can prepare company accounts, collect the following:

• All bank statements for the complete financial year
• Credit card statements
• Receipts and invoices for business expenses
• Sales invoices and income records
• Payroll summaries
• VAT returns (if applicable)
• Asset purchase records
• Loan agreements and statements

2. Reconcile Your Bank Accounts

Match every transaction in your accounting software (such as Xero, Sage, or QuickBooks) with your bank statements. This ensures accuracy and helps identify missing transactions or errors.

3. Review Outstanding Invoices

Check both:

• Debtors: Money customers owe you (accounts receivable)
• Creditors: Money you owe suppliers (accounts payable)

Ensure these figures are accurate, as they directly affect your year-end accounts.

4. Complete Stock Takes

If you hold physical stock, conduct a thorough stock take. Count everything and value it at cost or market value, whichever is lower. This figure appears on your balance sheet.

5. Review Fixed Assets

List all business assets such as equipment, vehicles and property. Calculate depreciation for each item based on your accounting policy. Remove any assets you sold or scrapped during the year.

6. Handle Prepayments and Accruals

Prepayments are expenses paid in advance, such as insurance covering the next financial year. Accruals are expenses incurred but not yet paid, such as outstanding utility bills. Both require adjustment to ensure your accounts reflect the true financial position.

7. Review Payroll and PAYE

Ensure all employee payments, PAYE submissions and National Insurance contributions are current. Reconcile your payroll records with your accounts.

What Accounts Need to Be Closed at Year End?

In accounting terms, “closing accounts” means finalising your profit and loss account and transferring the net profit or loss to your balance sheet. This process resets your income and expense accounts to zero, ready for the new financial year.

The accounts that require closing include:

• All income accounts (sales, interest received, other revenue)
• All expense accounts (wages, rent, utilities, supplies)
• Cost of goods sold

Your balance sheet accounts (assets, liabilities and equity) carry forward to the next year and remain open.

Preparing Your Limited Company Accounts

Once you complete your year-end accounting checklist, you or your accountant can prepare your statutory accounts. These comprise:

1. Balance Sheet: Shows what your company owns (assets) and owes (liabilities) on the year-end date
2. Profit and Loss Account: Shows income and expenses for the complete year
3. Notes to the Accounts: Provides additional detail and explanations
4. Director’s Report: Describes the company’s activities and performance

Small companies can file micro-entity or small company accounts with less detail, simplifying the process.

Filing Deadlines and Requirements

Understanding company accounts filing deadlines is essential to avoid penalties.

Example: If your year end is 31st March 2025:

• File accounts with Companies House by 31st December 2025
• Pay corporation tax by 1st January 2026
• File CT600 with HMRC by 31st March 2026

First Company Accounts

Your first company accounts follow different rules. You receive 21 months from incorporation to file your first accounts with Companies House, though your corporation tax remains due 9 months and 1 day after your accounting period ends.

Filing Your Accounts: Step by Step

Filing with Companies House

You must file your limited company accounts electronically through:

• Companies House WebFiling service (free)
• Software compatible with Companies House
• Your accountant’s software

Even if you make no profit, you must still file accounts. Accounts must still be filed even if the company did not trade.

Submitting to HMRC

Your annual accounts to HMRC must include:

• Your complete statutory accounts
• Tax computations showing how you calculated corporation tax
• The completed CT600 form

File these through HMRC’s online service. If you use accounting software, you may be able to file corporation tax directly through platforms like Xero.

Year End Tax Planning

Effective year-end tax planning can reduce your corporation tax bill legally. Consider:

• Timing of expenses: Bring forward allowable expenses into the current year
• Capital allowances: Claim tax relief on equipment and vehicles
• Directors’ remuneration: Balance salary and dividends efficiently
• Pension contributions: Company pension payments are tax-deductible
• Research and development credits: Claim if you are developing new products or processes

Discuss these options with your accountant well before your year end.

What Does the Accountant Need for Year End?

To prepare your end of year accounts, your accountant will request:

1. Complete accounting records for the year
2. Bank reconciliations and statements
3. Details of any personal expenses paid through the business
4. Asset purchases and disposals
5. Loan agreements and finance documents
6. Details of shareholders and share transactions
7. Minutes of any director or shareholder meetings
8. VAT returns and supporting documentation

Professional tip: Maintain organised records throughout the year. Use cloud accounting software and photograph receipts immediately. This makes the year-end process considerably smoother.

Common Mistakes to Avoid

Many businesses encounter challenges with their business end of year processes. Here are pitfalls to avoid:

• Missing the filing accounts deadline: Set reminders well in advance
• Incomplete records: Missing bank statements or receipts cause delays
• Failing to separate personal and business expenses: Keep them clearly separate
• Forgetting depreciation: Assets lose value over time
• Ignoring small transactions: Every expense and income matters
• Last-minute preparation: Start gathering information weeks before your year end

Using Technology to Simplify Year End

Modern accounting software makes managing your accounts throughout the year considerably easier. Platforms such as Xero automatically categorise transactions, reconcile bank feeds and calculate VAT.

This means when you reach your year end, most work is already complete. Your accountant can access your records remotely and prepare your accounts efficiently. Many software solutions also offer end of year accounts templates that help structure your financial information correctly, ensuring compliance with UK accounting standards.

Cloud-based systems also provide real-time visibility of your financial position, making it easier to plan for corporation tax payments and identify potential issues before they become problems.

How to Submit Company Accounts to HMRC?

Submitting company accounts to HMRC requires the following steps:

1. Prepare your statutory accounts and tax computations
2. Complete the CT600 corporation tax return form
3. Register for HMRC’s online services if you have not already done so
4. Log in to your HMRC account
5. Submit your return electronically through the online filing service
6. Pay any corporation tax due by the deadline (9 months and 1 day after year end)

Most accountants handle this process on your behalf, though you can file directly if you prefer. Using accounting software that integrates with HMRC, such as Xero’s corporation tax functionality, can simplify the submission process.

Conclusion

Preparing year-end accounts for your limited company need not be stressful. With proper planning, organised records and this end of the year accounting checklist, you can ensure compliance and avoid penalties.

Begin preparation early, maintain accurate records throughout the year, and consider professional assistance from qualified accountants. The investment in proper accounting pays for itself through tax efficiency, peace of mind and legal compliance.

Remember, your filing accounts deadline arrives quickly. Mark it in your calendar, set reminders and begin gathering information well before it arrives. Proper preparation prevents problems and ensures your limited companies accounts meet all legal requirements on time.

Frequently Asked Questions

How long does it take to prepare year-end accounts?

For straightforward limited companies with well-maintained records, professional accountants typically require 2-4 weeks. However, incomplete or disorganised records can extend this considerably, so begin at least two months before your filing deadline.

Can I file my own company accounts?

Yes, you can legally prepare and file your own accounts. However, most directors use accountants because accounts must follow UK standards, tax calculations are complex and professional advice often saves more than it costs.

What happens if I miss the filing deadline?

Companies House automatically charges penalties for late filing: £150 (up to 1 month late), £375 (1-3 months), £750 (3-6 months) and £1,500 (over 6 months). HMRC charges separate penalties for late corporation tax returns starting at £100. If accounts are late two years running, Companies House penalties automatically double.

Do I need to file accounts if my company made no money?

Yes. All active limited companies must file accounts and a corporation tax return annually, regardless of whether they traded or made profit. The only exception is if you formally dissolve the company.

What is the difference between accounts for Companies House and HMRC?

Companies House receives your statutory accounts (balance sheet and profit and loss). HMRC receives these plus additional tax computations and the CT600 form showing your corporation tax calculation.

Can I change my company year end?

Yes, you can shorten or extend your accounting period by filing form AA01 with Companies House. However, you can only extend once every five years and your accounting period cannot exceed 18 months.