FRS 105 vs FRS 102 §1A: which accounts to file

In short: A micro-entity can use FRS 105 — the simplest UK accounting standard, with minimal notes and no fair-value or revaluation. A slightly larger small company uses FRS 102 Section 1A, which needs more disclosure but gives a fuller picture. You qualify for a size band by meeting at least two of three tests (turnover, balance-sheet total, employees). The thresholds increased for accounting periods beginning on or after 6 April 2025 (GOV.UK company size limits).

Both regimes are part of your Company Tax Return. Taxley prepares either as iXBRL when you start your return — so the choice below is the main thing to get right.

What's the difference between FRS 105 and FRS 102 §1A?

FRS 105 is the simplest micro-entity standard, with minimal notes; FRS 102 §1A is the small-company standard, with fuller disclosures and options FRS 105 doesn't allow (such as fair-value/revaluation and deferred tax). Most very small companies use FRS 105.

What are the micro-entity (FRS 105) thresholds?

You're a micro-entity if you meet at least two of these:

Some companies can't use the micro-entity regime even if small enough — for example LLPs in some cases, charities, and companies in a group that prepares (or is part of) group accounts. Check your eligibility before choosing it.

What are the small-company (FRS 102 §1A) thresholds?

If you're above micro limits but still small, you meet at least two of:

How do I choose between them?

Choose FRS 105 if you qualify as a micro-entity and want the simplest possible accounts; choose FRS 102 §1A if you're above the micro limits, or you want fuller disclosures or fair-value accounting.

• Pick FRS 105 if you qualify as a micro-entity and want the simplest possible accounts. The trade-off: you can't revalue assets or use fair value, and the accounts show very little detail.
• Pick FRS 102 §1A if you're above the micro limits, or you're a micro-entity but want a fuller "true and fair" set of accounts — for example because a lender, investor or buyer will read them, or you hold property you want to carry at fair value.

A micro-entity isn't forced into FRS 105 — it can choose to "opt up" to FRS 102 §1A. It just can't go the other way once it's too big.

Can a property company use FRS 105?

If your company holds investment property and you want to carry it at fair value (market value) with gains shown, that's an FRS 102 §1A treatment — FRS 105 requires cost less depreciation instead. This is a frequent reason a small property company chooses FRS 102 §1A over FRS 105 — see our Corporation Tax for a property company guide for how a rental company is taxed.

Frequently asked questions

What's the simplest option?

FRS 105 micro-entity accounts — fewer notes, no fair value, no deferred tax. Just confirm you actually qualify and aren't in an excluded category.

Did the size thresholds change?

Yes — for accounting periods beginning on or after 6 April 2025 the micro and small thresholds increased (e.g. micro turnover from £632k to £1m; small turnover from £10.2m to £15m). Use the column that matches when your period began.

Can a micro-entity use FRS 102 §1A instead?

Yes. A micro-entity may choose the small-company regime for a fuller set of accounts. A small company that exceeds the micro limits cannot use FRS 105.

Do the accounts go to HMRC or Companies House?

Both, separately. HMRC receives them as part of your Company Tax Return (in iXBRL); Companies House receives your statutory accounts on the public register.

Taxley prepares both FRS 105 and FRS 102 §1A accounts as iXBRL. Which regime applies — and the right presentation of items like investment property — should be confirmed with a qualified accountant before you file.