What’s the Difference Between a Confirmation Statement and an Annual Account?

Undoubtedly one of the most common queries that we get here at Companies MadeSimple is about what the difference between two very important filing obligations are for a limited company. These are Confirmation Statements and Annual Accounts.

Both are very significant documents that you are required by law to file, so it’s very important that you know exactly what the difference is between the two. This blog will tell you all you need to know about both documents and, significantly, the differences between the two.

Here at Companies MadeSimple we understand the importance of supporting your business at its early stages. For more information on what we can do for your business see here. 

Key Takeaways

• A Confirmation Statement is a document that captures a snapshot of your company’s details. It includes information about directors, PSCs, business addresses, and share capital. This must be filed every year, within 28 days of the due date.
• Annual Accounts, on the other hand, focus on your company’s financial performance. These reports cover things like profit, loss, balance sheets, and any outstanding debts. Even if your company isn’t trading, these accounts must be filed annually.
• The main difference between the two is that a Confirmation Statement is an overview of your company’s structure, while Annual Accounts dive into its financial health.
• Both documents are legally required but serve different purposes.
• Both the Confirmation Statement and Annual Accounts need to be filed every 12 months, but the first set of Annual Accounts must be submitted no later than 21 months after your company is formed.
• If your company is dormant, you'll still need to file Dormant Company Accounts, which are simplified versions of Annual Accounts that show the company hasn’t been active.
• If you don’t file a Confirmation Statement, Companies House could strike your company off their register. Failing to submit Annual Accounts can lead to fines or penalties.
• Both documents can be filed by yourself, with the help of an accountant, or through a service like Companies MadeSimple.

What is a Confirmation Statement?

• Essentially it is a snapshot of your company’s information and its overall make up.
• So it will contain the general information on your directors, PSCs and also their business addresses.
• It will also contain the information on the company’s shareholding and its overall share capital.
• It must be filed every 12 months – even if your company isn’t currently trading.
• You must file your Confirmation Statement within 28 days of your due date.
• If a Confirmation Statement is not filed Companies House will simply strike your company off their register.
• Limited company Confirmation Statements can be done in a few ways: You can do it by yourself, with the help of an accountant, or we can do it for you. See our various Confirmation Statement services here for more information.

What is an Annual Account?

• This looks at different factors of your company.
• Rather than assessing your company’s initial information Annual Accounts instead take a closer look at your company’s financial records.
• Typical Annual Accounts will contain key information such as profit and losses; a directors report; an auditor’s report and some kind of balance sheet detailing the business assets or any debts that it might have to pay.
• Annual Accounts must be filed at least once every 12 months – even if your company is not trading.
• If your company is dormant/non trading then you have to file something called Dormant Company Accounts. This is something we offer – see here for more information
• A company’s first set of accounts should be delivered no later than 21 months after formation
• It also needs to go to HMRC as a part of your Self Assessment tax return.

The Key Differences

So whilst both of these documents are often confused, ultimately both are very different. For example a confirmation statement is a screenshot of your company whilst annual accounts look more at how your company has been performing.

Think of the Confirmation Statement as something that looks at the surface of your company, whilst accounts are purely financial. Both compliment each other in the sense that bodies (such as HMRC and Companies House) want to know firstly who are your company’s directors and how the company has performed over the stated period of time.

We hope that this has cleared up any confusion that you may have had regarding this. If you are interested, we can help you file your Confirmation Statement – see here for more information.

FAQs

What is the difference between an Annual Return and an Annual Account?

An Annual Return (now called a Confirmation Statement) is a snapshot of your company’s key information, including directors, shareholders, and business addresses. In contrast, Annual Accounts focus on the financial performance of the company, such as profit, loss, and balance sheets. Both are mandatory filings but serve different purposes.

Do I need to file both a Confirmation Statement and Annual Accounts?

Yes, both documents are required by law. The Confirmation Statement updates Companies House with the current details of your company, while Annual Accounts provide a financial summary of how the business has performed during the year. Both must be filed annually.

How often do I need to file a Confirmation Statement?

A Confirmation Statement must be filed every 12 months, with a due date set for the anniversary of your company’s incorporation. You must file it within 28 days of the due date to ensure your company’s details are kept up to date with Companies House.

What information is included in a Confirmation Statement?

The Confirmation Statement includes details such as your company’s directors, Persons with Significant Control (PSCs), shareholding, and the registered office address. It’s essentially a summary of your company’s structure and ownership.

What is included in Annual Accounts?

Annual Accounts include a detailed financial report, including profit and loss, a balance sheet showing assets and liabilities, and an auditor's report (if applicable). These documents give a detailed picture of your company’s financial health over the past year.

What happens if I don’t file my Confirmation Statement or Annual Accounts on time?

Failure to file either document on time can result in penalties. If you don’t file your Confirmation Statement, Companies House may strike your company off the register. For late Annual Accounts, you could face fines and, in extreme cases, your company could be dissolved.

Can my company file Dormant Accounts if it's not trading?

Yes, if your company is dormant (not trading), you must still file Dormant Company Accounts. These are simpler accounts that confirm your company has had no financial activity during the year.

How do I file my Confirmation Statement and Annual Accounts?

You can file both documents directly with Companies House online, or you can use an accountant or company formation service to assist with the process. If you need help, services like Companies MadeSimple offer options for filing these documents on your behalf.