Audit exemption thresholds

In most cases smaller companies do not need to have an annual statutory audit although the audit thresholds are always under review and these thresholds are overridden by other considerations in some circumstances.

What are the thresholds now?

The current criteria are:-

• Yearly turnover of more than £15 million
• Assets in excess of £7.5 million
• An average of 50 or more employees

When did the last audit exemption change take effect?

The audit exemption thresholds last changed back in April 2025. That means they were applied to companies for the financial year 2025-2026. In other words, affected companies still need a final statutory audit for the financial year 2024-2025. After that they are reclassified as a small company, probably not needing an audit.

Do all small companies get an audit exemption?

Most, but not all, small companies falling under the thresholds get an audit exemption.

However, it’s worth bearing in mind that some small companies still need auditing. These include companies whose articles of association mandate an audit. They also include firms who have been requested to have an audit by shareholders owning at least 10% of shares.

Certain types of business are also required to have an audit, regardless of size. You can find out more in our article Statutory audit: does my limited company need one?

Can I still audit my business if it is exempt?

Even if your company is exempt from audit, you may choose to have one anyway. This is known as a voluntary audit. Audits are a good way to get reassurance your financial statements are likely to be free from material misstatement. They also help you identify and manage risk. Some companies choose to have audits to help them sell on a business or a significant number of shares in it. You can find out more about the benefits of an audit in our article, Understanding the purpose of an audit.

Where can I learn more about audit requirements?

At THP, we have been providing audit services to medium sized companies since the 1980s. If you would like help determining whether you need a statutory audit, a member of our friendly audit team can help you. If you’d like to know how much an audit is likely to cost your business, our audit fee calculator is an invaluable resource. In addition, we’ve compiled a list of audit FAQs that provides you with answers to many questions about the auditing process.

If you do decide to undertake an audit with THP, you can rest assured that we are on the Register of Statutory Auditors. We can also supply you with testimonials from satisfied clients on request.