From July 16, 2025 changes in the audit exemption regime for companies is to be welcomed as it has become more forgiving for SMEs.
Section 22 of the Companies (Corporate Governance, Enforcement and Regulatory Provisions) Act 2024 introduces a key change:
Old Rule:
A single late annual return meant an automatic loss of audit exemption for the following two years.
New Rule:
Now, SME companies will only lose the audit exemption after a second late filing within a 5-year period—a change we in small business have been requesting, for years.
Why This Matters:
This change reduces the administrative & financial burdens caused by one-off filing delays. SME Companies will no longer face the increased costs of audited accounts for a single error.
When does it begin?
Section 363 of the Companies Act 2014 is replaced by Section 22 of the 2024 Act. Effective July 16, 2025, Section 22 of the Companies (Corporate Governance, Enforcement and Regulatory Provisions) Act 2024.
The CORE SYSTEM in the Companies Registration Office (CRO) will be updated to reflect this.
MF 22/07/25.
