Jurisdiction(s):
United Kingdom

Key definition

Small company definition

What does Small company mean? In practice, a small company is one that qualifies for the small companies regime for accounts, reporting and audit. The term is statutory in the UK: Companies Act 2006, s 382 sets financial size thresholds and s 384 lists exclusions. A company qualifies in a financial year if it meets at least two of the following (as amended, including the 2024 threshold uplifts): turnover not more than £15 million; balance sheet total (the aggregate of assets per the balance sheet) not more than £7.5 million; no more than 50 employees. Movement into or out of the regime generally follows a...

Corporation tax treatment of company distributions received by non-small companies (UK): exempt classes, anti-avoidance, election out, and comparison with small company regime

Published by a LexisNexis Tax expert

Practice notes

Where a company, within the charge to corporation tax, receives a dividend or other distribution from a company, it is taxed as income for corporation tax purposes unless the distribution qualifies for exemption.

Two distinct exemption regimes apply to corporate distributions:

one for small companies
for companies that are not small

For guidance on the reliefs available to small companies, see Practice Note: How are small companies taxed on distributions received? For an explanation of what counts as a small company for these exemption rules, refer to Practice Note: What is a small company for the purposes of the distribution exemption?...

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Web page updated on 21/05/2026

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