Companies Act 2014 section 280I

Treatment of qualifying conditions in respect of certain financial years

Section 280I provides companies and groups with a choice of when to apply updated monetary thresholds for size classification purposes, following changes introduced by the European Union (Adjustments of Size Criteria for Certain Companies and Groups) Regulations 2024.

• When EU-driven regulations adjust the turnover or balance sheet total thresholds used to classify companies and groups by size, companies have a choice about when to start applying the new figures.
• A company or group may elect to apply the revised thresholds to financial years beginning on or after 1 January 2024, or alternatively to financial years beginning on or after 1 January 2023 (as permitted by the EU Commission Delegated Directive 2023/2775).
• The election applies across all the relevant size-classification provisions, namely sections 280A(3), 280B(4), 280D(3)(b), 280F(3) and 280G(4), covering small companies, small company holding companies, micro companies, medium companies and medium company holding companies.
• Once the company or group makes its election, the chosen effective date governs how the qualifying conditions under all those provisions are assessed for the relevant financial years.