The government has opened a consultation on reducing paperwork for SMEs, with plans to simplify reporting requirements and cut costs. The proposals aim to reduce the regulatory burden on smaller and family businesses by doing away with “outdated rules.”
Key proposals include simplifying which businesses need to adhere to which reporting rules and testing the merits of non-financial reporting requirements for private companies. The government also plans to make it clearer who financial reports and accounts are for, with a lighter regulatory load for SMEs.
Other proposals include exempting more businesses from audits, including medium-sized businesses, and making the UK’s reporting rules clearer and more coherent. The government also plans to replace the complex rules on distributable profits and capital maintenance with a solvency-based regime.
According to estimates, these changes will save more than £450 million per year. Business secretary Jonathan Reynolds said: “No-one goes into business to fill out forms. For years, hardworking firms in this country have been weighed down by pen-pushing paperwork and frustrating costs, ticking boxes that do nothing to help them grow their business.”
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Reynolds added that the government is “stripping back outdated bureaucracy and building a common-sense system fit for a 21st-century economy.” This will cut the cost of doing business, giving breathing room to bosses across the country, and free them up to focus on what they do best, creating jobs and growth.
The process for scrapping director’s reports is already underway, as are plans to make more businesses exempt from providing strategic reports. Small businesses currently have cumbersome reporting rules and paperwork, which add weight to their many day-to-day tasks and drain them of thousands of pounds – and countless hours.
For those interested in providing feedback, the consultation opened on September 7, 2026, and will close at 23:59 on November 30, 2026. The government’s plans could have a significant impact on small businesses, particularly in light of recent reporting changes, such as the requirement for small firms to report profit and loss from 2028.
By streamlining reporting requirements and reducing paperwork, the government hopes to create a more favorable business environment, allowing SMEs to focus on growth and job creation. The consultation provides an opportunity for businesses to share their thoughts on the proposed changes and shape the future of reporting requirements in the UK.