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Size criteria for enterprises: the impact on tax rates and filing annual accounts

Size criteria for enterprises: the impact on tax rates and filing annual accounts

April 2023 – In our country, a company's size criteria are used to determine tax rates and filing of financial statements, among other things.

The size of your enterprise is determined on the basis of three criteria: annual turnover, balance sheet total and number of employees. Depending on these criteria, an enterprise is classified into one of the following categories: micro, small, medium or large enterprise.

Do you have a micro or small enterprise? Then, as a manager, you enjoy lower tax rates and have to deal with less stringent rules for filing annual accounts.

In mid-March 2022, the Accounting Standards Commission (CBN) published a new version of its advice on the criteria that a small company should meet.

A company that does not exceed more than one of the following criteria on the balance sheet date of the last completed financial year qualifies as a small company:

  • Annual average number of employees: 50

  • Annual turnover (excluding VAT): 9,000,000 euro

  • Balance sheet total: 4,500,000 euro

The micro company is a subcategory of the small company. This is a small company that is not a subsidiary or parent company on the balance sheet date and does not exceed more than one of the following criteria:

  • Annual average number of employees: 10

  • Annual turnover (excluding VAT): 700,000 euro

  • Balance sheet total: 350,000 euro

Medium-sized and large companies 

generally have higher tax rates and must comply with stricter rules for filing annual accounts.

As regards the filing of annual accounts, as a micro or small enterprise you may file simplified annual accounts, while medium-sized and large enterprises must file full annual accounts.


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