New legislation enacted increasing thresholds for Irish company size

On 19 June 2024, Minister for Enterprise, Trade and Employment, Peter Burke TD, signed into law the European Union (Adjustments of Size Criteria for Certain Companies and Groups) Regulations 2024 (the "Regulations"), which came into effect from 1 July 2024.

The Regulations will see the Companies Act 2014 amended to increase the company size threshold for micro, small and medium companies by 25 per cent. The purpose of the Regulations is to adjust company size thresholds in line with 25 per cent inflation, thereby reducing the regulatory and administrative burden on companies, which would otherwise become subject to audit and reporting requirements applicable to larger companies.

The main benefit will be seen in those companies which will now be classified as either small or micro, allowing those qualifying to claim both abridgement and audit exemption, significantly easing the burden associated with operating a small business.

The measures apply for financial years beginning on or after 1 January 2024, enabling companies to benefit from the increased thresholds immediately.  Companies may elect to apply the measures on or after 1 January 2023.

The below table outlines the relevant changes.