Audit exemption and late filing: the rule since July 2025
Since 16 July 2025, a small or micro company only loses its audit exemption if it files its annual return late more than once in a five-year period. If it does, it can't claim the exemption for the following two years. A first late return in that period still costs the late filing fee.
What changed
Before 16 July 2025, a single late annual return automatically cost a small company its audit exemption for two years. Section 22 of the Companies (Corporate Governance, Enforcement and Regulatory Provisions) Act 2024 replaced that rule with a graduated one.
The rule now
- A first late return in a five-year period: the late filing fee applies, but the audit exemption isn't lost because of it.
- A second late return within five years: the company loses its audit exemption for the following two years.
- The company's first annual return, and late returns filed before 16 July 2025, don't count as a previous late filing.
Watch out
- Companies that filed late before 16 July 2025 still need audits for the two years that followed, under the old rule.
- The change doesn't extend to companies in a group. One late return can still cost every company in a small group its audit exemption.
Why it matters
An audit typically costs far more than the €1,200 maximum penalty. Having had one late return, a company has no margin left for five years, which is exactly when a deadline watch earns its keep. See our plans.
Last checked 13 November 2026 against CRO and Revenue guidance. This is general information, not legal advice for your company.