You can change your company year end by filing form AA01 with Companies House. You can shorten it as often as you need to, but you can only lengthen it once every five years, and never beyond 18 months. Doing it to buy time before a filing deadline works, but it brings extra tax paperwork and the rules tighten from April 2028.
There are two very different reasons business owners look up how to change their company year end. Some want their accounts to line up better with the way their business actually runs. Others have a filing deadline looming and have heard about a well known workaround: shortening the year end by a single day.
Both are legal, and both use the same simple form. But the second is a sticking plaster rather than a solution. It has knock-on effects that are easy to miss, and new rules will soon limit how often it can be used.
Here is how to change your company year end, how the one day trick works, and what to weigh up before you file the form.
How to change your company year end
Your company’s accounting reference date, or year end, is not fixed forever. To change your company year end, you file form AA01 with Companies House, online or by post. It is free, and the change can apply to your current financial year or the previous one, as long as those accounts are not already overdue.
That is the mechanics. Now for the quirk that gives this form its reputation. Under the Companies Act, when you shorten your accounting period, your filing deadline becomes the later of nine months from your new year end, or three months from the date you gave notice. So if you shorten your year end by just one day, say from 31 March to 30 March, you are granted three months from the date of the form to file. Filed the day before your deadline, that is three extra months.
On paper, you have avoided a late filing penalty and your company record never shows as overdue. So far, so clever.
Why it is legal but rarely free
The problem is not that the trick breaks any rules. It is that it treats the symptom rather than the cause, and it leaves footprints.
• The change sits on your public record. The AA01 is a public filing. Anyone who looks at your Companies House record, including lenders, suppliers and potential customers, can see that your year end moved by one day just before your accounts were due. Do it more than once and the pattern is obvious.
• Credit checks can pick it up. Credit reference agencies monitor Companies House data, and a last minute shortening of an accounting period is a recognised sign of a company buying time. Some scoring models treat it as a risk signal, which can affect your score or credit limit even though you have technically done nothing wrong.
• Your corporation tax period moves too. Your accounts and your corporation tax return are built on the same period. Shorten the year and the tax period ends earlier as well, which pulls your payment date forward. And if year end changes are made repeatedly, your accounting and tax periods can drift out of step, which means extra work for your accountant, and usually extra fees for you.
• The accounts still have to be prepared. The trick buys time. It does not make the work go away, and accounts pulled together in a rush months later often cost more to produce than accounts prepared from tidy, current records.
The rules are tightening from April 2028
Companies House is well aware of how this workaround is used. As part of the Economic Crime and Corporate Transparency Act reforms, from 1 April 2028 companies will only be able to shorten their accounting period once every five years, unless they can give a genuine business reason. That mirrors the rule that already applies to lengthening a period.
| The rules now | From 1 April 2028 | |
| Shortening your year end | As often as you like | Once every five years, unless you give a business reason |
| Lengthening your year end | Once every five years, up to 18 months | Unchanged |
In other words, the escape hatch is closing. A business that relies on this trick to manage its deadlines will soon find it can only do so once, and then not again for five years.
When changing your company year end makes sense
None of this means a change of company year end is always a bad idea. Done deliberately, and planned in advance, it can be a sensible commercial decision. Common good reasons include:
• Joining a group. Aligning your year end with a parent or subsidiary company makes consolidated accounts far simpler.
• Seasonal trade. Moving your year end to a quieter time of year, after your busy season, gives you cleaner stock figures and a less stressful year end.
• Tax planning. In some situations, the timing of your year end can affect when tax falls due and how reliefs apply. That is a conversation to have with your accountant well before the deadline, not the day before it.
The difference is intent. A planned change made for commercial reasons is normal business practice. A panicked change made the day before a deadline is a warning sign, and it reads as one.
A better way to handle a looming deadline
1. Talk to your accountant straight away. The earlier they know there is a problem, the more options they have. A rushed conversation in the final week helps nobody.
2. Consider a formal extension instead. If something genuinely outside your control has held things up, such as serious illness or an unexpected event, you can apply to Companies House for more time to file. The application must be made before your deadline passes.
3. Fix the cause, not the deadline. If your records are the reason you are always up against it, that is the thing to change. Simple digital bookkeeping tools, kept up to date monthly, turn year end from a crisis into a formality, and give you useful information about your business all year round.
Plan ahead, and the trick becomes irrelevant
The one day trick exists because deadlines catch businesses out. With tidy records, a clear timetable and an accountant who plans ahead with you, it is a trick you should never need.
At Wessex Commercial Solutions, we help business owners across the South West stay ahead of their filing dates and understand what their numbers are really telling them. If your year end always seems to turn into a scramble, or you are weighing up whether a change of company year end makes commercial sense for you, get in touch for a friendly, no pressure chat.