As with small and medium-sized businesses (SMEs), there is no single definition of what a micro-business is, and different parts of the government use different definitions and terminologies.
While the Office for National Statistics (ONS), which publishes yearly figures on the number and size of businesses in the UK, does not expressly refer to micro-businesses, its figures have been used in governmental reports about micro-businesses. In these reports, micro-businesses are referred to as businesses with between 0 and 9 employees.
Companies House has simplified account filing requirements for micro-businesses, which are referred to as ‘micro entities’. Under this definition, a micro entity is any business that meets two of the following criteria:
- a turnover of £632,000 or less
- £316,000 or less on its balance sheet
- 10 employees or less
It is therefore likely that any small business employing less than 10 employees may be classified as a micro-business.