The definition of an SME – a small and medium sized enterprises – has officially changed.
As of today, 3rd October 2022, any company with fewer than 500 employees is classed as an SME and therefore exempt from certain bureaucracy.
The maximum size of a small business remains 49 employees but for a medium sized business it has been raised from 249 to 499 employees.
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The former definition was in line with EU definitions. The motive for changing the definition is to free up more companies from ‘the burden of regulation’.
Ministers do not yet know what the impact will be but hope to be able to go further. Once the impact on the current extension is known. “The government will also look at plans to consult in the future on potentially extending the threshold to businesses with 1000 employees, once the impact on the current extension is known,” it said.
Source: The Construction Index