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Definition of SMEs

As from today any company with fewer than 500 employees is classed as SMEs – small and medium sized enterprises – and consequently will be exempt from certain bureacracy.

The maximum size of a small business is still 49 employees, a medium sized business has been raised from 249 to 499 employees.

The previous definition was in line with EU definitions and the reason for changing this is to free up more companies from ‘the burden of regulation’.

The impact of the decision is not yet known but ministers hope to be able to advance the situation when the impact of the current extension is recognised.

The government is to also look at plans to consult in the future on possibly extending the threshold to businesses with 1000 employees.