Hi There,
An entity has employees of more than 250 but turnover is below 50m Euros and balance sheet figure is below 43m euros. Will that still be qualifying for an SME defintion.
As per legislation its AND between employee and turnover threshold. Apparently to be and SME both condition (or balance sheet figure) MUST need to be satisfied to be an SME.
Please give your thoughts.
Kind Regards
Replies (2)
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By SME do you mean Medium?
The Companies Act gives the limits in Sterling not Euros.
To qualify as small or medium it is any two out of three - turnover, balance sheet total and Employees less than the limit
Whereas for the EU definition, which is used in things such as transfer pricing and R&D tax credits (where it is EU x 2) to name but two, it is fewer than 250 employees and either turnover less than 50m Euros or balance sheet total below 43m euros. So, if you have more than 250 employees then you are not an SME.
As the helpful guide puts it "Meeting the staff headcount criterion is mandatory in order to be considered an SME. However, an enterprise may choose to meet either the turnover or the balance sheet total ceiling. It does not need to satisfy both requirements and may exceed one of them without impact on its SME status"
Helpful guide => http://ec.europa.eu/DocsRoom/documents/15582/attachments/1/translations (hopefully)...