What Does Debtors Mean on Companies House?

When you look up a company’s financial records on Companies House, you might come across a line in the balance sheet labelled "Debtors". For those unfamiliar with accounting terminology, this can be confusing. Does it mean the company is in debt? Does it reflect unpaid bills? Or is it something else entirely?

Understanding what debtors represent on a balance sheet is vital for assessing your company’s cash flow and financial health. If your debtor figures are consistently high, it could point to delayed customer payments or a lack of credit control, both of which can impact day-to-day operations. Our limited company accountants provide hands-on support to businesses looking to better manage their financial reporting. From analysing debtors in the context of your wider accounts to improving your invoicing and credit policies, we help directors make sense of their numbers and strengthen their cash position over time.

In this article, we explain exactly what "debtors" means on Companies House records, how it affects a company’s financial position, and what it tells you about the business.

What Are Debtors?

In accounting, debtors refers to money that is owed to the company. It represents amounts the business expects to receive in the future, typically from customers or clients who have been invoiced but have not yet paid.

Debtors are classed as assets, not liabilities. They appear on the company’s balance sheet under current assets because they are expected to be converted into cash within the next 12 months.

Where Will You See Debtors on Companies House?

When a company files its annual accounts, Companies House publishes a version of the financial statements for the public to view. These typically include a balance sheet, which shows the company’s assets, liabilities, and equity.

"Debtors" will appear under Current Assets and is often broken down into:

• Trade debtors (unpaid customer invoices)

• Other debtors (loans made by the company or amounts due from HMRC)

• Prepayments and accrued income (payments made in advance or revenue earned but not yet received)

The total figure gives an indication of how much money the company is waiting to collect.

Does It Mean the Company Owes Money?

No. Despite the word “debtors,” this figure does not refer to money the company owes. Instead, it refers to money that others owe to the company.

Money that the company owes is listed under creditors, not debtors. These are shown in a separate section of the balance sheet, usually under “Creditors: amounts falling due within one year” or similar.

Find out more about how to read accounts on Companies House.

Why Are Debtors Important?

Debtors give an insight into the working capital of a company. A high level of debtors might indicate:

• The business is selling on credit terms (common in B2B industries)

• It has outstanding invoices waiting to be paid

• It may be slow to collect payment, which could lead to cash flow issues

On the other hand, a very low debtor figure could suggest the business operates mostly on cash sales or collects payment immediately.

When reviewing a company’s financial health, especially for due diligence or credit risk checks, looking at debtor levels alongside turnover, cash at bank, and creditor figures can provide a more complete picture.

Real-World Example

Let’s say a company’s balance sheet shows £80,000 in debtors. This could mean:

• £60,000 is owed by customers for sales made on invoice

• £10,000 is due from HMRC as a tax refund

• £10,000 is in prepayments for services or software the company has paid for in advance

All of this is money the company expects to recover or benefit from in the short term.

Final Thoughts

On Companies House, “debtors” means the value of money that others owe to the company—not the other way around. It is recorded as a current asset and plays a key role in showing the business’s expected incoming cash. While it is not a red flag by itself, high or rising debtor balances should be looked at in context with the company’s cash position, collection practices, and overall liquidity.

Understanding how to read these figures can help investors, suppliers, lenders, and business owners make better decisions based on real financial insight. For smaller companies and sole directors, the figures on Companies House can often feel disconnected from the reality of running a business. That is where our small company accountant service makes a real difference. We explain what each line in your accounts actually means, ensure your debtors are reported correctly, and help you put simple systems in place to avoid cash flow issues. Whether you need help understanding overdue invoices, planning for Corporation Tax, or filing your annual accounts, we make the entire process easier to manage and fully compliant.

Unsure what to file, when to file it or how to stay compliant? Our Companies House Help hub walks you through it all.

You might also be interested in what does creditors mean on companies house.