What are Current Liabilities?

Current Liabilities are debts on the balance which sheet that a business owes and needs to repay, usually within one year of the balance sheet date.

Current Liabilities Are Shown on the Balance Sheet

Current liabilities are included on the balance sheet, grouped together and called ‘Creditors: amounts falling due within one year‘. Here is an example:

Current liabilities
Current Liabilities of Example Accounts Ltd are £39,250 and are included in the line Creditors: amounts falling due within one year

The balance sheet doe not offer much information about who the business owes money to so a note is added to give some further detail:

current liabilities noteExamples of Current Liabilities

Current liabilities are debts that need to be repaid within one year of the balance sheet date, here are some examples:

  • Trade creditors;
  • Bank loans (the portion repayable within one year);
  • Bank overdrafts;
  • VAT;
  • PAYE.