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guide

Accounts and tax returns for private limited companies

Source:
GOV.UK
  • Part 1Overview

    At the end of its financial year, your limited company must prepare full (‘statutory’) annual accounts.

    You then use this information to:

    • send accounts to Companies House
    • send a Company Tax Return to HM Revenue & Customs (HMRC)
    • pay Corporation Tax - or tell HMRC that your limited company doesn’t owe any
    Action Deadline
    File annual accounts with Companies House 9 months after your company’s financial year ends
    File a Company Tax Return 12 months after your company’s financial year ends
    Pay Corporation Tax 9 months and 1 day after your company’s financial year ends

    These deadlines are for private limited companies.

    New and dormant companies

    You must take additional steps:

  • Part 2Prepare annual accounts

    After the end of your company’s financial year, you must prepare annual accounts - called ‘statutory accounts’ - from the company’s financial records.

    You must always send copies of the statutory accounts to:

    • all shareholders
    • people who can go to the company’s general meetings
    • HM Revenue & Customs (HMRC) as part of your Company Tax Return
    • Companies House (unless you send ‘abbreviated’ accounts - see below)

    How to put together your company’s statutory accounts

    Statutory accounts must include:

    • a ‘balance sheet’, which shows the value of everything the company owns and is owed on the last day of the financial year
    • a ‘profit and loss account’, which shows the company’s sales, running costs and the profit or loss it has made over the financial year
    • notes about the accounts
    • a director’s report
    • an auditor’s report

    A director must sign the balance sheet and their name must be printed on it.

    Accounting standards

    Your statutory accounts must meet either:

    • International Financial Reporting Standards
    • UK Generally Accepted Accounting Practice

    You can use accountants or tax advisers to make sure your accounts meet the standards.

    Small companies, audit exemption and abbreviated accounts

    Your company will be ‘small’ if it meets 2 of the conditions below:

    • its turnover is less than £6.5 million
    • it has less than £3.26 million on its balance sheet
    • it has fewer than 50 employees

    Your company will be a ‘micro-entity’ if it meets 2 of the conditions below:

    • its turnover is less than £632,000
    • it has less than £316,000 on its balance sheet
    • it has fewer than 10 employees

    If your company is small or a micro-entity, you can:

    • send shorter (‘abbreviated’) accounts to Companies House created from the statutory accounts - this means less information about your company will be publicly available
    • use the exemption so your company’s accounts don’t need to be audited
    • choose not to file a copy of the director’s report

    Find out what you need to include in your accounts depending on your company type, eg small, medium or dormant.

    Abbreviated accounts

    Abbreviated accounts are the balance sheet from the company’s statutory accounts.

    The balance sheet must be signed by a director and their name must be printed on it.

    You must still send full ‘statutory’ accounts to shareholders and to HMRC with your Company Tax Return.

  • Part 3Prepare a Company Tax Return

    You must send a Company Tax Return online to tell HM Revenue & Customs (HMRC) how much Corporation Tax your company needs to pay on its profits.

    The Company Tax Return includes:

    Information you’ll need

    You’ll need to give details including:

    HMRC has detailed guidance on everything you need to include on your Company Tax Return.

    If you made a loss

    A loss will reduce your Corporation Tax bill.

    But if you’ve made losses that you can’t claim back in one tax return because they’re too large, you can either:

    • claim the loss against your previous year’s profit - you may get a repayment of Corporation Tax if you do this
    • claim the loss in future financial years (if your company carries on the same type of trade)

    To claim the loss against your previous year’s profit either:

    • fill in the appropriate box on your Company Tax Return
    • write to your HMRC Corporation Tax office up to 2 years after the end of the financial year when you made the loss

    Repayments

    You tell HMRC how to make repayments when you complete your Company Tax Return.

    You might not get a repayment if your company owes HMRC for other taxes.

  • Part 4File your accounts and Company Tax Return

    If your accounts and Company Tax Return cover the same period, you can send them to both Companies House and HM Revenue & Customs (HMRC) at the same time.

    If you’re sending your company’s first accounts, you’ll usually need to send more than one Company Tax Return.

    You need your:

    • HMRC online Corporation Tax account details
    • company registration number
    • Companies House online account details
    • statutory accounts

    Sending your accounts and Company Tax Return together

    You can file your accounts with Companies House and tax return with HMRC jointly using accounting software or HMRC’s online service.

    HMRC’s online service

    1. Log in to your Corporation Tax Online account.

    2. Choose the link ‘File a return and accounts’.

    3. Download the CT600 form and the joint filing accounts template and follow the instructions.

    The service is free.

    Sending your Company Tax Return to HMRC separately

    You must do this online, using either:

    Sending accounts to Companies House separately

    You can send your company accounts online.

    Using accountants or tax advisers to send your returns and accounts

    To authorise them for HMRC, either:

    To deal with Companies House on your behalf, you must authorise your accountant or tax adviser to use your Companies House authentication code.

  • Part 5Corrections and amendments

    Your company accounts

    You must send amended accounts to Companies House on paper.

    You must follow specific rules for revised accounts.

    Your Company Tax Return

    You must usually do this within 12 months of the filing deadline.

    You can either:

    If you made an error, you should correct it as soon as possible. HMRC may charge you a penalty for errors.

  • Part 6Penalties

    Late accounts for Companies House

    If you file your annual accounts late with Companies House, your company will get a late filing penalty and the directors could be prosecuted or disqualified.

    Delay Penalty
    Up to 1 month £150
    1 to 3 months £375
    3 to 6 months £750
    More than 6 months £1,500

    The penalties double if your accounts are late 2 years in a row.

    You can appeal against a late filing penalty, but the appeal will only be successful if you can show that the circumstances are exceptional.

    Get an extension

    You can apply for an extension if both:

    • an unforeseen event outside of your control stops you from sending your accounts
    • you apply before the filing deadline

    Email or write to Companies House, explaining what’s happened and how long you’ll need to file your accounts.

    Companies House
    Crown Way
    Cardiff
    CF14 3UZ

    Late Company Tax Return

    Time after the deadline Penalty
    1 day late £100
    3 months late Another £100
    6 months late HMRC will estimate your company’s tax bill and add a penalty of 10% the unpaid tax
    12 months late Another 10% of any unpaid tax

    If your returns are late 3 times in a row, the £100 penalties are increased to £500 each.

    More than 6 months late

    If your Company Tax Return is 6 months late, HMRC will write telling you how much Corporation Tax they think you must pay. This is called a ‘tax determination’. You can’t appeal against it.

    You must pay the Corporation Tax due and send your Company Tax Return. HMRC will recalculate the interest and penalties you need to pay.

    Appeals

    You can appeal to HMRC against a late filing penalty if you have a ‘reasonable excuse’

    If you have a ‘reasonable excuse’, you can appeal against a penalty by writing to your company’s Corporation Tax office.

Part 1 Overview
Part 2 Prepare annual accounts
Part 3 Prepare a Company Tax Return
Part 4 File your accounts and Company Tax Return
Part 5 Corrections and amendments
Part 6 Penalties
govuk

Last updated: 05 August 2014