Research and reports
Before you can pay corporation tax, you usually need to work on your company tax return – here’s what small businesses should know.
While the deadlines for paying your corporation tax and filing a company tax return are different, in practice they’re often done at the same time.
This is because you usually need to complete a company tax return (also known as form CT600) to know whether there’s a corporation tax bill to pay.
While it’s possible to complete the return yourself, lots of companies choose to enlist the services of an accountant to help them out.
Here’s what small business owners should know about filing a company tax return and paying corporation tax – but use this as a guide only, and make sure you seek professional advice if you’re unsure of anything.
A company tax return is used to report your spending, profits, and corporation tax due to HMRC. It involves completing a CT600 form and submitting a financial report with calculations that show how much you owe in tax.
Our guide to corporation tax has more on when to pay and how to register.
You need to file one of these if your company gets a ‘notice to deliver a company tax return’ from HMRC.
Keep in mind that even if your company has made a loss, or if you have no corporation tax to pay, you still need to file.
The deadline for filing is 12 months after the end of the accounting period the return covers. Your accounting period is normally the same as the financial year covered by your company’s annual accounts – but it might be different in some circumstances, for example your first year of trading. In that situation, you'd need to send two corporate tax returns to cover your first year.
If you’re not sure when the end of your accounting period was, you can sign in to your HMRC business tax account to check.
For example, if you start your business on 15 January 2023, Companies House will set your financial year to end on 31 January 2024.
This means you’ll need to file two tax returns in your first year. One to cover the first 17 days and one to cover the following 12 months.
After your first year of trading, your accounting period will run from 1 February to 31 January.
A company tax return should show:
You can file your accounts with Companies House and your corporate tax return with HMRC at the same time if your limited company doesn’t need an auditor. You can file these online (you can’t use the paper CT600 form unless you have a reasonable excuse or you want to file in Welsh).
Most small companies won’t need an audit – HMRC say they generally only need one if it says they do in their articles of association, or their shareholders ask for one.
The company tax return is also called form CT600. It'll include standard company information, but you also need to do some complex calculations. Depending on your company these include calculations like:
The accounts and computations part of the limited company tax return must be in the Inline eXtensible Business Reporting Language (iXBRL) format.
Because filing the return is complex, HMRC publish this CT600 Guide to help small business owners.
You should check that out for more information, and again, keep in mind that many limited companies get professional help from tax advisers and accountants when preparing their return.
As you might expect, there are fines for filing late.
How late is your return?
One day late
Three months late
A further £100
Six months late
HMRC will estimate your corporation tax bill and add 10 per cent of the bill as a penalty
12 months late
Another 10 per cent of the tax liability
The deadline for paying your corporation tax bill (for companies with taxable profits of up to £1.5 million) is nine months and one day after the end of your accounting period.
You can pay by:
You can pay corporation tax at gov.uk.
If you don’t pay on time, HMRC say that they'll charge you interest on a daily basis. This starts from the day after you should’ve paid and continues until you eventually pay it.
HMRC say that late payment interest is actually tax deductible for corporation tax purposes, which “means you can include this expense in your company accounts for the accounting period (or periods) when the interest was incurred.”
Is there anything else you’d like to know about filing your limited company tax return? Let us know in the comments below.
Sam has more than 10 years of experience in writing for financial services. He specialises in illuminating complicated topics, from IR35 to ISAs, and identifying emerging trends that audiences want to know about. Sam spent five years at Simply Business, where he was Senior Copywriter.
We create this content for general information purposes and it should not be taken as advice. Always take professional advice. Read our full disclaimer
6th Floor99 Gresham StreetLondonEC2V 7NG
Sol House29 St Katherine's StreetNorthamptonNN1 2QZ
© Copyright 2023 Simply Business. All Rights Reserved. Simply Business is a trading name of Xbridge Limited which is authorised and regulated by the Financial Conduct Authority (Financial Services Registration No: 313348). Xbridge Limited (No: 3967717) has its registered office at 6th Floor, 99 Gresham Street, London, EC2V 7NG.