PET GAZETTE |
17
RESPONSIBILITIES
UNDER CORPORATION
TAX SELF-ASSESSMENT
Corporation Tax is collected under a self-
assessment approach known as Corporation
Tax Self-Assessment (CTSA). Under CTSA
companies do not receive a bill for Corporation
Tax but there are specific things you must do
to work out, pay and report your tax.
n Register for Corporation Tax when you
start doing business or re-start a dormant
business. Unincorporated associations
must write to HMRC.
n Keep accounting records and prepare
a Company Tax Return to work out how
much Corporation Tax to pay.
n Pay Corporation Tax or report if you have
nothing to pay by your deadline - this is
usually nine months and one day after the
end of your accounting period.
YOUR CORPORATION TAX
‘SET UP’ PROCESS
When starting a limited company you must
first register (incorporate) it with Companies
House. Following incorporation, Companies
House will contact HMRC to inform them that
the company has been set up.
You will then be sent a Unique Taxpayer
Reference (UTR) from HMRC within a few
days. You wil l need to provide this every
time you contact HMRC. You will also
receive a letter explaining how to set up an
online account for company tax returns and
corporation tax purposes, and giving the
dates for the accounting period.
If you do not plan to start trading
immediately you should contact your local
corporation tax office to inform HMRC that
your company is dormant. However, HMRC
must be informed once the company becomes
active and it must be ‘set up’ for corporation
tax within three months of the start of the
accounting period to avoid penalties.
Within three months of the company
becoming active or starting to trade HMRC
must be informed of:
n The company’s name and
registered number
www.petgazette.biz
n The main trading address
n The date the company started to trade
n The main trading activities
n The date up to which the main accounts
will be calculated
Information can be provided online using
the company’s UTR and the details provided
will be used by HMRC to work out when
the company must pay corporation tax.
The initial registration process for an online
account takes at least ten working days to
complete as it involves HMRC posting out a
12 digit activation code, which is required
when logging into the online account. A ‘User
ID’ (also known as a Government Gateway
Account), will also be issued to enable the
creation of a password so that information
can be reported online to HMRC.
You can authorise someone else (agent) to
deal with HMRC on your behalf, such as your
accountant. To do this they must use HMRC’s
online authorisation service www.gov.uk/
guidance/applying-for-client-authorisation-
using-hmrc-online-services or complete form
64-8 www.gov.uk/government/publications/
tax-agents-and-advisers-authorising-your-
agent-64-8 and send it to HMRC.
If no tax is due, HMRC must be informed
by the deadline for payment and a company
tax return must still be completed. Dormant
companies may not have to pay Corporation
Tax or complete company tax returns and
HMRC will inform them if this is the case.
The tax is payable nine months and one
day after your company’s accounting year
ends, if your profits are £1.5 million or less.
Profits above £1.5 million must be paid in
installments.
For more information about the
Corporation Tax process go to
www.gov.uk/corporation-tax.
The rules surrounding Corporation Tax are
complex and this information is intended only
as a starting point to understanding the issues
involved. It is essential to seek professional
advice to ensure that obligations are met and
the right amount of tax is paid.
THE FORUM OF
PRIVATE BUSINESS
The Forum of Private Business
specialises in providing affordable help
and advice.
The Forum has been working with
small businesses for nearly 40 years -
through good times and bad - helping
them get the best out of employees,
save money and get their voices heard.
If you’d like to know how they can help
you, call the Forum’s member helpline
on 01565 626 001 or for instant access
apply online at www.fpb.org.
July 2017