Basis period question

Basis period question

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Apologies if this sounds too simple a question....

A new client told me that she started a company on 25 March 2012 and her year end is 31 March. She prepared a return for companies’ hse and HMRC  for period 12 months 1st April 2012 ending 31 March 2013.  She claimed the company only started trading in April 2014 and so she didn’t see the need to prepare accounts from incorporation 25 March as the CT600 required her to file two sets of accounts instead –so she filed accounts for period 1 April 2012 to 31 March 2013. Should I be worried as my understanding is that she should have filed accounts from incorporation for 12 months ie  22 March 2012 to 31 March 2013 in two separate returns?? Does HMRC get back to a client is she has already filed the accounts in this format?

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By videfa
27th May 2014 20:35

any takers. thank you in advance

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By bigmuggsy
28th May 2014 21:43

You need to file two sets of accounts/Ct600 if the first period of trading is long. (I.e over 12 months). If the company didn't trade till after 1 April (so thus the accounting period is less than 12 months) then only one set of accounts is correct.

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By johngroganjga
28th May 2014 23:18

The periods for which companies prepare accounts are nothing to do with HMRC. They are a matter of Company Law, and are managed by Companies House not HMRC. So a company incorporated on 25 March 2012 which accepted the default accounting reference date of 31 March should have prepared its first accounts for the period from incorporation to 31 March 2013, and will now be in the process of preparing its accounts for the year ended 31 March 2014.

What is irregular in what you describe is that the first accounts did not start from the date of incorporation, so there is a gap in the company's reporting record. I would have expected Companies House to have rejected those accounts on the basis that they covered the wrong period, but I am not surprised that they didn't. So your client seems to have got away with that slight irregularity. If there were no trading transactions in the missing period it hardly matters.

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