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Can I prepare one set of company accounts for HMRC

Any problem filing Accounts for 18 months with HMRC and two sets for same period at Companies House?

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We have a limited company client where previous Financial Statements were prepared to 30 September 2019.

The client wants to prepare their next Financial Statements for an 18 month period to 31 March 2021.  An 18 month period is the maximum length an accounting period can be under company law.

We are now at an advanced stage in the preparation of the Financial Statements for the 18 months to 31 March 2021.

Normally, I would file two Corporation Tax Returns; one for the 12 months to 30 September 2020 one for the 6 months to 31 March 2021.  We would include the 18 months iXBRL tagged Financial Statements with the first Corporation Tax Returns, tick the appropriate boxes on the second Corporation Tax Return, to say that 18 months iXBRL tagged Financial Statements and Corporation Tax computation are attached to the first Corporation Tax Return.  I have done that many times with no problems and that is the proper way to do it.

I am sure that everyone is with me at this point and would fully agree with what I have said.  This is the usual position when dealing with a longer accounting period.

However, when I tried to change the accounting reference date at Companies House it was rejected.  The reason given was that somebody had extended the accounting reference date another time within the last five years.  On checking at Companies House, I can see that the first set of Financial Statements prepared were for a 13-month period.

Practically, I don’t want to prepare two sets of accounts at this late stage.

I think therefore we would have to shorten the current accounting reference date, from 30 September 2021 to 31 March 2021.  This would necessitate filing accounts at Companies House for the year ended 30 September 2020 and the six months ended 31 March 2021.

The company is a micro entity, FRS05 with one director-shareholder.  We would therefore have to file just a Balance Sheet at Companies House.  I appreciate that this should be a Balance Sheet from the full filleted set of Financial Statement (which I do not want to prepare to 30 September 2020).

It is going to take quite a lot of work to prepare two sets from the one set. The Corporation Tax should be identical.

I wonder if there would be any problem submitting the two Corporation Tax Returns to H M Revenue & Customs as noted above, just as if the accounting reference date had validly been extended to 18 months to 31 March 2021.  Practically, I cannot see H M Revenue & Customs checking exactly what has been filed at Companies House, and therefore reject my submission to them.

I would have to try to prepare a Balance Sheet at 30 September 2020, to file at Companies House, but that should be a relatively easy task…..  And a lot simpler than preparing two sets of accounts. just to file the same (or very similar calculated) Balance Sheet at Companies House.

As the client does not have accounting software, and works on Excel, preparing an annual cash book, then they have to prepare a list of debtors, creditors and stock at the accounting reference date to ‘bolt-on’ to the cash book transactions for the period.

Would anyone see a practical problem filing one set of tagged Financial Statements for 18 months with H M Revenue & Customs, via two Corporation Tax Returns, for Corporation Tax purposes, and two sets of accounts (well just two Balance Sheets) for Companies House at 30 September 2020 and 31 March 2021?

Your comments will be gratefully appreciated.

Replies (11)

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RLI
By lionofludesch
30th Apr 2021 18:40

The problem is that everyone should be getting the same set of accounts, so, technically, no, you can't do this.

Whether anyone would pick up on it is a different matter.

Personally, I'd be happier just contacting Companies House and asking for a code to change the year again. Something I've never done, so can't help you with the actual process.

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Replying to lionofludesch:
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By thevaliant
30th Apr 2021 20:51

I'd agree with Lion. Simply ask Companies House permission to extend twice in more than five years, and explain the circumstances. Client forget etc etc. I suspect they'd grant it.

If you're going down the route of potentially doing something you shouldn't (as Lion has also alluded to) I'll just point out that a former accountant of a current client extended twice in two years (well, three!) by simply ticking the box that they were extending to align with a group company. The client company has only one (person) shareholder, the same person for the last twenty years. Companies House perform no checks on this sort of extension at all.

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By Paul Crowley
01st May 2021 00:21

This is just an admin issue, not a deliberate mislead.
We did it once many moons ago
Tried to move a month, too late on a a first period.
Just made it fit by using the Feb date but March figures.
No body will be interested so just pick one of the above that works.

These are custodianship accounts not valuation accounts, no tax being deliberately manipulated, or mislead to interested parties or lenders.

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ALISK
By atleastisoundknowledgable...
01st May 2021 07:09

Should you - probably not.
Can you - probably yes.
Will anyone notice - probably not.

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RLI
By lionofludesch
01st May 2021 07:31

I have to say that I once split up a two year set of partnership accounts into two separate years and it didn't take as much time as you might imagine.

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By armstrongbell
03rd May 2021 22:39

I know this horse has bolted but the first thing to check before spending time preparing accounts for a longer accounting period is whether the year end has already been extended within the last 5 years. The client is at least still in time for the original filing deadline so, as others have said, you may be granted the extension by Companies House.

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By Duggimon
04th May 2021 09:14

If you were filing 18 month accounts, the tax returns would pro rata the profit between the two periods. If you do the same with the P&L for the two sets of accounts, all you need are balances as at September 2020, which you need anyway, so why not just do two sets of accounts.

Really though, with a decent set of working papers, splitting the P&L figures between the two periods properly is maybe an hour's work at most, I'd probably just do it.

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Replying to Duggimon:
RLI
By lionofludesch
04th May 2021 09:34

I agree Duggi. The fella's talking about preparing a 12 month balance sheet for Companies House. That's the hard bit.

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By armstrongbell
04th May 2021 12:38

As someone has said, if you prepare an 18 month set of accounts, the profits/losses will be pro rated into 12 months and 6 months for CT. If you're not entitled to prepare an 18 month set, the profits and losses for CT purposes will be those that actually occurred in the actual accounting periods. This could mean that CT due is different if there are any losses incurred in these periods or any losses carried back against these periods in future.

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All Paul Accountants in Leeds
By paulinleeds
07th May 2021 12:28

Thank you everyone for your comments last week. Most helpful.

I found out from research and speaking to Companies House that you can extend the Accounting Reference Date, using the normal Web Filing facility, by clicking the dropdown, on the right hand side, to select 1 of 3 reasons why you are permitted to extend more than one in 5 years. One of the reasons, as others have mentioned, is to have coterminous year ends with other group companies (parent or subsidiary).

Quite surprisingly, when I asked Companies House, where I enter the parent's or subsidiary's details as proof, they replied "we take it on trust"!

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Replying to paulinleeds:
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By thevaliant
07th May 2021 12:43

Which is, of course, why I've seen an FCA simply tick that box.

An FCA! Simply logged on, ticked that box, and extended again having done it the year before. Just goes to show that those with professional qualifications does not make one ethical (I'm an FCA too).

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