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.