Just had a new small company client come to me whose first accounts are due to be filed by 3rd May. He has been using a bookkeeper to maintain his records but it is not yet clear in what format and he was not aware that bookkeeper would not be able to finalise and file accounts. At this late stage it may well be difficult to get accounts filed in time and whilst I am aware that shortening the accounting date generally gets an extra 3 months to file, does this work on the first accounts. I don't want to shorten and then find I just have even less time to complete and file. Can someone put my mind at rest?
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Good question - I don't know, though I would sway in favour of yes.
File the application to shorten on the last available day. What do you have to lose ? End of the day, it's the directors' fault that you're pushed into this position. If they get a £150 penalty, tough. I wouldn't lose sleep over it, personally.
As per Companies House, the first accounts should be filed within 21 months of incorporation, therefore shortening the accounting period shouldn't make any difference to the filing date.
Except the law says different:-
https://www.legislation.gov.uk/ukpga/2006/46/section/442
442 Period allowed for filing accounts
(4)If the relevant accounting reference period is treated as shortened by virtue of a notice given by the company under section 392 (alteration of accounting reference date), the period is—
(a)that applicable in accordance with the above provisions, or
(b)three months from the date of the notice under that section,whichever last expires.
As per Companies House, the first accounts should be filed within 21 months of incorporation, therefore shortening the accounting period shouldn't make any difference to the filing date.
It also says that accounts need to be filed within nine months of the year end. But we know that shortening does affect that.
EDIT
Damn your nimble fingers, Wanderer.
Doesnt make any difference that it is the first accounting period.
Shortening by a day will get you 3 months extra to file from the day you shorten. You can then do it again 3 months later and get another 3 months (as you will still be in the 2nd accounting period and you can shorten either the current or previous period).
Only thing to be aware of if you do it twice is that the corporation tax return will be late if you file more than 12 months after the first period end and as you are likely to have 2 CT returns to do (given the accounts will be more than 12 months) you will get £100 penalty for each of the CT returns.
Only thing to be aware of ...
And in fact potentially the CT payment will be due before you’ve prepared the accounts.
marks wrote:
Only thing to be aware of ...
And in fact potentially the CT payment will be due before you’ve prepared the accounts.
Likely to be the case already so I wouldn't worry about it too much.
Doesnt make any difference that it is the first accounting period.
Shortening by a day will get you 3 months extra to file from the day you shorten. You can then do it again 3 months later and get another 3 months (as you will still be in the 2nd accounting period and you can shorten either the current or previous period).
Only thing to be aware of if you do it twice is that the corporation tax return will be late if you file more than 12 months after the first period end and as you are likely to have 2 CT returns to do (given the accounts will be more than 12 months) you will get £100 penalty for each of the CT returns.
The twelve months runs from the end of the period of account, not the CT accounting period, so not necessarily.
HMRC will raise the penalties. However, they can be succesfuly appealed because the ct600 filing date is extended to the date the accounts are due at companie house!
HMRC will raise the penalties. However, they can be succesfuly appealed because the ct600 filing date is extended to the date the accounts are due at companies house!
How does that work, then ?
In normal circumstances, the CT600 is due three months after the accounts.
Can you point to the legislation ?
The CT600 is due 12 months after the end of the period of account regardless of when the accounts are filed. The relieving provision is
Paragraph 19 of Schedule 18 to Finance Act 1998
I read that paragraph as potentially extending the CT600 filing date to the (new) filing date of the accounts with the Registrar.The CT600 is due 12 months after the end of the period of account regardless of when the accounts are filed. The relieving provision is
Paragraph 19 of Schedule 18 to Finance Act 1998
I read that paragraph as potentially extending the CT600 filing date to the (new) filing date of the accounts with the Registrar.
No. For a start, the new filing date might not be three months later. Could be one and a bit months. Could be a couple of days.
Moreover, the CT600 filing date is more than nine months after the year end so you can see what you need to put on form CT600A. You might not know whether a loan to a participator is repaid.
Yes but what about a bit of double shortening?
Surely you could then get into a situation when the Companies House filing date & therefore the CT600 filing date is more than 12 months after the year end?
Yes but what about a bit of double shortening?
Surely you could then get into a situation when the Companies House filing date & therefore the CT600 filing date is more than 12 months after the year end?
No - it's still twelve months after the year end.
"Double shortening" will, almost inevitably, get you a penalty.
Okay, maybe I'm misreading, certainly been guilty of that before, but how does that fit in with:-No - it's still twelve months after the year end.
"Double shortening" will, almost inevitably, get you a penalty.
19 A company is not liable to a penalty under paragraph 17 (flat rate penalty) if—(a)the period for which the return is required is one for which the company is required to deliver accounts under the Companies Act 2006, and
(b)the return is delivered no later than the last day for the delivery of those accounts to the registrar of companies.
No that’s wrong. The legislation cited provides that there is no penalty if the return is lodged by the accounts filing data, whatever that may be.
I acknowledge that my previous comment is a little misleading- what I should have said is that the CT600 filing date is ‘usually’ 12 months after the period end. Strictly, it always is but the legislation provides an acceptable excuse for late filing in the particular circumstances being discussed here.
The CT600 is due 12 months after the end of the period of account regardless of when the accounts are filed. The relieving provision is
Paragraph 19 of Schedule 18 to Finance Act 1998
Which is what I said a week ago.
Thank you.
You do have the option of writing to C. House, requesting an extension to the filing deadline due to the circumstances you find yourself.
You do have the option of writing to C. House, requesting an extension to the filing deadline due to the circumstances you find yourself.
Doesn't have the same certainty as shortening the AP, though, does it ?
They could say no.
That reminds me of applying for extensions on SAR audits reports and having to apply but never getting a response until after the deadline!!