How to File a Company Tax Return: The Complete Guide
Businesses around the UK will need to pay Corporation Tax every single year. Before you can do this, you need to fill in and filed a company tax return.
This is typically referred to as form CT600, and it is necessary to help you figure out if you need to pay any Corporation Tax or not. Even if you have made a loss or don't believe you need to pay any tax, you will have to file your company tax return before the deadline or risk being penalised by HMRC.
Those of you that may have spent some time self-employed will know that a self-assessment tax return needs to be filed by the same date every single year. Things are different with a company tax return; the deadline depends on your company's accounting period.
You will need to file your company tax return
12 months after the accounting period ends - and this relates to the accounting period the return will cover. You can find out when your accounting period ends by looking at your business tax account on the HMRC website.
Keeping all of this in mind, how do you fill in form CT600 and file your company tax return?
What you need before filing the return
First of all, you need to have some information handy to help you fill in the return with as little stress as possible. It helps to get everything together before you start filling in any forms, this stops you from getting to a page, then needing to look for the relevant information somewhere in the office.
So, here's what you need:
● Taxable profit earned by your company - this includes any tax allowances or business expenses subtracted from your total income. Don't forget about multiple revenue streams if you generate income from various sources. Naturally, this also means you will need information on all your business expenses and taxable allowances.
● Your login details - if this is your first time filing a company tax return, you will need to generate some login details for the government website. You can do this by heading to the gov.uk website here and filling in your email address. You'll be sent a code that then provides you with your Government Gateway ID and a password. Keep these safe as they will be used to log you in every time you file a company tax return.
The second point is a key one; this is all filed online via the government website. HMRC is actively trying to stop people from filing paper forms unless you have a reasonable excuse as to why you're unable to file it online.
Businesses that file their returns in Welsh will fall into this category as it's currently not possible to file a Welsh company tax return online, so the paper version will be needed instead.
Filling in the CT600 form
Once you have all of your information handy, and you've logged into your account, you can choose to file a company tax return. It's all self-explanatory on the government website, and you will eventually be presented with the digital CT600 form.
It's 11 pages long, which might seem very daunting, but there is some good news. HMRC creates a universal form for every business, meaning many of the questions only relate to specific types of businesses. Thus, a lot of the questions will be left blank for you as they aren't relevant.
Below, we've provided a look at the main sections and boxes that you will definitely need to fill in on your return:
● Boxes 1-4: Company Information - A straightforward section; this is where you fill in all of the company details. You need to input your company name, registration number, tax reference, and the type of company you are.
Following this, there is a Northern Ireland section (boxes 5-8) where you need to tick the boxes if appropriate. This is only for businesses that trade in NI or are based there.
● Boxes 30-35: About This Return - Here, you need to provide details on the dates that this return will relate to. In essence, it's your accounting period.
● Boxes 40-75 in the About This Return section aren't relevant to everyone and simply ask you to tick any of the appropriate boxes on the form.
● Boxes 80-85: About This Return - Still in the same section, these are the next boxes everyone will have to fill in. This is where you stipulate if the attached accounts are for the period stated above, or if they relate to a different period.
● Boxes 145-150: Turnover - A very important section, this is where you place your company's turnover for the relevant period. If you don't have a turnover, you leave 145 blank and put an x in 150.
● Boxes 155-205: Income - This is simply where you put in all the numbers relating to your income. Each box is clearly labelled with what you need to include, such as trading profits, trading losses, and so on.
● Boxes 210-220: Chargeable Gains - Input your gross chargeable gains, along with your allowable losses. Box 220 makes you take your allowable losses away from your gross chargeable gains to find your net chargeable gains.
● Boxes 225-235: Profits Before Deductions and Reliefs - Boxes 225 and 230 let you specify any losses you've made. Box 235 finds your profits before other deductions and reliefs, which is the sum of boxes 165 to 205 and 220, minus the sum of boxes 225 and 230.
● Boxes 240-325: Deductions and Reliefs - Here, you can make notes of any trading losses, expenses and reliefs.
● Boxes 330-440: Tax Calculation
- Fill in all of the boxes with your figures to find out how much corporation tax is due.
That's basically all you need to fill in, and the most challenging part is finding and working out all of your deductibles and expenses. It's essential that you file your return before the deadline or you can be hit with fines.
Currently, HMRC sets the following fine rates:
● £100 penalty if it's a day late
● £100 penalty again if it's three months late
● 10% of your estimated corporation tax bill if it's six months late
● Another 10% penalty if it is twelve months late
It's crucial that you file your company tax return on time and that all of the information is accurate. If you need help doing this, working with qualified business accountants can make the whole process a lot smoother. Feel free to contact Smart Solutions Taxation & Accounting today to see how we can be of assistance.