There are a number of benefits to being a limited company, especially the limited liability aspect. However, the amount of administration and the legal requirements of a limited company can prevent a business from applying for incorporation. There are strict filing requirements for a limited company, dependent on whether it is classed as a small or medium company. It’s important to remember that filing requirements for HM Revenue & Customs (HMRC) are completely separate to requirements for Companies House, where all companies are registered, and should be treated as such.
If you have an active limited company, you should inform HMRC within three months of the date your company starts to trade or starts activity in the business. Typically, a form CT41G will be sent to your registered office a few days after being registered at Companies House. Filing requirements for HMRC, and all payments, must be made electronically. The deadline for Corporation Tax will depend on the turnover of your company but is to be paid before the deadline for submitting your company tax return.
The statutory filing date is the deadline for submitting a company tax return. The company tax return and any accompanying documents should be filed up to 12 months after the accounting period ends. An automatic penalty will be sent to you if you miss the filing date, even if you do not owe Corporation Tax. HMRC also requires a full set of company accounts with a director’s report and detailed profit and loss accounts.
You must submit an annual return to Companies House which gives details of:
• company directors
• a company secretary, if one has been appointed
• the registered office address
• share capital
The deadline for submitting an annual return is either 28 days after the yearly anniversary of the incorporation date, or 28 days following the date of the previous return. There is also a fee for the submission of the annual company return.
Accounting records must be kept by all companies. Accounting records should usually be kept at your registered office address although they can be kept at another address which is deemed suitable by your company’s directors. The accounting records are to be made available for inspection by the company’s officers at any time. A private limited company has to retain accounting records for three years and a public limited company must retain these records for six years.
Accounts have to be prepared by the company director for each financial year. Included in the accounts must be a profit and loss account, a balance sheet which is signed by the company director and notes to the accounts. If your company is the parent company of any other companies, group accounts must also be included. The first accounts for a company must start on the date of incorporation and not the first day of trading.
The accounts are made up to the accounting reference date which is the last day in the month of the company anniversary. For instance, if a company was incorporated on 6th April 2010, its first accounting reference date would be 30th April 2011. Every financial year, the accounts have to be sent to each member of the company and also Companies House. Not submitting company accounts by the deadline to Companies House is a criminal offence and you could face a penalty. Failure to submit company accounts could also result in prosecution.
Different regulations apply to small, medium and large companies so you should ask a professional for advice. Although you may receive general guidance from Companies House, they are not allowed to provide specific advice for your company.
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