23 Tax administration for a company Flashcards
When do companies need to submit a corporation tax return?
Within 12 months after the end of the period of account or three months after the notice
When do companies need to pay corporation tax?
Within 9 months and 1 day after the end of the accounting period
Who needs to tag accounts? iXBRL
The items to be tagged are those which appear in ‘taxonomies’. HMRC has published minimum tagging lists for UK GAAP, UK IFRS and corporation tax computation taxonomies.
When must a company inform HMRC they are liable to corporation tax?
Within three months of its first accounting period
What is the time limit for notifying HMRC of chargeability?
12 months from the end of the accounting period in which the liability arises.
What sort of records must companies keep?
All receipts and expenses
All goods purchased and sold
All supporting documents relating to the transactions of the business, such as accounts, books, contracts, vouchers and receipts.
How long must records be kept for?
Later of 6 years after the end of the accounting period, date on which compliance check is completed and the date on which it becomes impossible for a compliance check to be starter
When will HMRC correct errors?
within nine months of the date that the return is filed with them.
When can a company amend its return till?
Within 12 months of the filing date
When can a claim for overpayment relief be made?
Within four years of the end of the accounting period to which it relate
When is the payment deadline for companies that are not large?
Nine months and one dat
When is the payment deadline for large companies?
By quarterly instalment payments
What is the definition of a large company?
Profits more than 1.5 million
What are augmented profits?
Total taxable profits plus dividends received from non-group companies
What is a 51% subsidiary?
A company where more than 50% of the ordinary share capital is directly or indirectly owned.
What companies are are excluded from being apart of the 51% group companies?
Dormant companies
What happens when a company joins or leaves the 51% group?
If they join they are deemed part of the group from the beginning of the following accounting period.
If they leave they are deemed to be a part of the group until the end of the current accounting period.
What are payment instalments based on?
They are based on the expected corporation tax liability for the current account period.
When are payment instalments due?
By the 14th day in months 7, 10, 13 and 16 following the start of the accounting period
What are the two types of interest?
Late payment interest - 3% p.a.
Repayment interest - 0.5% p.a.
When is late payment interest run from?
The normal due date to the payment date.
Is interest paid on corporation tax to HMRC a deductible expense?
Yes
When does repayment interest run from?
The later of the due date or the date of actual repayment to the date of repayment.
What are the penalties for late filing of a corp tax return?
Within 3 months of filing - £100
More than 3 months - £200
6 - 12 months - additional 10% of tax outstanding 6 months after filling date
More than 12 months - additional penalty to 20%
What are the penalties for failure to keep and retain required records?
Up to £3,000 per accounting period
What must HMRC do before commencing a compliance check?
Must provide written notice.
What can HMRC demand a company produce?
- Documents
- Accounts
- Other written particulars
- Full answers to specific questions
When must a compliance check must be done by?
12 months after the actual submission date
If a company becomes large during an accounting period, they do not need to make payments until?
They reach 10 million
They was not a large company in the previous accounting period.
Dividends from what group is not included?
51% group
When are instalments never due?
When below £10,000
