Corporation Tax Return changes…

A Corporation Tax Return is filed with HMRC each year to report a company’s tax liability. We prepare them for our clients once we’ve prepared the annual accounts, and submit them to HMRC once they’ve been approved by the Directors. The format of the Corporation Tax Return has changed recently, and those changes could have a significant impact.

What’s changed?

There are two new boxes on the Corporation Tax Return that must be completed for Returns submitted after 1st April 2021. The first asks a company to declare any amounts claimed under the Coronavirus Job Retention Scheme and the Job Support Scheme. The second asks the company to declare the amounts under those schemes that they were entitled to claim.

For companies who’ve already submitted their accounts, of which we have quite a few, the Corporation Tax Return needs to be amended and resubmitted to include these boxes.

If you’re a client of ours, we’ve amended those that had already been submitted, so there’s nothing practical to worry about.

BUT…

HMRC do not make changes to the Corporation Tax Return without due cause. No-one is likely to put into the second box a figure other than that which they claimed, as they would be highlighting themselves as having claimed something to which they weren’t entitled.

However, we feel the very fact that these boxes have been added suggests that there will be a further increase in the attention paid to amounts claimed under these schemes. 

Our advice therefore remains:

If you have made any claims under any of the Coronavirus support schemes, be absolutely sure that you have very clear records of how much you’ve claimed, why you feel you were entitled to do so and retain those records safely.

HMRC can enquire into a Corporation Tax Return for up to twelve months after its submission, if it’s submitted by the deadline, BUT they can also go back up further if they feel there is specific justification to do so. We would recommend keeping these records for a minimum of six full tax years from the year end after which you made the claim.

As ever, if you’re concerned or unsure about any aspect of the enquiry regime, or receive any contact from HMRC, please get in touch.