Why DIY Corporation Tax Returns Are A False Economy
There's a lot more to it than you think ...
If you are planning on doing your corporation tax return yourself, you'll need to set up an online account with HMRC. This is because all corporation tax returns must be filed online ...
Most companies use an accountant to handle their corporation tax returns for a reason!
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Doing it yourself also means using HMRC's free templates, or buying commercial software that can file the corporation tax return in the iXBRL format HMRC requires. Check out the HMRC website for more information about this, but please note, HMRC withdrew some of their free software in last December!
It is really important to remember that you have to file the company tax return, your own tax calculations and your financial accounts. There is much more to it than just filling in an online form!
Although you will have filed a set of accounts with Companies House, you will have to file a slightly different and more comprehensive set with the taxman. HMRC provide a template so that you can enter the relevant information and it will convert your accounts into the iXBRL format they require.
"You also need to prepare an adjusted profits tax calculation!"
The numbers in the corporation tax return are based on the profit and loss shown in your financial accounts. These then need to be adjusted by preparing an adjusted profits or tax calculation because some corporation tax reliefs and allowances are different to the accounting reliefs and allowances.
Some of these adjustments can be quite technical and involved. The corporation tax return includes this tax calculation, which shows how the profits in your financial accounts have been adjusted to get to the taxable profits included in the corporation tax return.
Most companies use an accountant to handle their corporation tax returns for a reason! As well as dealing with the complexities of preparing accounts and filing the return, you can expect your accountant to make sure you are making the most of various tax allowances and reliefs. As an accountant myself, yes, I clearly do have a vested interest here, but doing it yourself really can be a false economy as you could be missing out.
"After all, if you think a professional is expensive, wait until you see the final cost of using an amateur!"
I'd love to make the preparation and submission of your corporation tax returns as simple as I make it for my other clients. And who knows, maybe my fees will be offset by the savings I'll make you with allowances and reliefs you are unaware of?
You should call me on 0333 335 0422, or click here to send me an email enquiry and let's arrange an initial meeting to see how I can help you.
Until next time ...
I've been an accountant in and for business since 1987 and have a wide experience of consultancy, audit, accounts, taxation and wealth planning work from individuals and small businesses to multinational corporations and charities.
My eclectic interests in growing and developing business span a number of areas … and can be summarised as strategic business advice and tax saving advice.
I have worked with the Chamber of Commerce to deliver courses for people about starting up in business and have lectured about tax for a major accountancy practice and for Milton Keynes College.
I relax by reading fiction and by getting away from the office in a campervan.