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CTM94100 | CTSA: Penalties for late returns: Companies Act extension

From HM Revenue & Customs · Company Taxation Manual

FA98/SCH18/PARA19

When a company that is registered under the Companies Act:

  • has a return period that coincides with a period for which it is required to deliver accounts to the Registrar of Companies,

and

  • the date by which the accounts must be delivered to the Registrar is later than the filing date for the company tax return,

no flat-rate penalty is chargeable under FA98/SCH18/PARA17 if the company delivers its return by this later date.

Under Section 442 Companies Act 2006:

  • a private company must usually submit a copy of its accounts and reports to the Registrar within nine months of the end of the period of account,

  • a public company must usually submit a copy of its accounts and reports to the Registrar within six months of the end of the period of account.

A company that carries on business or has interests outside the UK will be allowed a longer period for delivering accounts in accordance with The Overseas Companies Regulations 2009 (SI2009/1801) dependent on its status.

Companies incorporated in Northern Ireland were incorporated as UK Companies with effect from 1 October 2009 when the NI Registry was integrated with Companies House.

FA98/SCH18/PARA19 applies to these companies.

  • When this provision applies the company is not liable to a flat-rate penalty provided it delivers its company tax return by the permitted later date - see example 1 at CTM94120.

  • If it fails to deliver its return by the later date it becomes liable to a penalty under FA98/SCH18/PARA17 on the basis that it failed to deliver its return by the filing date- see example 2 at CTM94120.

FA98/SCH18/PARA19 strictly requires the company tax return period and the period of account to be the same. In practice, the provision should be applied to:

  • any accounting period that forms part of a longer period of account,

and

  • the date for filing the accounts with the Registrar is later than the date for filing the tax return with HMRC.

This provision does not affect any liability the company may have to tax-related penalties. Paragraph 19 provides an excuse for late delivery of returns but does not itself constitute a statutory filing date. However, when the Secretary of State grants an extension to a date after the date when the company incurs a tax-related penalty, the reason for the extension is likely to amount to a reasonable excuse.

If, exceptionally, there seems to be no reasonable excuse, officers should refer the case to The Specialist Technical Team, see EM21000 before charging a tax-related penalty in these circumstances.