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If you are reading this article, you’ve either just started a new limited company or possibly looking at this option of trading rather than that of a sole trader. Typically the reasons for using a limited company would be to reduce your Tax burden, but running a limited company carries some addition and extra responsibilities.

Annual Obligations

Companies House

  • Annual confirmation statement for Companies House. This is a straight forward form that requires the directors to disclose details of the directors, shareholders. This form is required on the anniversary of the company incorporation and you have two weeks to file the return.
    • No penalties are payable if you file this return late, but Companies House can apply to close down your company if this form is not completed. Typically it would take around three months before Companies House to start these actions
  • Annual micro-entity accounts prepared using Financial Reporting Standards. This essentially means the accounts need to be prepared using International methods that makes it easier for users to understand and compare data. Generally this would be a job for your accountant. The accounts essentially report your company’s balance sheet, which is essentially a summary of your assets and liabilities, i.e. plant and machinery, trade creditors, cash in bank. This information is publicly available on the Companies House website.
    • Penalties apply for late submissions and Companies House come down hard in this area. The accounts are due 9 months after the year end, but the penalties increase rapidly for later filings:
      • Up to 1 month – £150
      • 1 to 3 months – £375
      • 3 to 6 months – £750
      • More than 6 months – £1,500
    • Furthermore, if you are late in filing accounts for two years in a row, the fines are doubled. It is therefore essential that the accounts are filed in a timely manner.

HMRC

  • Annual Corporation Tax return to be filed within twelve months of the year end. This would usually be done at the same time as filing the accounts with Companies as essentially the same figures are reported.
    • Like with Companies House, late filing penalties apply, £100 for up to one month, £100 after three months, estimations of Tax charges and Tax geared penalties apply for six months and beyond. It is therefore quite important these are filed on time.
  • Personal Tax return for the director. These carry similar penalties to late Corporation Tax returns. These are due 31st January following the retrospective fiscal year which ends on 5th April
  • Corporation Tax payments are due nine months after the company year end, the same time your Company Accounts are due.

Summary

In summary, you can appreciate that there is a few obligations when it comes to running a limited company. If you are using Edgemark Accounting as agents for your company affairs, rest assured that we will be on top of each and every aspect above and would aim to file all documents well within the reporting deadlines.

For more information, please don’t hesitate to get in touch: