There are many financial deadlines that company directors need to know and manage. In an ideal world your accountant will be managing this aspect of the business on your behalf, but how do you know if this is the case?
Given that it’s the directors that are ultimately responsible for ensuring the company meets its legal requirements, it’s sensible to be aware of your responsibilities.
All UK registered companies need to submit accounts to the UK registrar (called Companies House) each year. These accounts need to be submitted within nine months’ of the end of an accounting period (or, if your accounting period is longer than 12 months, within nine months of the anniversary of the start of the accounting period).
Most companies in the UK are classified as “small” companies and are entitled to submit Abbreviated Accounts, which exclude Profit and Loss information. As anyone can now download a set of company accounts for free – including competitors and nosy neighbours – most directors choose to submit Abbreviated Accounts if permitted to do so.
Company directors often confuse the Annual Return with the Annual Accounts but they are in fact very different documents. The Annual Return states various facts about the company and is prepared annually, providing information correct as at the anniversary of the Company’s incorporation (it’s birthday in effect). This needs to be submitted within a one month window.
If the Company has started trading, it must submit a corporation tax return to the UK tax authority (HMRC) within twelve months’ of the end of a tax return period. Unlike a set of accounts, a tax return cannot cover a period greater than 12 months, so it’s possible to have two tax returns covering one accounting period. Any tax payable must be paid with nine months of the end of the tax period.
Directors have a responsibility to keep good financial records. That’s why bookkeeping is so important. Bookkeeping should be completed throughout the year and at least once a month, in order to have an up-to-date picture of how the company is doing. Your bookkeeping will need to be completed before for the accounts production can start.
Personal self assessment tax return
As a company director you will be required to prepare an individual tax return to HMRC. Your individual tax year will most likely differ from your Company’s year-end. The personal tax year follows the UK fiscal year (up to 5 April). This Return needs to be submitted and any outstanding tax paid to HMRC by 31 January (i.e. nearly 10 months after the tax year has ended).
As the Company grows, it may also need to consider VAT and PAYE as well. Given the numerous deadlines and requirements, it’s sensible to speak to an accountant and leaves you to concentrate on growing your business!