Every limited company must submit accounts to HMRC and Companies House each financial year. In this article, we look at what statutory accounts are, and how to work out your filing deadlines.
If you are a limited company director, one of your legal obligations is to ensure that your company’s annual accounts are submitted to HMRC and Companies House accurately and on time.
When are my annual accounts due?
When you first incorporate, your Annual Reference Date (ARD) is set to the end of the month in which you set up your limited company. So, if you formed your company on 12th January 2018, your ARD would fall on the 31st of January each year.
Under typical circumstances, you must ensure that you submit your company annual accounts to Companies House within 9 months.
However, the first time you submit your company accounts to Companies House, you must do so within 21 months of the date of incorporation rather than the ARD.
You must send a copy of your statutory accounts to:
- HMRC (as part of your Company Tax Return)
- Companies House
- All shareholders
- Anyone who attends an Annual General Meeting (AGM)
What do the annual accounts consist of?
The complexity of the accounting documents you need to submit depends on the size of your company. Most small companies are defined as ‘micro entities’, and as a result, the reporting requirements are far less complex than they are for larger firms.
Statutory accounts – to be submitted to HMRC
The statutory requirements for annual accounts – to be delivered to HMRC – include:
- Balance sheet
- Profit and loss account (P&L)
- Notes relating to the accounts
- Directors’ report
- An auditor’s report (not required for small companies or micro entities)
- Signature and name of director(s)
Find out what a balance sheet and P&L are in our beginner’s guide to financial reports.
Accounting information to be submitted to Companies House
Importantly, micro entity companies can choose to submit simplified accounts to Companies House, and the accounts themselves do not need to be audited.
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This minimises the amount of financial information that is displayed on the public record. You will not need to submit the P&L or directors’ reports to Companies House – just the balance sheet.
Is my company a micro entity?
Your reporting requirements are reduced if your business is defined as a ‘small company’, and reduced even further if it is defined as a micro entity.
Your company is a micro-entity if it meets 2 or more of these conditions:
- turnover must be not more than £632,000
- the balance sheet total must be not more than £316,000
- the average number of employees must be not more than 10
Find out exactly what your company’s accounting requirements are via this comprehensive official guidance.
Can I change the Annual Reference Date?
You, or your small business accountant, can change the Annual Reference Date online via Companies House Form AA01.
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The rules for changing the ARD are complex, so you should always take professional advice before making any changes, and you can’t make changes if the accounts for the current accounting period are overdue.
In general, you cannot extend your company accounting period for longer than 18 months, and can only extend your Annual Reference Date once every five years.
For more information on changing your ARD, or on submitting your annual company accounts in general, refer to this Companies House guide.
What about HMRC and Corporation Tax?
All limited companies must also complete a Corporation Tax return (CT600) each year. Your company statutory accounts must also be attached to this return.
Your annual accounts must be submitted within one year of your company’s year-end, although – confusingly – your Corporation Tax liability must be paid within nine months of this date.
As a result, your accountant will typically submit your accounts in advance of the nine-month deadline for obvious reasons.
You can read more in our Corporation Tax guide for small companies.
What happens if I submit my annual accounts late?
This should never happen, assuming you have a decent accountant and have provided the accountant with all of the necessary accounting information before the deadline.
If for some reason, your annual accounts are delivered late to Companies House, an immediate £150 penalty will apply. The amount increases every few months and reaches £1,500 if your accounts are 6 months late. Find out more here.
If you also deliver your Company Tax Return late to HMRC, a separate set of penalties will apply, starting at £100. After 3 months, a further £100 penalty applies, and after 6 months, HMRC will estimate your Corporation Tax bill + apply a 10% tax penalty. If your Return remains overdue after 12 months, HMRC will charge you an extra 10% of your outstanding bill.
In both cases, penalties are increased for repeat offenders, so make sure you meet the deadlines!