Corporation Tax

[Alan @ BroomeAffinity]

The correct timings are 9 months and one day after the company's year end to pay the corporation tax due and a year and one day after the company's year end to file the CT600 return.

Stanhope, if you'd like a quick 20 minute chat on the phone I'd be happy to see if there is anything that can be done, legally (!), to reduce your CT liability.

PM me if your interested and I'll let you have a note of my phone number.

Regards.

David.

Damn. Beat me to it.

[Bluebird]

Sorry have I missed something, at year-end you calculate your accounts and the CT due.

How do you show in your year-end accounts that you've spent more money that you should have - won't that show as a negative balance at the end of the year?

I know you've got 9 months to get the cash together for the CT, but at the end of the day you're still in a debit situation - unless of course unpaid VAT & PAYE is NOT taken into account for the year-end.

[Zen Contracting]

At the end of the year in question you accrue for the CT that is due. This may well leave the company with a negative balance sheet if it does not have the cash, at that point, to settle the CT bill.

[Bluebird]

At the end of the year in question you accrue for the CT that is due. This may well leave the company with a negative balance sheet if it does not have the cash, at that point, to settle the CT bill.

and is that ok?....

[ratewhore]

I thought that was a big no-no and could lead to a shower with Bubba!!

[ASB]

At the end of the year in question you accrue for the CT that is due. This may well leave the company with a negative balance sheet if it does not have the cash, at that point, to settle the CT bill.

Quite, the negative balance sheet itself isn't a problem - though it may lead to the accounts being qualified. Clearly this can happen to any business if it makes a trading loss at some point.

The problem is the distributable reserves, if these go negative then this would imply that the retained profits have been distributed (OK) and also that dividends in excess of the current year profits have also been distributed. This is a bit of a no no.

What is obviously entirely unclear is the situation the OP Is in. They don't indicated if they have paid dividends, they don't indicate if their problem is currently that they simply haven't got the cash for the CT (which is a perfectly reasonable thing if they are carrying debt on the sales ledger).