Everything You Need To Know About Company Tax Return

 

Most businesses file a company tax return with tax authorities each year to report on their earnings, losses, loans, and any other factors that affect their tax liability. Companies use this data to figure out how much Corporation Tax they owe.

The following items are included in a completed company tax return:

·         A CT600 form  

·         Company's books and records

·         Company's tax returns

·         Any more documentation

If tax authorities deliver a 'notice to deliver a company tax return,' the company must file a tax return. This normally happens immediately after a company's accounting year ends. A company tax return must be completed within 12 months of the end of the accounting period it covers. 

How to File a Company Tax Return

Companies can use tax authorities’ website or third-party software like to file company tax returns. Companies can file their accounts with companies’ house at the same time as their company tax return, as long as both reports are for the same accounting period. Tax returns for corporations can be completed by the corporation or by an accountant. 

Who is Required to File a Company Tax Return?

After receiving a 'Notice to deliver a tax return' from tax authorities, limited companies must file a Company Tax Return. If tax authorities consider a limited company to be "dormant for Corporation Tax," it may be exempt.

Limited liability partnerships are not required to submit a company tax return in most cases, although they may be required to do so if they are:

In liquidation, if you are not operating a business with the intention of producing a profit, you will be shut down by a court order. Sole traders and partners in a partnership are not required to file a company tax return, but they must disclose their earnings to tax authorities via Self-Assessment. 

Returns on Taxation

The self-assessment method allows a corporation to file a company tax return, allowing the tax authorities to rely on the information provided. When a business is unsure how much tax it owes on a specific item, it can request that the tax authorities investigate and issue a binding private judgement. 

A corporation's tax return must be filed with the tax authorities by the 15th day of the seventh month following the end of the relevant income year, or by any later date allowed by the commissioner of taxation, in most cases. If your tax return is filed by a registered tax agency, you may be given more time. 

Tax Audit Process

The tax system for businesses is self-assessment; nevertheless, tax authority’s monitors compliance to ensure businesses are paying their tax obligations. The tax authorities will use the OECD's justifiable trust concept, in which it will look for objective evidence that would cause a reasonable person to believe a given taxpayer paid the correct amount of tax and would adjust its assurance strategy depending on the taxpayer's unique company profile.

This essentially indicates that the tax authorities will take a risk-based approach to compliance and audit activities, focusing emphasis on taxpayers who have a higher likelihood of non-compliance and/or larger non-compliance repercussions. General risk assessments, questionnaires, and evaluations of policies and procedures are all examples of compliance activities. 

Key Features of Company Tax Return 

The company's structure in this case is as follows:

·         It must obtain a tax file number (TFN) and use it to file an annual tax return

·         It owns the money that the company makes - the people in charge of the company can't take money out of it unless it's in the form of a formal profit or wage distribution.

·         It must file an annual tax return for their business

·         It pays the corporate tax rate or a lower corporate tax rate (if a base rate entity)

·         Small business concessions may be available. 

Conclusion

Staying on top of changes in tax rules and regulations, which happen on a regular basis at all levels, is vital. Because of the regular changes in tax legislation, keeping up with the ever-changing rules and regulations that apply to businesses can be difficult.

This is particularly tough if your company has a presence in multiple states, and you must submit taxes in multiple jurisdictions. A good tax and accounting research tool could come in handy in these cases.