When you register a new limited company or Limited Liability Partnership in the UK, Companies House will tell HMRC that it has been incorporated. Soon afterwards, you should receive a letter from HMRC at your registered office address. This letter will contain form CT41(G) ‘Corporation Tax – Information for New Companies’. It will include your company’s 10-digit Unique Taxpayer Reference (UTR) and explain what information you need to provide to HMRC about your new company, and how to set up an HMRC online account for Corporation Tax.
All companies are classed as dormant until they begin a business activity, such as starting to trade, providing services, earning interest, or receiving any other form of income. If you are not going to do any of these activities through your company straight away, or you have registered a company for the sole purpose of protecting a business name, you need to tell HMRC as soon as possible that it is dormant.
To do this, you should use the dormant company insert on the form you receive from HMRC and return it by post. Alternatively, you can call the Corporation Tax Office to report your company as dormant. You won’t have to provide any information other than the fact that your company is not yet trading.
While your company remains dormant, you will still have to deliver confirmation statements and dormant accounts to Companies House each year as well as submit any changes that occur to the company in the meantime (such as a director resigning). You won’t, however, have to send anything to HMRC during that time.
Registering an active company for tax
Your company is active when you begin a business activity. Within three months of becoming active, you must supply information to HMRC about your company and register for Corporation Tax (and VAT, if applicable). The details you need to supply are stated on form CT41G and include:
- Date the company became active you started trading.
- Company name and registration number (CRN).
- Address where main business activities are carried out.
- Nature of your business activities (Standard Industrial Classification (SIC) code)
- Accounting reference date (ARD) provided by Companies House. This is the date your company accounts will be prepared to.
HMRC will use this information to set up a computer record for your company’s tax affairs and determine your accounting period for Corporation Tax. It’s easier and quicker to provide these details online, but you can send the information by post if you would prefer. However you choose to register, you will need to provide your company’s UTR.
If you send the information online, a Government Gateway account will be created and you will be automatically set up to use the Corporation Tax online service. HMRC will send you an Activation Code (also known as an Activation PIN) through the post. To activate the Corporation Tax online service, you must log in to your online account and enter this code when prompted. This code is only valid for a few days and will not be able to submit your tax returns or use any other Corporation Tax online services until you have activated the service.
If you’ve already sent this information to HMRC when you set up your company at Companies House, you will need to set up your Government Gateway account and Corporation Tax online service separately.
During your registration with HMRC, you will be asked if you wish to appoint an agent (i.e. an accountant or tax advisor) to deal with the company’s tax affairs. If you appoint an agent, they will be able to speak to HMRC on your behalf about your company’s tax obligations, file annual accounts and tax returns, and receive copies of any communications that HMRC sends to you. It would be a good idea to appoint an agent if you are not confident about dealing with HMRC and your tax requirements by yourself.
What is my company’s Unique Tax Reference?
A UTR is a Unique Tax Reference. The code you are given is unique to your company. HMRC will use it as a reference every time you contact them and all of the tax information about your business will be stored against your UTR. It is important to keep your code secure, so only you and your appointed tax agent should have access to it.
Company directors are also issued a Unique Tax Reference when they register for Self Assessment. Your UTR is completely different from your company’s UTR. It will relate to your personal tax details, so you will need to use it whenever you contact HMRC about your personal tax and submit Self Assessment tax returns each year.
Company Tax Returns and Corporation Tax payments
When your company is active, you will have to pay Corporation Tax on any profit generated during each accounting period. The deadline for paying tax is 9 months and 1 day after the end of your accounting period, which normally covers a 12-month period and corresponds with your company’s financial year. Typically an accounting period is 12 months long and will match your 12-month financial year. Tax returns must be delivered to HMRC online every year. The deadline is 12 months after the end of each Corporation Tax accounting period.