Preparing and Submitting Annual accounts for Companies House and HMRC

Ryan Patrick

• 12 min read
Preparing and Submitting Annual accounts for Companies House and HMRC

After registering a company in the United Kingdom, there are some reports you have to send to the Companies House and HMRC every year.

These annual reports are legally backed up and must be met by all companies in the United Kingdom or else the company will face sanctions from Companies House.

These annual reports include the company's directors, shareholders, subscribers and other necessary information about the company. Income, expenditures and other financial reports are also included in the annual report the company submits to Companies House.

Preparing annual reports as a company in the UK is very important or else your company will face sanctions. This blog shows you how to prepare and submit annual accounts to Companies House and HMRC.

What is a Confirmation Statement?

Even if your company is dormant, you're mandated to send your confirmation statement annually to Companies House.

This confirmation statement is to confirm that all the official details of the company on official documents and public records (companies register) are correct without any errors.

The confirmation statement replaced the company's annual returns in 2016 and since then, it has been legalised and compulsory for all companies in the UK.

The following is information you need to check out and confirm on the confirmation statement (company house form CS01)

  • Companies name
  • Companies registration number
  • SAIL address
  • Office address (registered)
  • Details of the directors and company's secretary (appointed officers)
  • Details of persons with significant control (PSC)
  • Details of subscribers
  • Principal business activity (SIC code)
  • Shareholders details
  • Shares trading status

Once you've checked all this information and they are correct on the Companies House register, you will need to get the Companies House form CS01 and fill out the following details

  • The company's number
  • Company's full name including limited or LTD at the end.
  • Date the statement was signed
  • Signature if the director or the company's secretary

You can choose to go for an online submission or a postal submission of the form CS01. After filling up this necessary information, you send the form to the Companies House.

However, if you want to change or update your SIC code, shareholders information, statement of capital or even the treading status of the company, you'll need to update them on parts 1 and 4 of the confirmation statement.

If you're reporting a mistake, change or any other errors in your company's information, you can choose to fill out other forms before writing out your confirmation statement or even write them out together with your confirmation statement.

Deadline for Submitting Confirmation Statement

A confirmation statement is submitted to Companies House every 12 months and failure to do so can result in sanction.

The 12 months between the submission of one confirmation letter to the submission of the other is called the review period.

This review period is the period where you go through all your company's information and review it, then you write a confirmation statement when she.

The review period can start on two occasions

  • The date of formation of the company
  • The date on the last confirmation statement was submitted.

The statement must be delivered no later than 14 days after the due date for the confirmation statement.

What are Annual Accounts?

All companies including Dormant companies, must submit annual accounts to the Companies House.

The annual account is the total of all your financial activities in a financial year summarised into a more presentable account.

After the formation and incorporation of your company, the deadline for the first annual accounts is due within 21 months after the incorporation.

After the first financial year, then the annual accounts are submitted 9 months after the end of a company's financial year.

Types of Annual Accounts

The type of annual account to prepare depends on the size of your company and whether your company is dormant or not.

  • For large companies, the statutory account should be prepared.
  • For smaller companies, small accounts like simplified or abridged accounts should be prepared.
  • For micro-entities, micro-entities accounts are prepared. This micro entity account is simpler than the simplified and abridged account for small companies.
  • Dormant companies should prepare dormant accounts. Even though your company is dormant, you cannot stop preparing your annual account after each successful financial year.

Company Filing Requirements by HMRC

Once your company is incorporated, you're eligible for tax payment and you must pay your corporation tax and prepare tax returns to the HMRC.

Corporation Tax

After successfully registering your company, registration for corporation tax must be done within the next 3 months after your company starts trading.

You might choose to register for corporation tax on the day your company is registered if your company starts trading right away.

You can also do it later if your company has been dormant and just started trading. In other words, registering for corporation tax is a must and if the company fails to do so, it can lead to dissolution.

To register for corporation tax online, you need some necessary information about your company to be submitted to HMRC. The information needed for registration of corporation tax includes

  • Your company's name
  • Your company's registration number
  • The date your company started doing business or trading.
  • The date your last annual account was made up to.

Some other requirements are

Unique Taxpayer Reference(UTR): this is a ten-digit unique number sent to a company by HMRC after incorporation of the company. The HMRC will post the UTR to your company within 14 days of incorporation. The UTR digits are used for

  • Create a government gateway account online
  • Complete your corporation tax registration
  • Send company tax return to HMRC
  • Send annual accounts to HMRC
  • Pay your corporation tax bills.
  • Preparing Tax Returns. If preparing the tax returns for HMRC, you must also prepare annual accounts to send to HMRC annually. If your company is registered for corporation tax, the filing requirements as long as it is a limited company include
  • Preparation of company tax return, using the CT600 Form
  • Full statutory accounts for HMRC

If your company is dormant and inactive, you don't need to prepare the company tax return and annual account for corporation tax. Since your company is dormant, you don't have to pay corporation tax till you revive your company.

Also if your company is dissolved, none of these fillings will apply to your company so you don't have to do any of them.

Deadline for Delivery of Company Tax Returns and Corporation Tax Bills

Company tax returns must be delivered to HMRC in 12 months after the end of your company's annual account.

Corporation tax bills must be sent to HMRC on or a day after the 9th month after the end of the Company's accounting period.

VAT and PAYE

All companies have to register for VAT, file their VAT returns and always pay their VAT if their yearly income is more than £85,000(this threshold was as of the new 2024/24 threshold).

You can also voluntarily register for VAT if your company's yearly income is less than the threshold which is £85,000.

If your company has employees and directors who are receiving their salary through payroll, then you must register for PAYE. If your company does not have directors and employees, then there's no need to register for PAYE since you don't make use of payroll.

Directors also have to register for self-assessment and prepare tax returns for the personal income they receive without tax.

Shareholders are also registered for self-assessment since they also receive income from the company in the form of shares.

These personal income of directors and shareholders include,

  • Dividends from shares
  • Personal expenses
  • Loans the directors receive from the company.
  • The directors and shareholders should ensure to register for self-assessment. In this self-assessment, the tax is received annually.

If you did not receive any personal income from the company in a year, then no tax returns will be prepared.

What Changes  Should I  Report to Companies House and HMRC?

A limited company must file changes in the company's information to Companies House and HMRC. These changes are better off reported earlier to Companies House and or HMRC since there can be sudden inspection by Government agencies or even by the Companies House.

The following are changes you should report to Companies House or HMRC

  • Change in the company's full name.
  • Replacement of the company's registered office address.
  • Replacing or adding another SAIL address.
  • Change in the location of the company's statutory records and register.
  • Adding, removing or replacing a director or a company's secretary.
  • Alter the details of a company's shareholder, director, subscriber or secretary.
  • Changes in the persons with significant control (PSC) register.
  • Transferring of shares by shareholders.
  • Issuing of shares by the company.
  • Changing or replacing anything in the article of association.
  • Changing the company's share capital.
  • Changes to the SIC code of the company
  • Changes regarding the Accounting Reference Date (ARD) of the company.
  • Reporting your company as dormant.
  • Requesting a change of your company's status from dormant to active in trades and businesses.
  • Appointing an accountant or a tax advisor.
  • Changes in the accounting period for corporation tax.
  • Details of the company's VAT and payroll.
  • Details of directors and shareholders self-assessment.

Some changes require an urgent report to get Companies House. This urgent report should be made within 14 days after the change has been made to the company. These urgent reports include

  • Changing the company's registered office address and location.
  • Changing the company's statutory records and registers.
  • Adding or removing a director.
  • Adding it removing a secretary
  • Changes in the registered details of the directors, shareholders, subscribers or secretaries.

If your company issues more shares and increases its share capital, you must deliver a "Return of Allotment of Shares" in 1 month to Companies House.

The majority of these changes can be reported to Companies House online with no charges attached through the Companies House WebFilling. Any changes done in your company must be registered in your company's statutory records and registers.

Companies Act 2006 requires limited companies to record several statutory records and registers at their registered office address. Some copies can also be kept at the company's SAIL address if the company uses a different address.

The changes must be recorded in the appropriate register or records and should be easily accessible in the case of an inspection. Also, companies should ensure to record these changes immediately in their records and registers because of sudden inspection by government agencies.

Who is Legalised to File Requirements of a Limited Company?

In every company, only the director is legalised to fill company requirements in the company. Filing requirements are supposed to be done by secretaries or accountants of a company. But following legal instructions, only a director should fill the company's requirements.

A director should also keep up to date with the filing requirements to submit them in time at Companies House or HMRC.

Sanctions for Failure to Maintain Filing Requirements by Companies

If a company fails to file requirements as a limited company, this can attract serious sanctions to the company. These sanctions include

  • Financial sanctions
  • Prosecution
  • Director disqualification
  • Forceful company dissolution

Forceful company dissolution is mostly done when the company does not file requirements more than once. If the company just missed filing requirements just once, lighter sanctions can be given to them.

What Are the Annual Filing Requirements for Dormant Companies?

As a dormant company, the following are some filings to be done.

Filing of confirmation statement at Companies House once every 12 months. This is mandatory and must be met. Even as a dormant company, the company's account must be prepared and submitted at the Companies House every year.

Changes in registered details of the company must be reported to Companies House and or HMRC as soon as possible. You must report your company as dormant to HMRC to avoid accumulation of tax.

As a dormant company that wants to get active in trade, you must also send a filing to Companies House and HMRC about your company no longer being dormant.

Balance Sheet

A balance sheet is a financial statement that provides details of the assets, liability and shareholders' activities at the end of the company's financial year.

This explains what the company owns, its debts, its expenditures and other financial activities and illustrates the financial value and health of the company during the time the balance sheet was prepared.

Assets

Assets of a company are valuable items owned by the company. These valuable items range from buildings, lands, vehicles, plants, animals, machinery, furniture, cash, money in the bank, stocks, equipment and other materials.

These assets, in the case of a liquidation or dissolution, will all be sold out and the money used for paying off debts or given to shareholders.

Liabilities

Liabilities are money and other items owed by the company. Including loans, tax obligations, mortgages, pensions, accounts payable, accrued payroll and expenses, customer's deposit, dividends payable and any other liabilities.

Liabilities are divided into short-term liabilities (also known as current liabilities) and long-term liabilities.

The balance sheet helps to indicate the company's liquidity, debts, value and financial health. After examination of the balance sheet, if the company's assets are higher than the company's liabilities, then the company is healthy financially.

If the company's liabilities are greater than the company's assets, then the company is having bad financial health.

If the liabilities are greater, it means the company is in debt and needs to be looked up to or it will lead to liquidation of the company.

What is the Profit and Loss Account?

The profit and loss statement of a company or organisation shows all the transactions the company made within a certain period (which is usually 12 months).

This statement is to show whether the company has made a profit or loss during this period of 12 months.

  • The profit and loss statement include
  • The company's income
  • Minus the cost of sales and other business expenses
  • Minus mortgages or rent
  • Minus utilities, loan repayment and interest
  • Minus wages, pensions, corporation tax and VAT.

After all the calculations have been made, the figures remaining at the end of this statement will determine if the company had a profit or loss during the financial year.

If there is profit at the end of the financial year, the company can then issue dividends to its shareholders. After issuing dividends to its shareholders, the profit that remains will be reinvested into the business.

What is the Director's Report?

Director's report, prepared by the company's board of directors. This is a financial document that must be included in every large company's annual account. Small companies and micro entities do not submit this report as they are exempted from this report.

The director's report helps to analyse and summarise the company's financial health and position. It is also done to manage and monitor the performance of the company. The director's report also includes the prospects and strategies to achieve the prospects of the company.

The information helps the company members also to understand the company's activities and how well the company is doing.

  • The director's report should contain the following information
  • Names of all the current directors of the company during that particular financial year
  • Market analysis of the company's performance
  • The company's current financial position and health
  • A comprehensive description of the company's business activities, objectives and strategies (that is what the company does and how they do it.
  • Market analysis on the current state of the market the company operates and also the future viability
  • A summarized description of the company's future developments
  • Market trends or any other trends that are likely to affect the company's marketing, performance, and financial health.
  • How liable is the company to growth and development
  • The risks or difficulties the company has faced during the financial year and those that they are likely to face in the future
  • Description of how the company has managed its risks and difficulties in the financial year
  • Important changes regarding the company's fixed assets in that financial year
  • Important activities that affected the company's financial health positively or negativity after the date on the balance sheet
  • Whether the directors, employees, secretaries or other persons in the company are abiding by the company's rules and regulations
  • The company's recommendations for dividend payment

The director's report helps the company and its members to analyse the company's activities, its financial health and also market analysis regarding the company's trades and other significant activities.

What is the Auditor's Report?

An auditor report is a documented sincere evaluation of the company's annual account. This is carried out by an external auditor or a chartered accountant. An auditor's report should contain the following

  • The role of the auditor and the directors of the company
  • A statement that a set of standards of accounting practices was used as a guide to the audition
  • It should state if the account was prepared according to the UK General Accepted Accounting Practice (GAAP) and by the Companies Act of 2006
  • If the financial statement of the company regarding the company's assets, liabilities and financial health are all true
  • Any extra important information or statement regarding the company's annual accounts

Private companies must audit their accounts except in cases where the company is a small one and has requested an audit exemption. Even if the company has been granted an audit exemption, if a shareholder owning more than 10% of the company's shares requests an audit, then the company must get an auditor for the company's annual accounts.

Form your company with Incorpuk today

At Incorpuk, we will help you file accurate information when you register your company through us. We will help you with incorporation articles, a registered office address, and all you may need to register your company in the UK. Contact our team if you seek any information; we will gladly assist.

Conclusion

As a registered company in the UK, you must submit annual accounts or filing of your company to Companies House and or HMRC. This annual report helps to analyse the performance of your company during that financial year. This analysis is done by the company itself, Companies House and HMRC to see if the company is still fit to continue trading. A dormant company is also required to fill out some annual reports to Companies House and HMRC. It is important to submit your annual reports to Companies House and HMRC to avoid sanctions such as financial sanctions, sanctioning of the company's director(s), or dissolution.  If you have any questions on annual accounts kindly contact Incorpuk for help today.