January 30th, 2017 / Insight posted in The Sunday Times Business Doctor

Business Doctor: Can I change filed accounts?

DJ writes: I have just filed my company accounts and corporation tax return for 2016 and I was overdrawn on my director’s loan account. I have since identified about £15,000 of expenses I paid on behalf of the company. Can I amend my corporation tax return to reduce my payment?

The filing of amended accounts and corporation tax returns is permitted within certain deadlines, writes Jamie Sherman, partner at Kingston Smith LLP. Here, the corporation tax saving of about £3,000 is substantial, so it is well worth considering. A further cashflow advantage may be available as your director’s loan account was overdrawn.

You have up to 12 months after the original deadline to amend the tax return and file it with HM Revenue & Customs. If you have yet to pay your corporation tax, file as soon as possible to prevent an overpayment to HMRC, because it will be expecting a payment as per the original return.

With the financial position of the company changing, amended accounts will need to be lodged with Companies House in paper form, which can be done at any time. These will then align with the revised figures reported to HMRC on the corporation tax return. The new accounts must state “amended” throughout.

The original accounts will remain available at Companies House and can be removed only with a court order. Amended accounts may raise questions if you try to obtain finance, so it is best to avoid them in future.