Tax Planning for High-Earning Company Directors
One day late. £200. That is what HMRC charges when a Company Tax Return misses its deadline by a single day. Miss it by three months, and you pay another £200. Leave it for six, and HMRC begins to estimate your tax bill for you and adds a 10% penalty on top.
Nobody sets out to be late. In my experience, it happens because the dates are confusing. Corporation Tax has a payment deadline, a filing deadline and a Companies House deadline, and they don't match. The payment date is "nine months and one day" after your year-end, a phrase that sounds like a typo until you've been caught out by it. The return is due three months later. The accounts are due a day before the payment.
I've helped directors across Tunbridge Wells, Tonbridge and Sevenoaks sort out missed deadlines more often than I'd like, and almost every case could have been avoided with a simple calendar. This guide sets out each deadline, explains the accounting period that drives them all, and covers the penalties for filing or paying late. I've kept the examples practical, because the dates only help if you can apply them to your own company.
Before the detail, here is the overall picture. For a company with a 12-month accounting period, there are four dates to know.
There is also the annual confirmation statement at Companies House, which is separate, but which many directors treat as part of the same routine.
Let me take them in the order that matters, starting with the accounting period, because every other date is measured from it.
An accounting period is the length of time for which a company's profit is calculated and taxed. Think of it as the company's tax year, though it needn't match the calendar or the personal tax year. Every deadline in this guide is counted from the date it ends.
For most companies, it ends on the same date every year. A company with a 31 March year-end has an accounting period that runs from 1 April to 31 March.
For Corporation Tax, an accounting period can never be longer than twelve months. This surprises people, because the period covered by your statutory accounts can sometimes be longer. A company's first period of accounts can run for up to eighteen months. When that happens, HMRC splits it into two Corporation Tax periods: one of twelve months, and one for the remainder. Each has its own return and its own payment date.
Here is an example. A company is incorporated on 10 May 2026 and begins trading straight away, with a default year-end of 31 May. Its first set of accounts runs from 10 May 2026 to 31 May 2027, which is a little over twelve months. For Corporation Tax, that becomes two periods. The first runs from 10 May 2026 to 9 May 2027. The tax is due on 10 February 2028, and the return on 9 May 2028. The second runs from 10 May 2027 to 31 May 2027. Its tax is due on 1 March 2028, and its return on 31 May 2028.
Two periods, two returns and two payments, all from one set of accounts. I've met more than one director who discovered the second period only when HMRC's letter arrived.
A new company's year-end is usually set automatically by Companies House as the last day of the month in which the first anniversary of incorporation falls. So a company incorporated on 10 May has a default year-end of 31 May. You can change it, but you can't ignore it.
The first period begins on the date the company starts trading, or otherwise comes within the charge to Corporation Tax, such as by receiving income. That may be later than the incorporation date. It's worth keeping a note of when the first invoice was raised, or the first cost incurred, so your accountant can fix the start date.
A company can change its accounting reference date at Companies House, within limits. A reason might be to line up the year-end with a quiet period, or with a group of other companies. Be aware that shortening a period means two sets of accounts in a shorter time, and lengthening it more than once every five years is restricted. If you're thinking of a change, speak to us first, because it moves every deadline.
An accounting period also ends when a company stops trading, enters liquidation or is wound up, regardless of the usual date. In those cases, a new period begins, and the deadlines follow from the new end date. Closing a company in an orderly way needs a plan, and the final deadlines can be tight.
The Company Tax Return, often called the CT600, is the form on which your company reports its profit and calculates its Corporation Tax. It is accompanied by the company's statutory accounts and a tax computation showing how the accounting profit has been adjusted for tax. These are filed online with HMRC in a specific digital format, which your accountant normally handles.
The return is due twelve months after the end of the accounting period. For a company with a 31 March 2027 year-end, that is 31 March 2028. It's a generous period, and it's tempting to treat it as the date for everything. It isn't. The tax itself is due three months earlier, and the Companies House accounts a day before that.
The company is responsible for filing, and the directors are responsible for the company. Using an accountant doesn't pass the responsibility on, although it does mean someone is watching the dates. If your accountant files on your behalf, make sure they're authorised as your agent, and that you've approved the figures before they submit. The return is a legal statement, and it carries your name.
Annual accounts for a private company must be filed at Companies House within nine months of the year-end. For a first set of accounts, the deadline is roughly 21 months after the company was set up. This is a separate filing from the tax return, and it has its own penalties, which I cover below.
Many directors assume that a filing at Companies House covers HMRC too. It doesn't. They are different bodies with different rules, even though the accounts are usually prepared once and used for both.
Even a dormant company, or one that made a loss, may need to file. If HMRC issues a notice to deliver a return, you must file it, even if the answer is "nil". If you believe the company has no obligation, tell HMRC in writing rather than ignoring the notice. I once helped a Tonbridge director whose dormant company had received three notices over eighteen months, and had ignored them all because "there was nothing to pay". The penalties had climbed into four figures, on a company that had never traded.
Corporation Tax is due nine months and one day after the end of the accounting period. The odd extra day exists because of how the date is calculated. It's a useful warning that the deadline is not the 9-month anniversary itself, and that if you pay on the anniversary you're a day early, which is fine. Pay a day late, and interest starts to run.
To make this concrete, here are the dates for four common year-ends, assuming 12-month periods.
Notice how the tax is always due a day after the accounts, and three months before the return. Put the payment date in your diary first, because it's the one with the interest attached.
The tax must arrive in HMRC's account by the deadline, not simply be sent. Faster Payments transfers generally clear the same day or the next, but cheques and some other methods take longer. Use the payment reference in your HMRC online account, and pay at least a few days early, especially if the due date falls on a weekend or a bank holiday. I tell clients to treat the date as the day it has to be in HMRC's hands, not the day to start.
A Sevenoaks consultant once paid at 4.30pm on the final day, through a bank transfer that took until the following morning. It cost him a day's interest. The amount was trivial, but the point stayed with him.
Companies with profits above £1.5 million, divided by the number of associated companies, pay in quarterly instalments, starting in the seventh month of the period, rather than in one payment. Most owner-managed businesses in Kent fall well below that level, but a profitable group of companies can cross it more easily than expected.
If you can't pay the whole bill on time, contact HMRC before the deadline. HMRC can agree a Time to Pay arrangement, which spreads the payment over a period, although interest still runs. It is far better to arrange this early than to wait for the enforcement letters. The key is to act before the date, not after.
This is also the reason I recommend setting aside 20% to 25% of profit in a separate account as you go. It turns the payment from a worry into a routine transfer.
There are two sets of late filing penalties, one from HMRC for the tax return and one from Companies House for the accounts.
HMRC and the Company Tax Return. If the return is late, the penalty is £200 for being one day late, and another £200 if it's still outstanding after three months. After six months, HMRC estimates the tax you owe and adds a penalty of 10% of the unpaid tax. After twelve months, there's another 10%. If the return is late three times in a row, each of the £200 penalties rises to £1,000.
The six-month estimate is called a tax determination. You can't appeal it. You must file the return and pay, and HMRC will then recalculate the figures. A company that ignores the problem can therefore end up with a bill that bears no relation to its real profit.
Companies House and the annual accounts. For a private company, a penalty is charged automatically if the accounts are late. It's £150 if they're up to one month late, £375 if between one and three months late, £750 if between three and six months late and £1,500 if more than six months late. If the accounts are late two years in a row, the penalty doubles.
The two sets of penalties are separate. A company that is late with both can pay both.
Late payment of Corporation Tax works differently. HMRC charges interest on the unpaid tax from the day after the due date until it's paid. As at 9 January 2026, the rate was 7.75%, and it moves with the Bank of England base rate, so please check the current figure. Late payment of Corporation Tax normally attracts interest rather than a separate flat penalty, but the 10% penalties above do apply to unpaid tax when a return is six or twelve months late.
To see how it adds up, take a company with a Corporation Tax bill of £15,780.50. If it pays 60 days late, the interest at 7.75% is about £201. At 90 days, it's about £302. That's not ruinous, but it's money spent on nothing, and HMRC has further powers if payment doesn't follow. Those include collection action, and in serious cases a petition to wind up the company.
It's also worth knowing that HMRC pays interest on overpayments, at a lower rate. At the same date, the rate on a standard Corporation Tax repayment was 2.75%. The gap between the two is a good reason to pay accurately, rather than guess high or low.
You can appeal a penalty if you have a reasonable excuse, such as a serious illness, a death in the family or a failure of HMRC's own systems. A busy period or an oversight isn't normally enough. You must usually file the return first and then appeal. Keep evidence of what happened and when.
The penalties fall on the company, not the director. But directors who persistently fail to file accounts at Companies House can be prosecuted and fined, and a company that ignores its filing obligations may be struck off the register. Striking off isn't a mere formality. It can affect contracts, bank accounts and any assets held by the company. A late filing record also doesn't help when you apply for credit.
Most missed deadlines come down to forgetting a date. These are the habits I recommend.
Quick answer: For a 12-month accounting period, annual accounts are due at Companies House nine months after the year-end, Corporation Tax is due nine months and one day after it, and the Company Tax Return is due twelve months after it. A late return costs £200 immediately and a further £200 after three months. Late tax attracts interest.
What this means for a company director: The payment date comes first, and it's the one with the greatest financial effect, because interest runs from the day after. The return and accounts need complete records, so the work has to start well before their deadlines. Responsibility rests with you as a director, even if an accountant does the filing.
Example: A company has a 31 March 2027 year-end and a Corporation Tax bill of £15,780.50. Its accounts are due at Companies House on 31 December 2027, the tax on 1 January 2028 and the return on 31 March 2028. If the tax is paid 60 days late, the interest at 7.75% is about £201. If the return is filed four months late, the penalties are £400.
Common mistakes: Treating the return deadline as the payment deadline; forgetting that a first period of accounts longer than twelve months is split for tax; assuming that Companies House and HMRC filings are the same thing; ignoring notices for dormant companies; paying on the final day by a slow method; and failing to put the dates in a diary.
When should you speak to an accountant? When you form a company, to set the dates. Before changing a year-end. When you start or stop trading. If you can't pay on time, before the deadline, not after. And if you've received a penalty notice or a letter from HMRC or Companies House that you don't understand.
Deadlines are the simplest part of Corporation Tax, and the part that causes the most avoidable trouble. At Peter Hodgson & Co, we keep track of the dates for the limited companies we look after across Tunbridge Wells, Tonbridge, Sevenoaks and the wider Kent and South East area, and we remind our clients well before each one.
If you'd like help with your Corporation Tax dates, or you've missed a deadline and want to put things right, we'd be glad to hear from you. You can complete the "Contact Us" form on our website, call us on 01892 515 733, or send us an email at info@peterhodgson.co.uk.
Disclaimer:
The content of this blog is for general informational purposes only and should not be considered professional tax advice. The information is correct at the time of publishing but may change following future UK budget announcements or updates to HMRC guidance. Individual circumstances vary, and tax obligations can differ based on your personal situation. We strongly recommend consulting with us or a qualified tax professional to receive advice tailored to your specific needs.
Similar Articles
Newsletter
.svg)
.svg)
