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taxadvisor.uk
taxadvisor.uk, Chartered Certified Accountant
Category: UK Tax
Satisfied Customers: 4145
Experience:  FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
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How to complete a CT600 end of the year?

Resolved Question:

Completing a CT600 year ending in January 31st, 2012. I'm unsure which boxes to include which figures in and need help with this. I do my own PAYE and VAT and everything else, so I have such a simple case. I don't want to fork out loads accountant to fill it in . Any pointers or guidance would be appreciated.

My LTD company is small (just me and my wife). My accounts/ records/balance sheet is just a few pages of simple entries:

Monthly Fees into the company clients.
Monthly PAYE and tax out of the company to myself (my wife's didn't take a salary until April 2012).
Ad-hoc Accom/living expenses out of the company (I do training courses across the UK and claim out of pocket living expenses).
Ad-hoc Accom/living expenses into the company (the above expenses claims are passed to my clients).
Monthly expenses out of the company (phone, postage, use of home as office and small accounts of mileage).
Monthly Bank interest (un-taxed).
4 Dividends
Company has no assets (I use personal laptop and PC).
Company has a single £1 share as the sole executive director (is this the right term?).

When I finally get past the Capital and reserves figures, I have to agree with the 3 statements, but don't know what they mean:

1. year ending in January 31st, 2012 the company was entitled to exemption under Section 477 of the Companies Act 2006 relating to small companies. 
2. The members have not required the company to obtain an audit in accordance with Section 476 of the Companies Act 2006.
3. The directors acknowledge their responsibilities with the requirements of the Act with respect to accounting records and the preparation of accounts.

I don't know what FRSSE is, so should I tick either:

1. "These accounts have been prepared in accordance with the provisions applicable to companies subject to small companies regime and in accordance with the Financial Reporting Standard Entities (effective 2008)." or 
2. "These accounts have been prepared in accordance with the provisions applicable to companies subject to the small companies regime." 

Submitted: 2 years ago.
Category: UK Tax
Expert:  taxadvisor.uk replied 2 years ago.

If you have any questions or need further clarification after reading my answer please let me know.

I am happy to help you complete CT 600. I filed a couple of them yesterday.

Small companies are allowed to file abbreviated accounts with the Companies House and are normally exempt from audit requirements. These exemptions are covered under sec 477 and 476.

When I file accounts clients who are small companies, I put X 1-3 and then accounts produced in accordance with FRSSE (effective 2008). This is financial reporting standard covering small companies.

The statements you are required to acknowledge are standard statements applicable to small companies in the main.

Customer: replied 2 years ago.

This was helpful information about the tick boxes, but the main part of my question is that I'm unsure which boxes to include which figures in and need help with this. I have completed books and invoice records etc. The original question lists the 7 types of numbers I have on my monthly accounts. I need help with which box (AC12-70) to include which figures in:

So far: I have included my monthly invoices and incoming expenses in box AC12 - turnover: £44,491.

My salary and outgoing expenses in box AC14 - cost of sales: £13,086.

My monthly expenses (phone, postage, home office costs) in AC20 - administrative expenses: £3,559.
My bank interest in AC28 - interest: £12.

This generated an AC36, profit of £27,858

I put my dividends in box AC38 (£11,313) and got net balance of £16,545 in AC40.

I've left AC42-50 at zero I put £7,323 in AC52 for debtors - these were 2 invoices that hadn't been paid by the 31/1/12, but had been included in the AC12-36 boxes.

Bank balance was £11,438 on the 31st Jan 2012, so that went in box AC54.

This gives me a net asset of £18,761.

Does the above look like I've filled in the correct numbers in the right boxes?
What should I put in AC70 (£1?), AC76 and AC74?

Given my limited knowledge, am I likely to encounter further confusion in the 3 subsequent sections of the CT600 form - accounts notes, directors report, accounts review?

Expert:  taxadvisor.uk replied 2 years ago.

Is this your first set of accounts that you are filing?

Customer: replied 2 years ago.
Yes. My company started on 7th Jan 2011. Period 7/1/11 to 31/1/12 is my first set of accounts.
Expert:  taxadvisor.uk replied 2 years ago.

Did you actually start to trade on 7 Jan 2011 was that the date company was formed?

If you started to trade on 1 Feb 2011 then you will have to file just one set of CT600 return otherwise two ... one covering the period 7 Jan 2011 to 6 Jan 2012 and the second covering 7 Jan 2012 to 31 Jan 2012.

You will have to have two sets of accounts to cover the period longer than 12 months.

You have not mentioned about creditors. Were there any? Did you pay expenditure that had not been reimbursed to you at year end date?

There is an apparent difference on your balance sheet of £2,515 see below.

Description

this year

this year

of account

box

amount

PROFIT AND LOSS

TURNOVER

AC12

44,491

COST OF SALES

AC14

13,086

GROSS PROFIT

AC16

31,405

DISTRIBUTION COSTS

AC18

0

ADMINISTRATIVE EXPENSES

AC20

3,559

OTHER OPERATION INCOME

AC22

0

OPERATING PROFIT OR (LOSS)

AC26

27,846

INTEREST RECEIVABLE

AC28

12

INTEREST PAYABLE

AC30

0

PROFIT OR (LOSS) BEFORE TAX

AC32

27,858

TAX

AC34

0

PROFIT OR (LOSS) YEAR

AC36

27,858

DIVIDENDS PERIOD

AC38

11,313

TRANSFERRED TO RESERVES

AC40

16,545

 

Description

this year

this year

of account

box

amount

BALANCE SHEET

INTANGIBLE ASSETS

AC42

0

TANGIBLE ASSETS

AC44

0

TOTAL FIXED ASSETS

AC48

0

STOCKS

AC50

0

DEBTORS

AC52

7,323

CASH AT BANK AND IN HAND

AC54

11,438

TOTAL CURRENT ASSETS

AC56

18,761

CREDITORS DUE WITHIN ONE YEAR

AC58

0

NET CURRENT ASSETS

AC60

18,761

TOTAL ASSETS LESS CURRENT LIABILITIES

AC62

18,761

CREDITORS DUE AFTER MORE THAN ONE YEAR

AC64

0

PROVISION

AC66

0

TOTAL NET ASSETS

AC68

18,761

CAPITAL AND RESERVES

CALLED UP SHARE CAPITAL

AC70

1

REVALUATION RESERVE

AC76

0

PROFIT AND LOSS ACCCOUNT

AC74

16,545

TOTAL SHAREHOLDERS FUNDS

AC80

16,546

Difference

xxxx

2,215

You should move salaries from cost of sales to admin costs

Customer: replied 2 years ago.

The period confused me too. The company was formed on 7/1/11. It is recorded as dormant days until 9/1/11 (I started working then). According to the HMRC website I have to submit 2 CT600s: One /1/11 to 10/1/12, then another small one from 11/1/12 to 31/1/12.

However, the CT600 that I have downloaded from them to complete has the whole period in 1 form: Box AC3 is 7/1/11 and box AC4 is 31/1/12. I simply assumed they had made the sensible decision to include the extra 2 weeks in Jan 2012 in my first return. Is this something to do with it being a joint filing with companies’ house perhaps?

I also can't explain the discrepancy between the numbers. My records are complete and really quite straight forward (just a few pages of excel!).

Expert:  taxadvisor.uk replied 2 years ago.

You have two choices.

File the accounts by downloading the abbreviated accounts PDF file from Companies House. The first set of accounts to be filed at Companies House cover the period to 31 Jan 2012 (your accounting reference date) . As you file the Balance Sheet only you won't have to produce accounts separate periods. It is a snap shot of balance at a given date.

File the accounts with Companies House using HMRC software. As your first accounting period covers more than 12 months, you will have to file two CT600 returns.

You stated you started working on 9 Jan 2011. When did you generate your first sales invoice? I have in the past called the tax office and agreed with them that we treat start of business on 1st of the month following month of incorporation and alleviate apportionment of profits into days in the accounting period ie 365/388days and 23/388days.

Otherwise you will have to file two sets of CT600.

Now coming to the difference, does your spreadsheet balance?

I am surprised you are not showing any creditors?

If all other numbers are correct, then the difference is most likely to be creditors.

Were there any PAYE deductions on your salary? If so, what was owed to HMRC at 31 Jan 2012?

If you are able to send figures from your spreadsheet, I will happily check .

Customer: replied 2 years ago.

I think I'll therefore have to file two returns as my first (expenses) invoice is before the end of my initial month of trading. As I'll have to do 2 CT600 returns, do these still get copied to companies house, or do I have to submit a separate balance sheet to them of the periods?

The big problem I have now is that the CT600 form is wrong right at the start. In the header information PDF form it states that I'm returning /1/11 - 9/1/12, but on the main 'about the company' page the 'period of accounts' is set at 7/1/11 - 31/1/12 (box AC3 and AC4). I can't change these boxes! What should I do about that?

I've realized that the difference in my balance sheet could be down to VAT - all the figures in the CT600 are net of VAT, but of course my bank balance includes some VAT. I presume I therefore include HMRC as a creditor and enter the VAT due at the end of my accounting period as a creditor amount?

Expert:  taxadvisor.uk replied 2 years ago.

I know there appears to be inconsistency in the dates reported.

This is what I would do if I were preparing these accounts.

File an abbreviated balance sheet at Companies House using their template and cover the period to Jan 2012.Iit is not a big exercise; tick the box that says its first set of accounts to be filed.

Download a fresh CT600 PDF file from HMRC website and start afresh.

I will be happy to continue helping you if need be.

What is important is that you report correct financial numbers and pay CT on those profits.

Put your difference as creditors and this will make total net assets equal shareholders funds. I think your creditors are not properly reflected.

Customer: replied 2 years ago.

Thanks advice; I will file an abbreviated balance sheet at Companies House 7/1/11 to 31/1/12. Their form is nice and simple! I will then do a CT600 /1/11 to 9/1/12, then another /1/12 to 31/1/12. I can complete these without joint submitting to companies’ house, so the dates will be entered manually and will be correct!

I will probably just need a little guidance in getting the numbers in the right boxes on my 2 CT600 forms. Is it OK to leave this support question open few days while I complete the CT600 forms. I won't get a chance to do the forms until this evening, as I'm working client today. Is it therefore OK with you if I post a reply question this evening with the numbers when I have details ready?

Oh, one thing I did spot on the CT600 form is after the main 'numbers' part of the CT600, it goes on to 'Statutory Accounts Notes' and it has a few boxes with 'X's already. It appears to want me to provide textual information at this stage? What information are they looking for, as 'Accounting policies' 'called up share capital', and 'profit and loss account' are all ticked?

Expert:  taxadvisor.uk replied 2 years ago.

I am glad you have opted to file abbreviated accounts separately.

The boxes in the statutory accounts notes, you don't have to put anything.

Customer: replied 2 years ago.

My original question asked with which boxes to fill in on my CT600. My assumptions were all correct, except - it should be included in admin, rather than sales costs.

to the point on the 'statutory accounts notes' section, do I just remove the 'X' marks that it has auto-checked ? Should I leave one X in place and tell them that HMRC (VAT AND income tax) are creditors, or just leave creditors as a simple number on the form?

I think I will be ok completing these CT600 forms now, I was just hoping you could hang on and hand-hold me through the numbers! I'm happy to close this question when you reply to the 'X' point above.

Thanks the advice - you've made the process much clearer and steered me through a job which is confusing beginner!

Expert:  taxadvisor.uk replied 2 years ago.

Thank you response.

You don't remove the "X" marks but on the next page leave blanks.

You don't have to provide details of your creditors when completing CT600 return., just show them as creditors due within one year as one figure.

OK I'm doing the CT600 10/1/11 to 9/1/12 first. I have 3 invoices (2 money fees and 1 outgoing amount expenses). In the profit and loss boxes AC12, AC14 etc, should I include invoices that have been issued, but not yet paid, or do I not add these numbers in here? I have included the value of those invoices in my debtor’s box on the balance sheet page?

I will answer any questions you have when completing the CT600 return; just send me a reply.

Expert:  taxadvisor.uk replied 2 years ago.

I suggest you reproduce the accounts on a spreadsheet with three columns to cover

Year to 09/01/12, period to 31/01/12 and TOTAL (this total should agree with the numbers we reviewed earlier).

In your P&L account you should include all invoices raised income whether paid or not in the accounting period.

Once you are happy with the split, share it with me and finally input them into CT600.

Balance sheet at 09/01/12 should be relatively easy get correct bank balance and invoices outstanding (debtor’s include VAT).

The profit and loss balance and share capital should be straight forward we will put balancing figure in creditors.

Expert:  taxadvisor.uk replied 2 years ago.

I calculated your CT on apportionment basis as 365/388 and 23/388 and the total tax on a profit of £16.545 is £3343.54

On the other hand, if i say all profits were earned in the period to 9 January 2012 and no activity 10/01/2012 to 31/01/2012 the tax is £3,345.72.

You could show all P&L items in 1st CT600 return and show actual bank balances, debtors at 09/01/2012 and 31/01/2012.

Customer: replied 2 years ago.

Can I go back to basics minute? I have a list of all transactions in excel that cover all incomings and outgoings company from start to present. Every entry ties to a bank account transaction. Against every transaction I have the invoice/transaction date and the banking date, transaction type, the VAT in/out and the NET in/out and they are all listed in transaction date order.

Period 09/1/11 to 10/1/12 has 106 entries, which summarize as:

Client Expenses (In) £5,764

Client Fees (In) £31,000

Employee Salary (Out) £5,578

Employee Expenses Client Work (Out) £5,889

Employee Expenses ITGT Expenses (Out) £3,364

Bank Interest (In) £10
Dividend (Out) £11,313

VAT Payment (Out) £0
TAX / NI Payment (Out) £47

Other info:

The Bank balance at 9/1/12: £7,651

Unpaid VAT in bank balance £1,203

Invoices (net) not paid (2 of) £4,129

Unpaid VAT invoices £826

I am trying to convert these figures into the appropriate boxes on the CT600 (this was my initial reason ). I have come up with:

Box AC12 - Turnover. (fees + expenses): £36,764

Box AC14 - Cost Of Sales. (Employee expenses): £5,889

AC16 calculates as £30,875

Box AC20 - Administrative Expenses (salary + company expenses): £8,989

AC26 calculates as £21,886

Box AC28 - Interest Received: £10

AC36 calculates as £21,896

Box AC38 - Dividends: £11,313

AC40 calculates as £10,583

Net Invoiced amounts unpaid at 9/1/12: £4,129 (AC52)

Bank balance at 9/1/12: £7,651 (AC54)

AC56 calculates as £11,780

Unpaid VAT on paid invoices, at 9/1/12: £1,203 (AC58)

AC68 calculates as £10,577

I've got £1 in AC70, then £10,576 in AC74, but I don't know what these numbers are - I have to do this to make the number in AC80 match that calculated . Not sure why?

After the statutory accounts notes pages in the CT600, there is another profit and loss page which pre-populates as follows:

AC184 = 0

AC185 = £21,896

AC186 = £11,313

AC187 = £10,583 (which matches AC40)

I press next and CT600 says that the "retained profit must tally with the value in the balance sheet" and won't let me continue.

Expert:  taxadvisor.uk replied 2 years ago.

I have input the numbers in the model there is a difference and I have adjusted the creditor by this amount to make the balance sheet agree

You say box AC 52 is net invoiced amounts unpaid figures should be inclusive of VAT (the debtor is invoice total including VAT) If this amount is greater than £4,129 then adjust the creditor with the difference.

Adjusted numbers are

Description

this year

this year

of account

box

amount

PROFIT AND LOSS

TURNOVER

AC12

36,764

COST OF SALES

AC14

5,889

GROSS PROFIT

AC16

30,875

DISTRIBUTION COSTS

AC18

0

ADMINISTRATIVE EXPENSES

AC20

8,989

OTHER OPERATION INCOME

AC22

0

OPERATING PROFIT OR (LOSS)

AC26

21,886

INTEREST RECEIVABLE

AC28

10

INTEREST PAYABLE

AC30

0

PROFIT OR (LOSS) BEFORE TAX

AC32

21,896

TAX

AC34

0

PROFIT OR (LOSS) YEAR

AC36

21,896

DIVIDENDS PERIOD

AC38

11,313

TRANSFERRED TO RESERVES

AC40

10,583

 

Description

this year

this year

of account

box

amount

BALANCE SHEET

INTANGIBLE ASSETS

AC42

0

TANGIBLE ASSETS

AC44

0

TOTAL FIXED ASSETS

AC48

0

STOCKS

AC50

0

DEBTORS

AC52

4,955

CASH AT BANK AND IN HAND

AC54

7,651

TOTAL CURRENT ASSETS

AC56

12,606

CREDITORS DUE WITHIN ONE YEAR

AC58

2,022

NET CURRENT ASSETS

AC60

10,584

TOTAL ASSETS LESS CURRENT LIABILITIES

AC62

10,584

CREDITORS DUE AFTER MORE THAN ONE YEAR

AC64

0

PROVISION

AC66

0

TOTAL NET ASSETS

AC68

10,584

CAPITAL AND RESERVES

CALLED UP SHARE CAPITAL

AC70

1

REVALUATION RESERVE

AC76

0

PROFIT AND LOSS ACCCOUNT

AC74

10,583

TOTAL SHAREHOLDERS FUNDS

AC80

10,584

 

Description

this year

this year

of account

box

amount

PROFIT AND LOSS

profit or (loss) year after tax

ac36

21,896

dividends period

ac39

11,313

net balances transferred to reserves

ac40

10,583

STATUTORY ACCOUNTS NOTES

profit and loss - opening balance

ac184

0

profit period

ac185

21,896

equity dividends paid

ac186

11,313

retained profit

ac187

10,583

Customer: replied 2 years ago.

The AC52 box is exactly the figure you calculated when I add in the VAT (makes sense as that number will arrive in my bank). If I then include that VAT in the creditors box (AC58), I get a figure just £1 out from what you have above. I'll put that down to rounding and go with the £2,022. Or, should I put £2,023 in AC58 and put zero in AC70? I'm still not sure why we put £1 in AC70! I know there is a single share worth £1 in my company, but its not in my books anywhere, so does not appear in any of my numbers.

I have about 8 transactions that will be included in the period 10/1/12 to 31/1/12, so that should be a little easier. Will the CT600 ask me year’s figures? If so, should I enter the above figures, or is my second CT600 still part of my first year's figures?

Expert:  taxadvisor.uk replied 2 years ago.

Lets address the issue of £1 have you issued any shares to yourself?

My suggestion, treat £1 as issued share capital and adjust creditors rounding difference. My figures had assumed issued share capital of £1.

Once you are happy with all the figures, these figures will become your year one figures when you complete CT600 second accounting period.

Customer: replied 2 years ago.

Can I ask please - where does the figure we enter in AC74 (profit and loss account) come from? It appears to be the 'total net assets' minus the 'called up share capital', but I don't see the point in doing this as the CT600 then adds them together again to arrive back at the 'total net assets' figure again.

Incidentally, should I enter £1 as the called up share capital CT600, or just this first one (it’s unlikely my shares will change)?

Expert:  taxadvisor.uk replied 2 years ago.

The figure in box AC74 comes from AC187.

As it is year one the figure in boxes AC40, AC74 and AC187 will be the same..

Unless you issue more shares to yourself at a future date your issued share capital will be £1 CT600 and return to Companies House.

taxadvisor.uk, Chartered Certified Accountant
Category: UK Tax
Satisfied Customers: 4145
Experience: FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
taxadvisor.uk and other UK Tax Specialists are ready to help you
Customer: replied 2 years ago.

Thanks your advice and help.

Expert:  taxadvisor.uk replied 2 years ago.

You are very welcome, and thank you JustAnswer.

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