HMRC is mandated to settle R&D tax credit claims within 28 days wherever possible. However, the majority of claims are presently taking around 12 to 13 weeks to be settled. With these current delays in mind, it is important that companies file R&D tax claims as early as possible to avoid missing out. In this blog, the tax and R&D tax experts at Luvo Financial highlight some of the key R&D tax deadlines to be aware of when submitting a claim.
The deadline for statutory accounts to be filed and for Corporation Tax to be paid is nine months and one day after the end of the accounting period. Any company that does not meet the deadline for filing statutory accounts can receive penalties ranging from £150 to £1,500 depending on when the filing is eventually made. While there are no penalties per se for late payment of Corporation Tax, it’s worth noting that interest is charged on tax due.
CT600 Company Tax Return filing deadline is 12 months after the end of the accounting period that it covers. Penalties for late filing range from £100 to 10 percent of unpaid tax, dependent upon when filing is eventually made.
Accounting period ends
The most popular accounting period end (APE) is the 31st March, often referred to as the ‘fiscal year’. Companies using the fiscal year must file accounts and pay Corporation Tax by the following 1st January. They must also file CT600 Tax Returns no later than 31st March of the following year.
The second most popular APE is 31st December, known as the ‘calendar year’. If a company uses this APE, they must file their accounts and pay any Corporation Tax by the following 1st October. For this APE, CT600 Tax Returns must be filed by no later than 31st December of the following year.
R&D tax deadlines
R&D Tax Credit claims can be made up to two years after the end of an accounting period. For instance, companies using the ‘calendar year’ can currently claim for APE’s of 30th December 2017 and 31st December 2018. However, they will not be able to claim for the earliest of these years after 31st December 2019, as it will be over the two year R&D tax deadline.
As a consequence of the current significantly extended HMRC settlement periods, it makes even more sense to ensure R&D tax credit claims are pulled together and reflected in the first submission of the relevant returns and initial tax payments (rather than reclaiming subsequently). Being prepared as early as possible is the best way to avoid inadvertently missing any R&D tax deadlines.
Companies with APE’s of 30th November 2018 and 31st December 2018 must act quickly to ensure they obtain the maximum benefit from claiming R&D Tax Credits. It’s currently not too late to progress claims for these APE’s, but it soon will be – so act now.
Get in touch
Luvo Financial is an independent firm, specialising in R&D tax credits. Based near Wolverhampton, we work with businesses and independent accountancy practices across the Midlands and elsewhere in the UK.