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Tax Computations

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Tax computations are statements that show annual tax adjustments to the accounting profit of companies that require supplementary evidence for their tax matters.

Examples of tax adjustments are: non-taxable receipts, non-deductible expenses, capital allowances or additional deductions.

Usually, these types of computations are of tax payable with those requiring more intricate tax affairs. As a result, they are typically handled by the taxpayer or their chosen specialist accountant, like Norden’s.

Once completed, the tax computations are then usually submitted to the appropriate tax authority as supplemental material, which supports a uniform summary tax return, such as a UK Corporation Tax return.

What are Tax Computations?

For a company which yields external accounts, tax computations will generally consist of:

• Calculate taxable profits via summary adjustments of the accounting profits (externally reported).

• Extra detail and resolutions of figures that appear within the accounts.

Frequently Asked Questions

How do I complete a Company Tax Return?

Companies must have their Corporation Tax Returns filed online through HMRC. Alongside the CT600, the documents that need to be submitted are the Corporation Tax calculations, computations and the accounts.

To begin filing online, businesses should register with HMRC and get their user ID and password. It may be a good idea for you to request your accountant’s services to handle this matter for you, on your behalf.

In addition, accounts should be filed with Companies House online or through the post (online submissions are not yet compulsory). To make an online submission, businesses will need an authentication code from Companies House. It’s important to note that this is an entirely different one to that from HMRC. However there is the option of filing jointly through the HMRC website.

How do I complete a Company Tax Return?

Companies must have their Corporation Tax Returns filed online through HMRC. Alongside the CT600, the documents that need to be submitted are the Corporation Tax calculations, computations and the accounts.

To begin filing online, businesses should register with HMRC and get their user ID and password. It may be a good idea for you to request your accountant’s services to handle this matter for you, on your behalf.

In addition, accounts should be filed with Companies House online or through the post (online submissions are not yet compulsory). To make an online submission, businesses will need an authentication code from Companies House. It’s important to note that this is an entirely different one to that from HMRC. However there is the option of filing jointly through the HMRC website.

What information and computations will I need to provide?

The following must be filed with HMRC:

• Your statutory accounts

The statutory accounts will usually comprise:

• Profit and loss accounts

• The director’s report

• Notes

• A balance sheet as a statement of your financial standing

• Corporation Tax computations

Taxable profits and profits per the accounts regularly produce imbalanced figures. For example, there are figures within the profits for accounts purposes, which you won’t find inside the profits for Corporation Tax purposes.

Corporation Tax computations are an accurate way of calculating the adjusted profits for Corporation Tax purposes. However, the procedures for this are complex, and it’s advised that an expert accountant like Nordens manage and complete this on your behalf.

• Company Tax return

The primary details found within the return are:

• Specific company details

• Calculations based upon due corporation tax

• Capital allowances claim details

• Particulars of any losses claimed

Can I use an online filing service myself?

If you are confident, experienced and have the time for preparing and filing your own Company Tax Return, then this is definitely an option. Nonetheless, if you feel any reluctance about doing this job yourself, then it’s worthwhile employing the services of a dedicated accountant.

Firstly, check that you have access to utilise the HMRC Corporation Tax filing service online. Here, you can securely submit your Company Tax Return with HMRC, plus your accounts via Companies House.

If your business is unrepresented and has standard tax affairs, you will be able to use the free HMRC online service for:

• Filing your accounts to Companies House

• Sending your company tax return to HMRC

• Simultaneously sending HMRC your company tax return and Companies House your accounts

• Sending HMRC your accounts and computations (formatted correctly in iXBRL)

When does my Company Tax Return need to be completed?

You’ll find that there are a variety of deadlines regarding the filing of returns and payments of tax:

Your company tax returns, along with its potential computations will need to be filed to HMRC inside 12 months, once the relevant accounting period has ended.

Any owed corporation tax should be paid no more than 9 months and a day after the conclusion of the accounting period. This can be done electronically.

For example:

If your business has a financial year end of 31st December 2019, they will need to pay any due corporation tax by 1st October 2020, as well as filing the return by 31 December 2020. Normally however, these items are filed together.

Keep in mind that if a company tax return is late in getting filed, then it is likely to face fines.

When should I file my statutory accounts?

Your initial statutory accounts will need to be submitted within 21 months after you have registered with Companies House.

From that moment forward, you must file your accounts 9 months after your company’s accounting year.

Should you make a filing after the deadline has passed, you could receive a fine up to £1,500. This depends on the length of time that your payment was delayed for.

If you are running a small business, you won’t need to file a full set of accounts to Companies House. You can opt to submit a shorter, summarised version, which condenses the key ideas and usually doesn’t include the profit and loss accounts. The extended version however, will need to be sent off to HMRC and any shareholders, as well as your company’s tax return.

If my Company Tax Return is wrong, what can I do?

Any alterations can typically be completed inside 12 months of the tax return’s filing date. However, HMRC may still enforce financial penalties for any mistakes made.

HMRC can conduct compliance checks to approve the figures that have been submitted are accurate.

Beyond Accountancy

At Nordens we're more than just accountants, we're business experts who can help you achieve the biggest goals.

Our specialist strategic division at Norden’s boasts some of the leading entrepreneurial business minds in the country. They cater towards delivering consistent success stories for businesses looking to achieve all their goals and more.

Through highly tailored guidance, coaching and advice, Norden’s Strategic are able to define exactly how your business can attain new levels of success.

Regardless of how you define ‘success’ for your business, our strategic service is guaranteed to bring about real and lasting change. By partnering with some of the UK’s top business coaches, we steer you along the path to greater future.

Every business, no matter how big or small, needs to make the right decisions. How to best manage your accounts can put huge question marks over your business. Accounting 2 You are here to take that away and provide all the answers you need.

Our bookkeeping branch offers a fully inclusive, comprehensive service that they can trust. Since 2005, our specialist bookkeepers have been successfully managing the accounting of individuals and small businesses.

With experts in payroll analysis, credit control and financial recording, Accounting 2 You will lead your business efficiently and with a real purpose to help you grow and prosper.

Voted as EXCELLENT - 9.9 out of 10 based on 164 reviews

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Chris Dyer

Director - Metro Bank

Nordens are always very easy to deal with and extremely professional and efficient. I would have no hesitation in recommending them to my clients for their accountancy needs, no matter how complex they may be.

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Co-Founder - Chicmi Limited

Very good to work with - the team go above and beyond to make the accounts easy and efficient. They're all super friendly and a joy to work with.

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Director - Rose Opticians

I have been using Norden Chartered Accountants for 5 years and very happy with the service provided. All members of the team are very knowledgeable and have a wealth of experience which has proved very beneficial to my organisation

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Founder & Director - Physio LDN

Very easy to contact and put me in touch with the right person whenever I need to ask any questions. Extremely knowledgeable and can help me manage my various businesses whenever I need.

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Principal - Pauline Quirke Academy

Great accountants, always available to offer advice. The team have transformed my business.

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Founder - Dataphone

Having worked with Nordens over the last 5 years, not only to look after my annual accounts but they have also provided outstanding professional advice. They have guided me through a Company share buyback with clear and objective advice. We have also been using Nordens strategic services for a couple of years, which has helped bring about significant improvements that exceeded my expectations. With experience of working with several local accountants over my 29 years in business, I’m very pleased with the service I have received from Nordens.

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Director - Linekers

Trusted our business with Nordens for over 10 years now and watched the company grow into the successful innovative business it has become today. Deservedly so. Every aspect of financial advice we need is always given promptly and with a smile. We have total confidence in all aspects of advice Nordens give. If you are looking for accountants, its a no brainer!

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Founder - Foundation Sports Limited

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Managing Director - Prime Time Boilers

I have been with Nordens for many years now and they are a great accountants.

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Founder - Vivid Finishes

We have used Nordens for the last 5 years and have had a great service throughout. The guys are very passionate about what they do and have played a part in the growth of our company, highly recommended.

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Managing Director - AMD Interior Architecture

Great Service at Nordens from a friendly very approachable team Particularly Kirsty Willis and Joe Sword who have been helping us since we started the business in 2016.

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  Why I Founded Nordens

In November 2002, having sold our other business interests off earlier in the year, I decided to set up Nordens Chartered Accountants. The easy part was knowing how to do it, as I had established and built a smaller practice a few years earlier, the difficult part was not following the traditional accountancy path. Having run businesses, both successfully and unsuccessfully, I wanted to help business owners resolve their short term problems and work with them to achieve their longer term goals. Business has always been my interest and I love that I can help business owners achieve what seems like the impossible every single working day.

Mark Norden
Founder

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