A Quick Checklist for Year-end Accounting While Dealing with Limited Company

Checklist For Year-End Accounting - Limited Company

September 16, 2020

That time of the year might be just a few months away but it always does come eventually, yes, you got it right; the year-end accounting date! The ‘year-end’ of a company is the date that the accounting period of that particular company ends. The significance of this date centres around the fact that this is when the limited company needs to ensure that it sends a certain list of documents to the HMRC as well as to Companies House.

However, in response to the financial and economic disruption and disarray caused by COVID 19, the HMRC have had to actively think on their feet. For instance, one such example is the announcement that was made on 27th June. This was about the fact that companies would be granted an ‘extension’ on the deadline to file their statutory accounts. This was as you can very well understand a welcome and much-needed respite and relief. There is a fine line that exists here as well which further illustrates how accounting for a limited company can sometimes turn tricky. This deadline has only been extended for those companies whose year-end falls or includes the dates ranging from the 27th of June 2020 to the 5th of April 2021.

It is no wonder that firms prefer to outsource accounting as it equates to one less burden to deal with. But whether you choose to outsource or not, it is always good to stay in the ‘know’, hence, here’s a quick checklist for year-end accounting while dealing with a limited company.

  1. Don’t miss that date!
    The year-end accounting date might have received an extension as illustrated above. However, now that you have time to file anywhere between the 27th of June 2020 to the 5th of April 2021 doesn’t mean you can omit to file altogether. The HMRC may be flexible due to COVID 19 but there are limits to this flexibility.
  2. Keep that timing…
    It is a recommended practice when accounting for a limited company to ensure that you keep filing your accounts with Companies House within the nine months of your company’s actual accounting period’s end date.
  3. Remember, there’s been no extension to Corporation Tax!
    This point is an important one to remember as it is easy to become confused. As of now, there has been no announcement from the government regarding an extension of the deadline about the payment of a company’s yearly Corporation Tax payment. This date still stands to be nine months and a day post the company’s year-end accounting date.
  4. The importance of knowing your accounts!
    Another positive to outsource accounting is the fact that you get to know the state of your accounts. This helps in letting you know about your liabilities like the amount of tax that you owe to the HMRC
  5. A note of caution:
    The extension to this filing deadline would not be applicable when it falls on 6th April 2021 or post that.

The above are just a few points that you should keep in mind. However, for a more comprehensive view, it would be better to ask the experts. Also, since the pandemic is in no way appearing to fizzle out there might be more changes or adaptions made by the HMRC. Looking at all these points it seems wise indeed to keep abreast with the latest updates as change is in the air and indeed, change seems to be there to stay all that can be done is to stay prepared and updated.