Filing Accounts with the Companies House

Companies incorporated in the UK must file their financial statements with the Companies House. The accounts become due 9 months after the end of financial year (6 months for public companies); this being said, a company may choose the date of financial year end at its own discretion.

In case the company annual revenue is less than GBP 6.5 million, its balance does not exceed GBP 3.26 million and it had less than 50 employees, the company is exempt from auditing its accounts. Otherwise, the financial statements must be certified by local auditor.

As per the new regulations, the companies with their financial year expiring after the 01st day of October 2012 must have their accounts audited provided 2 of the said conditions are met, and the companies with their financial year expiring before the aforementioned date must have their accounts audited provided 1 condition is met, i.e. the old rules apply.

However, a company must file its report and tax declaration even in case it was dormant during the year.

Penalties are applicable to accounts falling overdue as listed below:

Overdue by:

Penalty (GBP)*

Private Companies and LLPs

Public Companies

0-1 month



1-3 months



3-6 months



Over 6 months



*If filing the accounts for the preceding financial year was delayed, the above amounts of penalties are doubled.

Filing Tax and Financial Reports with Tax Authorities

Apart from the above, a company must file with Her Majesty Revenue and Customs an Income Tax Declaration (СТ600) enclosing thereto a copy of its accounts. Income Tax Declaration becomes due after 12 months from the financial year end. However, in case a company received any taxable income during that year, the tax falls due after 9 months after the financial year end.

Penalties are applicable to tax reports falling overdue as listed below:

Overdue by:

Penalty (GBP)

0-3 months


over 3 months


In case a company fails to timely file its Income Tax Declaration during three years in a row and longer, the amounts of penalties levied are considerably increased:

Overdue by:

Penalty (GBP)

0-3 months


over 3 months


In addition to the above fixed penalties there are additional penalties depending on the amount of tax:

Overdue by:

Penalty (GBP)

5-12 months

10% of the amount of tax

over 12 months

20% of the amount of tax

Income Tax (Corporate Tax)

UK companies, apart from partnerships, must pay Corporate tax. Large companies (with expected profit of more than GBP 1.5 million) must make advance payments on quarterly basis during the current period. For any other companies the tax becomes due 9 months after the financial year end. Penalty fees are accrued in case of overdue payments.

Tax rate may be revised on annual basis; below are listed the tax rates for the financial periods starting as follows:

2013 (April 1, 2013 – March 31, 2014)

2014 (April 1, 2014 – March 31, 2015)

Profit of GBP 0 to 300, 000.00: 20%

profit of GBP 0 to 300, 000.00: 20%

Profit of GBP 300, 000.00 to 1.5 million: 20% to 23%

profir of GBP 300, 000.00 to 1.5 million: 20% to 21%

Profit exceeding GBP 1.5 million: 23%

profit exceeding GBP 1.5 million: 21%

Beginning the fiscal year of 2015 the UK companies shall be charged a uniform corporate tax in amount of 20%.

Withholding Tax

In case a UK company pays interests or royalties to foreign companies, it must deduct and pay a withholding tax amounting to 20% of the total amount of payable interest and royalties. The above rates may be reduced (even to zero) in case the above is provided by Double Taxation Treaties signed between the UK and the corresponding countries. Dividends are not subject to tax in any case.


In some cases when a company operates in the UK or other EU countries or in case it has business relations with companies incorporated in the EU countries it may, in certain circumstances, need to get registered as VAT payer and to obtain the corresponding tax number being different from the corporate tax payer ID number. Once registered as VAT payer, the company must file quarterly VAT Reports that become due 1 month after the end of the quarter and, in case VAT is applicable, the company must pay it. In case of moderate turnover a yearly reporting scheme may be applicable.

VAT rate varies subject to type of goods and services; the following tax rates are now applicable 0%, 5% and 17.5% (basic rate). During 2009 as an anti-crisis measure basic VAT rate was reduced to 15%. However, with effect from January 4, 2011 the basic VAT rate is increased to 20% (from the previously applicable 17.5%).

Reporting And Accounting of the UK LLP

Limited Liability Partnerships and the members thereof must register with HMRC even if the partnership is a tax exempt entity in the UK. All partners also have to file annual accounts and tax return to the Tax Authorities and annual returns to Companies House. If the members of the partnership are corporate bodies incorporated in BVI, Belize or Panama, the partnership files a zero balance accounting, however, the partnership must file it all the same.