Starting a limited company is exciting — but the accounting rules in the first year can catch new directors by surprise. One of the most common issues is that you may need to file 2 Corporation Tax returns in the first year. Here’s why it happens and what you need to do.
Why 2 Corporation Tax returns in the first year?
When your company is formed, Companies House sets your first accounting period to end on the last day of that month in the following year.
That often means your first set of accounts covers more than 12 months.
👉 HMRC, however, only allows corporation tax returns to cover a maximum of 12 months.
So if your first accounts run for, say, 14 months, you’ll need to:
- File one corporation tax return for the first 12 months.
- File a second corporation tax return for the remaining 2 months.
An example of 2 Corporation Tax returns in the first year
- Company incorporated: 10th June 2024
- First accounts will normally cover: 10th June 2024 – 30th June 2025 (12 months and 21 days inclusive)
What happens with the corporation tax returns?
- Return 1: 10th June 2024 – 9th June 2025 (12 months)
- Return 2: 10th June 2025 – 30th June 2025 (21 days)
Deadlines to Watch
- Accounts: Due at Companies House within 21 months of incorporation.
- Corporation tax payment: Due 9 months + 1 day after the end of each period.
- Corporation tax returns: Due 12 months after each accounting period ends.
Missing these dates = potential penalties and interest.
Why It Matters
- Two returns = double the admin.
- It’s easy to make mistakes if you’re new to corporation tax and company accounts.
- Incorrect or late filing can lead to HMRC penalties.
How an Accountant can help with 2 Corporation Tax returns in the first year
We can make sure your first-year filings are correct by:
- Splitting your corporation tax periods accurately.
- Preparing and submitting both returns.
- Ensuring deadlines are met to avoid penalties.
- Advising if changing your year end could simplify future returns.
Final Thoughts
Needing to file 2 corporation tax returns in the first year is completely normal — but it can feel confusing. With the right support, it’s simple to get right and avoid unnecessary stress.
📞 Contact me today if you’re setting up your first company and need guidance on corporation tax returns.
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Mistakes can be costly.
As can missing deadlines.
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