How screwed am I? Self-Employed

LemonyS

I set up my business in Feb 2009. Since then, I haven't registered my business with HMRC, but I've submitted my company info yearly to Companies House. My revenue for 09-10, 10-11, was around £4k a year, profit about £1k a year. I've never drawn a salary but I've made minor personal payments from my business bank account.

I am meeting with an accountant next week, while I get my limited invoices and bank statements sorted. I have the money to pay him to sort out my finances so I can start trying to grow my business. (I have been in university for the past 3 years).

So I'm posting just to find out if it's really as bad as I think it is. I am expecting a fine from HMRC for submitting so late, and maybe some other fines for paying the tax late. I want to get this sorted but I'm pretty scared.

Thanks.

Savvy_Sue

Unless you've had other income as well, I don't think there's any personal tax due. Not if things are as you've presented them, but IANAA so I'd wait for one of them to come along.

LemonyS

Savvy_Sue wrote: »

Unless you've had other income as well, I don't think there's any personal tax due. Not if things are as you've presented them, but IANAA so I'd wait for one of them to come along.

That's correct, no other income.

I may not owe income tax, but I'm pretty sure I owe corporate tax. 2 years corp tax + fine + hopefully my accountant can make my personal drawings from biz bank county as personal income (which would be so low I wouldn't pay income tax).

But yeah, my worry is the corporate tax side of things.

Mouse1812

Assuming that your year end is Feb (you set up Feb 2009) and that your first year end was Feb 2010 your first corporation tax return should have been submitted by Feb 2011. Click, first £100 fine. Three months later, click another £100 fine.

On the figures given, a “cute” accountant might be able to zero the tax, but having filed the accounts you have limited the options available. Hint, losses and carry back should be questions to ask about. If accountant looks blank, find another one, quick.

Just make sure year two is filed on time (Feb 2012) to avoid any more fines.

LemonyS

Thanks for the reply, Mouse1812!

Regarding the fines -- Is that every 3 months, or just the first 6 months (2 fines)?

Also, HMRC don't know I exist, I am meant to send them a document saying I am eligible for tax, however I haven't done that. If my accountant files and, and pays 3 years tax instantly, will they charge me more?

I will ask about the losses thing too, thanks.

Mouse1812 wrote: »

Assuming that your year end is Feb (you set up Feb 2009) and that your first year end was Feb 2010 your first corporation tax return should have been submitted by Feb 2011. Click, first £100 fine. Three months later, click another £100 fine.

On the figures given, a “cute” accountant might be able to zero the tax, but having filed the accounts you have limited the options available. Hint, losses and carry back should be questions to ask about. If accountant looks blank, find another one, quick.

Just make sure year two is filed on time (Feb 2012) to avoid any more fines.

Mouse1812

Just two fines, and possibly a percentage of the tax - so not too serious yet. You owe two years of tax, not three, 2009/10 and 2010/11 and interest on the amounts overdue.

Corporation tax is due 9 months after year end
Corporation tax return is due 12 months after year end

Daft I know, but they be the rules.

antonic

http://www.hmrc.gov.uk/ct/getting-started/new-company/start-up.htm

LemonyS

Mouse1812 wrote: »

Just two fines, and possibly a percentage of the tax - so not too serious yet. You owe two years of tax, not three, 2009/10 and 2010/11 and interest on the amounts overdue.

Corporation tax is due 9 months after year end
Corporation tax return is due 12 months after year end

Daft I know, but they be the rules.

Thanks for the reply.

Yes, 2 years, but at the end of February it will be 3 so I counted that

2 fines and % of tax due I can live with, but I've read online that not submitting my form saying my company is eligible for taxation carries big fines. Like, £300 a day

EDIT// This form is called a CT41G.