As Her Majesty’s Revenue and Customs (HMRC) are currently consulting over proposed changes to the way in which corporation taxes are declared, a number of organisations are expressing their concerns over the impacts these changes could realise. Whilst they recognise the fact that changes in this system would be welcome, the general consensus appears to be that the limitation of change to limited companies only, and not sole traders, would not be far reaching enough. More importantly, they believe that if the changes are introduced they may well lead to extra bureaucracy for the small business owner and additional IT costs.  

1^st Contact are available to assist you with any tax related issues that you may have. The company is keen to provide help and support to the smaller and local business owners who may well be finding it hard to deal with their company accounting at a time when there is a lot of concern and anxiety in relation to this current economic downturn. Our team of tax experts and accountants are on hand to ensure that your company is not falling foul of the strict procedures and legal requirements which are in place through the HMRC. 

At present, the majority of small business owners are already struggling to come to terms with the ‘accrual based’ accounting system which must be adopted for submitting corporation tax liabilities. In addition, there is a requirement to ensure that your company’s accounts are scrutinised by either an accountant or an official tax expert. Every company is required to submit their accounts to both the HMRC and Companies House and there are two different system in place for each.  

The HMRC are consulting over the possibility of making the accounts for corporation tax submission based on a new ‘near-cash’ method. This is likely to mean that new IT equipment and packages will be required to ensure that the accounts are in line with this new system and there are fears that this will pose extra financial burden on small business owners as well as extra red tape to negotiate past.  

When comparing the way in which submissions are declared to both organisations, Companies House seem to be recognised as offering the most user friendly methods. HMRC, on the other hand, quite stubbornly do not seem to be inclined to adopt this or any similar methods. Instead, they seem content to ‘go around the houses’ and not make life any easier for the already struggling small business owners.  

It will be interesting to see what materialises from these consultations. Here at 1^st Contact we will endeavour to keep you abreast of any revelations in this regard. In the meantime, do not struggle with trying to work in the dark and come to terms with your legal tax obligations alone, approach us today for efficient, cost-effective advice that will ensure your company’s full compliance.

1st Contact Tax offers specialist tax services to contracting professionals.
These services include: Contractor Accounting,  Personal Tax for Contractors, Limited Companies for Contractors and Contractor Financial Advice.