Over the last year (year end 31st March 2020) UK businesses overpaid at least a whopping £9.1 billion in corporation tax according to UHY Hacker Young . This figure has risen significantly from £8.1 billion the previous year. The figures come from the total amount refunded to businesses over HMRC’s tax year which spans 1st April-31st March.
Given the current recession as a result of the ongoing coronavirus pandemic this figure may increase further this year, as companies may have made estimates to their profits prior to the lockdown. In a time when every penny is vitally important to the majority of companies, businesses will need to be hyper-vigilant when submitting returns this year.
Given that the corporation tax regime (unlike PAYE) has no system for refunds to be processed automatically. If companies fail to carry back losses and request a refund in-time they may end up forfeiting any relief due on over-payments.
The application process for refunds where a return is yet to be submitted can be rather tortuous, as such it may be beneficial for companies to file returns earlier than usual this year rather than waiting until closer to the deadline.
If you are looking for any assistance with corporation tax returns or any other taxes get in touch with us.