Company tax returns must include COVID-19 grants says HMRC
Taxpayers are being reminded that COVID-19 support grants or payments should be declared on company tax returns as they are taxable.
HM Revenue & Customs (HMRC) has issued a reminder that the filing deadline for company tax returns (CT600) is 12 months after the end of the accounting period it covers.
The deadline to pay Corporation Tax will depend on any taxable profits and when the end of the accounting period occurs.
HMRC says that Coronavirus Job Retention Scheme (CJRS) grants, Eat Out to Help Out (EOHO) payments, or any other support payments made by local authorities or Government, must also be reported as income when calculating taxable profits.
Company tax return
If you received a CJRS grant or an EOHO payment, you will need to do both of the following:
You should record all other taxable COVID-19 payments as income when you calculate your taxable profits.
If you have already filed a return and have not declared your Coronavirus support grants or payment as taxable income, you will need to submit an amended return.
CJRS grants or EOHO payments must be reported separately in the boxes provided on the CT600 corporate tax return. These boxes were added on 6 April 2021.
It is important to update third-party software by downloading the latest version to be able to complete the relevant boxes in the company tax return.
Taxable grants include:
When furloughed employees were paid through real-time information (RTI), the employer was responsible for making the usual PAYE, National Insurance contributions (NIC) and automatic enrolment deductions.
Employers must treat the grant as taxable income for Corporation/Income Tax purposes but can deduct employment costs as normal when calculating their taxable profits.
“Richard Anthony case study – Terry Lewis – Jaques Samuel Pianos Widely considered to be London’s leading piano retailer, Jaques Samuel Pianos has grown considerably from its humble beginnings in the front room of Mr Samuel’s home in Notting Hill. They are now internationally recognised and have provided pianos for high-profile clients like Queen and […]”
Terry Lewis – Jaques Samuel Pianos
“Richard Anthony: ‘a super-star firm’ MT Finance is a property finance lender, specialising in bridging loans and auction finance. They assist numerous property professionals, business owners, and individuals with their finance requirements and specialise in short-term asset-based lending. Founder and Director, Tomer Aboody, knew that as an asset-based lender, the business would require an expert […]”
Tomer Aboody – MT Finance
“A family fairground success story The Botton family have been running a traditional fairground, arcade and amusement park in the heart of Skegness since taking over the Pleasure Beach in 1965. Jim, the Director of the company, took over from his father and now heads day-to-day activities and administration. He said: “The Pleasure Beach is […]”
Jim Botton – Pleasure Beach (Skegness)