HMRC have confirmed that a number of current issues involving the filing of Corporation Tax returns will be solved on 16 September when an update to the Corporation Tax online service is rolled out. Issues ranging from claiming the extended AIA to R&D SME tax credits have meant some companies have been unable to file online as yet.

 The Corporation Tax online service has yet to be updated for a number of claim options. Companies are currently unable to file online if they have any of the following claims or charges:

  • Annual Investment Allowance (AIA) claims over £200,000 due to the temporary extension of the £1 million cap announced in the Autumn 2021 Budget.
  • S.455 charges on Loans to Participators where the relevant tax rate is 33.75% and not 32.5%.
  • Claims for brought-forward non-trading losses on intangible fixed assets (Box 265) which exceed current year non-trading losses on intangible fixed assets (Box 830). This will give rise to an error message.
    • The workaround to this is to ensure the two boxes are equal but include the correct amount for Box 830 in the accompanying calculations.
  • Research & Development (R&D) Small and Medium Enterprise (SME) payable tax credits or R&D expenditure credits (RDEC). There is also an issue in claiming enhanced expenditure, where neither of the aforementioned credits is being claimed.

All of these issues will be resolved in the update of the Corporation Tax online service which will be available from 16 September 2022.

There is an additional issue with reporting brought forward R&D step 2 restriction amounts where there is no RDEC claim in the current period. This issue will not be rectified until 6 April 2023.

Companies unable to file online can file a paper return instead. If filing a paper claim due to R&D issues, a Form WT1 should also be filed (Box 6).

Small acorn
If you like our content come and join us.

Thousands of accountants and advisers and their clients use as their primary TAX resource.

Register with us now to receive our FREE weekly SME Tax News update.