The Accounting Reference Date - Everything You Need to Know
accounting reference date
What is the accounting reference date
Find out everything you need to know including how to change your accounting reference date.
Accounting reference dates are set by Companies House, the UK government body responsible for registering companies and maintaining records of company activity. They are used by HMRC to calculate tax liability and determine whether a company should be paying corporation tax.
Why is the accounting reference date important?
Companies House sets the accounting reference date for each company registered under their system. For most companies, this means the day the company was formed. However, there are exceptions.
If a company has been trading for less than three years, then the accounting reference date is the day the company was incorporated. If a company is being wound up, then the accounting reference period starts on the last day of the financial year before the winding up order is made.
What happens if I don't file my statutory accounts on Time?
If you fail to submit your annual return on time, you may face fines and penalties. These could include:
• A fine of £20,000 per person who fails to comply with the law
• A penalty of 10% of the amount due for late filing
• An additional fine of £10,000 per month for late submission
• A further fine of £10,00 per month for each subsequent month after the first month in which the return is not filed
How can I Change My Accounting Reference Date At Companies House?
You can only change your accounting reference date once every five years. To do this, you must apply to Companies House using Form CA/CAA/CAE.
To request a change, you must provide evidence that shows why you want to change the date. This includes any reasons why you believe the current date does not accurately reflect the start of your accounting period.
Choosing the Right Accounting Reference Date for Your Business
There are two main types of accounting periods:
• Annual accounting period - runs from 1 April to 31 March
• Half yearly accounting period - runs from 15 September to 14 August
For most companies, the annual accounting period is the best choice. This is because it gives you enough time to prepare your accounts for the following year. However, some companies use half yearly accounting periods. This is because they operate on a seasonal basis. For example, many retailers run sales promotions during specific times of the year.
Summary
The accounting reference date is the end of your company’s financial year
For new companies, this is the last day of the month that’s 12 months from the incorporation date of your company (e.g. a company incorporated on 22 May 2021 would have their first accounting reference date as 31 May 2022)
Your company accounts need to be filed nine months from your accounting reference date, so your first company accounts will be due 21 months from your incorporation date
Your corporation tax return is due 12 months from your accounting reference date
The deadline for paying your corporation tax is nine months and one day from your accounting reference date
You should aim to submit your return and make payment at the same time
Filing your company accounts/corporation tax return late carries respective minimum penalties (See link below for latest penalty charges)
You can change your company’s accounting reference date via the Companies House website (Link below)
You can only extend your company’s financial year once every five years
Your choice of accounting reference date can have significant tax implications please seek advice from your accountant before making changes.
Useful links
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