New Ltd. Can you submit CT41G Dormant & submit CT41G a few weeks later?

[GordonBennettUK]

Have set up a new Ltd company but have not traded yet as the whole concept is in development.

Received CT41G and the Dormant Company Insert forms from HMRC. We really don't believe we will realistically be trading (making a payment or receiving any monies) for at least 6 weeks, more like 8 weeks or more. So to give us a bit more breathing space can we send back the CT41G Dormant Company Insert now and then if the business does get launched sooner than we currently expect, we can send in a CT41G at the time we start trading, whenever that is? i.e. I'm asking if it matters if unexpected events mean you're trading before you thought you would be, so you send in a CT41G fairly soon after you've sent in a Dormant Insert?

Thanks!

[DickM]

1.1
If your company has started any activity
The law says that you must give us certain information within 3 months of the company starting its first accounting period. An accounting period starts when a company comes within the charge to Corporation Tax – that is, broadly, when it begins any business activity. For example, an accounting period begins as soon as a company acquires a source of income, such as starting up a business or acquiring an investment or any other asset which will produce income or may be sold.
If you’re not sure whether the company has come within the charge to Corporation Tax, ask your agent if you have one or
contact the HMRC office shown on the form CT41G New Company Details. You can give us all the information we need by filling in the form CT41G New Company Details. There’s advice on how to complete the form later in these Notes. You don’t have to use our form but it’s the easiest way to tell us.
If you prefer, you can let me have the information in a letter, signed by an officer of the company, which includes a declaration
that the information is correct and complete to the best of their knowledge. Send us this information as soon as possible. There are penalties for not providing it which can be as much at £300 plus a continuing daily penalty of £60 for every day that the information remains outstanding. There can also be a penalty of up to £3,000 if the company fraudulently or negligently gives incorrect information.
CT41G Notes Page 1 HMRC 09/09 1.2
If your company is not active yet
We treat a company as dormant if it has not started, and is not about to start, any business activity. It’s in your interests to
tell us if your company is dormant so that we don’t send you unnecessary correspondence or ask you to complete tax forms. It’s easy to do that using the CT41G Dormant Company insert. Follow the advice on the form. The tick box format makes it easy to tell us that the company isn’t active, when you think it will start, or that you don’t yet know.
Please keep these Notes and the form CT41G New Company Details to use when the company becomes active.

In your case, I would see where you are regards "trading" after 11 weeks have elapsed, then if still in the development mode send in CT41G Dormant.
However, if you have started trading by then - send in CT41G New Company Details.
HMRC are only laying down the rules for those who think they can "keep their heads below the parapet" and put off the evil day of appearing on their Corp Tax radar as long as possible.

It's a case of obeying the letter of the law, or it's intent. My recommendation covers the both!


Good luck with your venture!

[GordonBennettUK]

Thanks very much for your reply. We are actually already 10 weeks in after incorporation, and still very much in the development stage, perhaps only about 50% of the way through it, so we expect it will be at least another 8 weeks from now til we start any business activity.

But reading the notes accompanying the form, we have to submit the CT41G or Dormant form within 3 months (12 weeks) of starting our first accounting period, or any 'business activity'.

So we're not in week 10 of 12 already, are we, if we haven't come into any corporation tax charge yet as we've done no business activity yet? So we actually have another 12 weeks after we start business, which may be about 8 weeks from now, so the form needs submitting 20 weeks from now?

Hope I've not confused you! It may be better for us just to send in the Dormant form now?

[DickM]

Let me have your Ltd Co's name, and then a more definitive answer can be made after checking Co House's website record.