Corporation Tax - Fears over 14 July deadline
Companies making payments under the new corporation tax self-assessment system ahead of next week’s deadline could find their money going astray due to the Inland Revenue’s failure to send out payslips, tax experts have warned.
Around 10,000 companies are gearing up for their first taste of CTSA on July 14 – the deadline for December year-end. Companies expecting to make annual profits above £1.5m are to make their first tax payments on account.
But tax practitioners warned this week many had not received the payslips needed to make payments.
Grant Thornton tax partner Mark Vyner said: ‘They just don’t seem geared up to sending out payslips.’ Predicting payments could go astray, he added: ‘The whole thing could be a bit messy.’
John Whiting, tax partner at PricewaterhouseCoopers, said some companies would be sending off money, hoping it would end up in the right account.
Both warned companies to put their reference numbers on all cheques.
A Revenue spokeswoman said payment slips had been sent out to as many affected companies as could be identified from its records.
She said £451m had been collected from 2,150 companies under CTSA so far, and the Revenue expected to receive a lot more around the July 14 deadline.
The confusion surrounding payment slips is one of many concerns about CTSA.
The major difficulty for affected companies is that payment on account is based partly on profits which have yet to be earned and are impossible for them to estimate accurately.
Charities specialist Vincent Guiry of Fraser Russell said many charities would be forced to reconfigure their accounting computer systems to handle the burden of additional red-tape.