CIC Association

Serving Community Enterprise

Hi. Ive worked out our first Annual Accounts following previous advice and questions on this forum. However, having submitted our accounts to Companies House, which have been accepted by CH, I now have to tackle Corporation Tax. Ive been on line to file the accounts - but following and answering the various questions, I got to one which asks: - "foreign currency transactions - where you are paid or pay someone in a currency other than pounds" I ticked yes to this, as we were sucsessful in getting a grant from Erasmus+ to develop youth exchanges. The system then said I couldnt file using the HMRC sofware and had to purchase private software! Having done some research I found (also on HRMC list) Quality Management Software Ltd. This alows us to pay as we go using their software which I would then pay a fixed fee to file our accounts. Most of our 'income' has been in the form of grants, usually for specific items such as our insurance, setting up a website, from local council grants. we also had a grant from Awards for All. OK thats the background. To complete the accounts software - I have to calculate out Turnover. Ive looked for help on line - but Im still unclear how to work this out. On the year we made a loss of £196.20 - this was due to a late payment of an invoice.

Ive attached the accounts we have filed with Companies House.

Regards

Liz

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Hi Liz, I think I have this right but please tell me if I have misunderstood. The turnover you will use on the Corp Tax reporting to HMRC will be the one used on the company accounts. However if you mean profit then for HMRC they want to see 'taxable profit' which can be different from the profit in the accounts. However with a quick look over the accounts I cant see anything which would be classed as 'disallowable' and therefore added back to the profit. Hopefully that helps? Thanks, Andy

Sorry, set up costs would be disallowed and therefore added back to the loss.

Hi Andrew, thanks for your reply.

Im stil not sure what figure to use for 'turnover" its 'what' plus/minus/divided by 'what'? Its a Turnover figure that the software asks for.

Regarding set up costs - these included a grant for insurance, website, printing - are you saying that for CT purposes we include that grant as taxable? or is it all the grants.

Sorry im more confused now - im sure its me not you.

Hi Liz, In the case of the CIC what I believe would be the turnover (based on the fact I haven't prepared the accounts) would be:

Income received in the year for services delivered in the year, together with

Income received from grants which have been spent/utilised in the year.

So assume you received £1000 for services given, then this would be included. But also you received £10,000 as a grant. You wouldn't include all the £10,000 unless you have actually used it. If you have only spent £5,000 of it, then you would only include the £5,000 and release the other £5k in which ever year it is spent.

Set up Costs. Usually in a set of accounts 'set up costs' are the costs paid to a provider to incorporate the business and these would be disallowed. However, the items you have mentioned would be fine.....make sure on the CT return you explain what these are as HMRC may view them the same as I did.

Hope that helps?

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