24 Mar 2020

Corporation Tax and Cashflow Planning

Planning

Through these unprecedented and uncertain times it is important to identify areas where short term planning and changes may be required due to the impact of Covid-19. If you have any concerns, please complete our Business Healthcheck Questionnaire and send it back to your usual MHA Monahans representative.

Please see below tips you can do relating to corporation tax and cashflow.

  • All businesses may be eligible to receive support with their tax affairs through HMRC’s Time To Pay service. If you have already missed a tax payment or you think you might miss your next payment due to COVID-19, please call HMRC’s dedicated helpline on 0800 0159 559 to discuss a facility.
  • For those companies that make quarterly payments of corporation tax it is going to be vital to stay on top of bookkeeping and profit forecasting – quarterly instalments are flexible and can be increased/decreased where necessary. If you are anticipating a drop in profits over the coming months you can take this into consideration in calculating your future quarterly payments – where profits are expected to be lower, reducing your payments to HMRC will have a positive impact on your cashflow.
  • If you have already made quarterly instalments of corporation tax that you believe might not have been due, contact HMRC – you may be able to claim these payments back.
  • Consider completing your accounts and corporation tax returns much earlier than you would usually have done – this will give you time to plan ahead for any tax payments that may be due or may enable you to obtain a repayment of tax from HMRC more quickly.
  • If you are part of a group of companies, communicating with your group where possible is going to be important to ensure that any losses are being fully utilised. Losses can often be relieved to other members of the corporate group to reduce their taxable profits. This will have a direct impact on corporation tax payments and the group’s cashflow position. If you require any assistance with group losses or any other relief, please do not hesitate to contact us.

Download our Business Healthcheck Questionnaire here.