January 21, 2016 Filing on time
In our last article we talked about the pattern of the year and about the importance of strengthening corporate governance through the pursuit of clear accounting practices and reporting. As a follow-up to that article we’re going to look at another annual milestone which applies to all companies and we’re going to start with a simple question; when are you due to file your accounts?
If you don’t know, then it may be worth your while to find out and to ensure that that date is etched indelibly in the diaries of accountants, auditors and directors. It’s a fairly simple date to calculate but missing it can lead to fines for the company and potential criminal charges being laid against its directors. Apart from new organisations and those which have changed their accounting date, a public company has six months from the end of the accounting reference period in which to deliver its accounts to Companies House, whilst a private company has nine months.
However, whilst the date is simple to calculate, it appears that the need to meet the filing deadline is catching out considerable numbers of companies. According to government statistics in the year 2014-15 across the UK 174,068 late filing penalties were imposed. Sadly, it seems as though matters have improved little in the current year with 115,168 penalties imposed in the eight months to the end of November 2015.
Whilst it is possible to appeal late filing penalties, and indeed in the year 2014-15 nearly 21,000 appeals were made, only about 20% of appeals resulted in the decision being made either to waive or not to pursue the collection of the penalty. In April 2015 the government issued a PDF giving guidance on filing accounts, late filing penalties and the appeals process. The guidance clearly shows that fines will not be waived unless the circumstances are exceptional. This means that excuses such as the accountant being ill or not being familiar with the filing requirements are not sufficient grounds for penalties to be waived.
On the positive side, the government recognises that natural disasters such as the floods seen in December should be taken into consideration. Accordingly, if companies have been affected by the floods, they can apply to Companies House for an extension on their filing date. When are you due to file your accounts? You owe it to your business and to yourself to ensure that this year you file on time.