With the ongoing tax law changes in the UK, Accounting firms of all sizes actively seek new and innovative ways to streamline their operations and ensure compliance. While there has been tremendous development in the technology space for tax filing and HMRC’s push for Make Tax Digital (MTD), Accounting firms have yet to embrace these changes fully and rely on technology for their tax processing.Â
This is why outsourcing UK corporate tax returns remains the most effective and reliable means of handling tax preparation and filing among accounting firms.
In this blog, we cover:Â
- Benefits of outsourcing corporate tax returnsÂ
- UK tax deadlines for 2025Â
- How to stay HMRC compliant when outsourcingÂ
- What to look for in a tax outsourcing provider
Why UK Accounting firms Are Outsourcing Corporate Tax Returns
Outsourcing corporate tax returns for accounting firms offers a wide array of business benefits, from straight-up cost savings to strategic growth. However, the biggest advantage that Accounting firms get with outsourced corporate tax returns is compliance with HMRC and timely tax return preparation and filing.
Here's a breakdown of why companies choose to outsource this function:
Expertise and Accuracy
To say that UK tax laws are complex would be an understatement. With frequent updates to corporation tax rates, capital allowance rules, and R&D tax credits), it can get overwhelming even for the most prominent accounting firms. By partnering with qualified CPA outsourcing service providers, accounting firms attain straight access to qualified tax professionals, comply with current legislation, and reduce the risk of costly errors or penalties.
Cost Efficiency
Building an in-house tax team can be draining for accounting firms. Skyrocketing salaries, expensive tools, and investment in training and development can put extra stress on your overall budget. On the other hand, outsourcing reduces the overhead of hiring and maintaining an in-house team while providing easy access to qualified tax professionals.
Time Savings
Preparing corporate tax returns is time-consuming and can take up ample time and resources away from core business activities. However, partnering with an outsourcing service provider lets you focus on your growth strategy, planning, and value-added tasks.
Access to Tax Planning Opportunities
Professional tax preparation experts are keen to identify reliefs, allowances, or deductions (e.g., loss carrybacks, patent box, group relief). As a result, you get enough opportunities for tax savings or improved cash flow.
Risk Management
Outsourced tax filing UK services also help Accounting firms mitigate risks that come along with incorrect filings and penalties. The tax preparation outsourcing service providers ensure that you meet your tax deadlines and that your filings follow the HMRC guidelines.
UK Tax Filing Deadlines
Understanding UK tax filing deadlines is critical for compliance. Corporate tax returns are filed annually, and missing any deadline can result in unwanted penalties and irreparable damage to your brand.
UK Corporate Tax Filing Deadlines (Corporation Tax)
1. Corporation Tax Payment Deadline
- Deadline: 9 months and 1 day after the end of your accounting period.
- Example: For organizations having a year-end of 31 March 2025, tax must be paid by 1 January 2026.
- Note: For large enterprises (profits > £1.5 million) must pay in installments.
2. Corporation Tax Return Filing Deadline (CT600)
- Deadline: 12 months after the end of the accounting period.
- Example: For the year ending 31 March 2025, the return must be filed by 31 March 2026.
- Note: The CT600 must be filed electronically with HMRC, usually via approved software.
3. Company Accounts Filing (with Companies House)
- Private limited companies: 9 months after the end of the financial year.
- Example: Year-end 31 March → Deadline = 31 December.
- Public limited companies (PLCs): 6 months after year-end.
4. Confirmation Statement (Companies House)
- Deadline: Every 12 months from either:
- the date of incorporation or the date of the last confirmation statement.
- Note: It must be filed within 14 days of the end of the review period.
5. VAT Returns
- Usually, it is due every quarter.
- Deadline: 1 calendar month and 7 days after your VAT accounting period ends.
- Example: VAT quarter ending 31 March → Return and payment due by 7 May.
6. PAYE / Real Time Information (RTI)
- Monthly FPS (Full Payment Submission): On or before each payday.
- PAYE payments: Due by the 22nd of each month (if paid electronically).
HMRC Compliance for Outsourcing
When outsourcing UK corporate tax returns, or any tax return for that matter, it’s essential to ensure compliance with HMRC regulations. You must ensure that all the records are maintained accurately, the submissions are timely, and the UK tax laws are completely adhered to.Â
Here are a few ways in which you can ensure full compliance with HMRC: When outsourcing corporate tax return preparation or other tax-related functions, it’s crucial to remain compliant with HMRC regulations. While the preparation work can be outsourced, legal responsibility for tax compliance always remains with the Company and its directors.
1. Compliance Responsibility Remains with the Company
- Even though you are outsourcing, you will still be responsible for:
- Filing accurate tax returns Making timely payments
- Maintaining adequate recordsÂ
For HMRC, any inaccuracy or missed deadline will be the responsibility of the CPA firm, not the outsourcing service provider.
2. Authorised Agent Registration
Whether you are partnering with a accounting firm for tax return preparation or hiring a tax agent, you must formally authorize them using the following:
-
- Form 64-8 (paper form), or
- Online authorisation via HMRC’s Agent Services Account
Authorizing your tax return preparation partner means they have the legal authority to access your records, submit returns and correspondence, and deal with queries.
3. Data Protection and GDPR
Most CPA outsourcing services providers comply with UK GDPR. You must ensure that:Â
- Financial data (payroll, tax returns, bank info) is securely accessed.Â
- You have a data processing agreement (DPA) in place outlining:Â
- Data accessÂ
- Usage RestrictionsÂ
- Security ProtocolsÂ
- Breach notification policies.
4. Record-Keeping Requirements
- HMRC demands that organizations retain the following:Â
- Accounting records for 6 yearsÂ
- Tax records that support CT600 filings
- including: InvoicesÂ
- Bank statementsÂ
- Expense reportsÂ
- Capital asset informationÂ
Your outsourcing partner must help ensure these are adequately maintained.
5. Timely Filing and Payments
Your firm will always be held responsible for filing returns and making payments on time:
- Corporation Tax (CT600)
- VAT Returns (if VAT registered)
- PAYE/NI (if employing staff)
Conclusion
If you’ve taken care of all these things regarding outsourcing UK corporate tax returns, you are ready to reap the significant business benefits of outsourcing in the form of increased expertise, benefits, efficiency, and risk management. Any CPA firm must ensure you’re partnering with the right outsourcing partner. However, if you still have some doubts and queries, you can always write to us at [email protected], and we will help you outsource your tax preparation with absolute safety and compliance.
FAQs
Can I legally outsource UK corporate tax returns?
Yes, it is legal to outsource UK corporate tax returns. However, businesses must ensure that their outsourcing partner complies with HMRC regulations and maintains accurate records. Â
What should I look for in a tax outsourcing partner in the UK?
Look for a partner with expertise in UK business tax compliance, a strong reputation, secure technology, and responsive support.
How does outsourcing affect HMRC filing?
Outsourcing can streamline HMRC filing by ensuring accuracy and timely submissions. Professional tax services are familiar with HMRC requirements and can help mitigate risks associated with incorrect filings.
