Lack of information

Over the last year or so unincorporated businesses have been bombarded with guidance from HMRC about declaring coronavirus support payments. By comparison, guidance for companies has been sparse but HMRC has now updated its guidance.

Corporation tax return

When completing a company self-assessment tax return or checking one prepared by an accountant, HMRC says that special care is needed regarding Coronavirus Job Retention Scheme (CJRS) grants and Eat Out to Help Out payments. If a company received either or both types of payment in the corporation tax (CT) period covered by the return, it must both:

• include it as income when calculating  taxable profits in line with the relevant accounting standards; and
• report it separately on the company tax return using the special CJRS and Eat Out to Help Out boxes.

How much to declare

When calculating the amount of CJRS payments to declare in Box 471 on the company’s CT return it must not deduct any amounts:

• which were voluntarily disclosed to HMRC as CJRS overpayments, even if the company has repaid them
• that have already been assessed by HMRC, even where the company accepted and paid the assessment
• received that the company was entitled to but repaid voluntarily.

Conversely, the company must add any overpayments of amounts received in an earlier CT period that have been set off against CJRS payments received in the accounting period for which it is now completing a tax return