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HMRC tax issue

realwalesrealwales Posts: 3,110
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in Advice #1
I, along with two other people, are directors of a small company that does not make a profit and has an annual turnover of less than £2,000 - it is a small management company for a block of flats.

There was a gap between the company being formed and us starting trading.

As soon as we started trading, I sent HMRC the form to inform them of the date we started trading, but have received very little correspondence from them since. They haven't demanded we submit our accounts, and haven't made any enquiries as to the status or activities of the company.

In contrast, Companies House posted us clear instructions as to how to submit our accounts, and we have done so.

Are we in trouble with HMRC? I've done my best to co-operate with them but they haven't exactly helped us by responding to our letters etc. The company began trading in September 2010, if this helps.

Comments

  • jrajra Posts: 48,325
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    #2
    If they wanted you to file your accounts, they should have sent you a letter informing you when the filing date is due. That's how it works for self assessment anyway.

    Anyway, with a turnover that low, let alone profit, you wouldn't be paying much tax, if any.
  • xmodz10xmodz10 Posts: 1,434
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    #3
    dont think you pay any tax if your turnover is under £5000 and something
  • DavidTDavidT Posts: 20,264
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    #4
    Okay if its a flat management company run for the residents then as a not for profit company there is no tax and nothing to send to HMRC. This assumes HMRC already know this. They will usually review the situation every few years to make sure nothing has changed.

    Effectively they treat it as dormant. Also you are not trading either if all you are doing is collecting fees from residents in order to pay joint costs such as insurance etc.
  • Keefy-boyKeefy-boy Posts: 13,613
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    #5
    DavidT wrote: »
    Okay if its a flat management company run for the residents then as a not for profit company there is no tax and nothing to send to HMRC. This assumes HMRC already know this. They will usually review the situation every few years to make sure nothing has changed.

    Effectively they treat it as dormant. Also you are not trading either if all you are doing is collecting fees from residents in order to pay joint costs such as insurance etc.
    I'm not sure that's correct. According to the HMRC website such a company would have to have no income other than interest income less than £1,000 pa.

    When HMRC will treat clubs and companies as dormant
    HMRC may also deem your club, society or company dormant for Corporation Tax purposes if it's active but meets specific criteria such as:
    if your company is a flat management company that has been set up to manage a block of flats, which has no income other than interest income under £1,000 that's taxed at source

    http://www.hmrc.gov.uk/ct/getting-started/trading.htm
  • realwalesrealwales Posts: 3,110
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    #6
    Thank you for all your replies guys - it appears unlikely I am in any real trouble but I will write to HMRC to confirm the situation.
  • tim59tim59 Posts: 47,188
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    #7
    I would have a word with your MP they seem to be very good when it comes to the tax man most MPs pay very little
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