Sprocket Ltd is a stand-alone company that has prepared accounts to 31 December and generated profits of 100,000-£500,000 each year. During 2021 the company was bought by a group and the new owners required the company to draw up accounts to 30 June to align it with the group’s year.

Sprocket’s directors have pulled together the records needed for an 18-month period of account to 30 June 2022 and have asked for some clarification of how the changes will affect when the corporation tax return needs to be filed and the amount of corporation tax due.

Because the period which a corporation tax return covers (corporation tax accounting period) is limited to 12 months by section 10 of Corporation Tax Act 2009 (CTA 2009), two separate CT600 returns are needed for the period. However, because the period of the accounts has not exceeded 18 months, the due date for both corporation tax returns is 30 June 2023, according to paragraph 14 Schedule 18 Finance Act 1998 (FA 1998) (HMRC manual CTM93030).