Changing Your Company Year End: CT600 & Tax Implications

Changing Your Company Year End: CT600 & Tax Implications

Changing your accounting reference date (year end) creates a short or long accounting period — with implications for your CT600.

How to Change Your Year End

File form AA01 with Companies House. You can:

• Shorten your accounting period (to a minimum of 1 day, as often as you like)
• Extend your accounting period (to a maximum of 18 months, normally only once every 5 years)

Companies House shares the change with HMRC, but it's worth checking that your HMRC online account shows the correct Corporation Tax accounting period dates afterwards.

CT600 Implications

Short Period

If you shorten your year end, you'll have a period shorter than 12 months.

Example: Year end was 31 December, changing to 31 March. Your next period is 1 January 2026 to 31 March 2026 (3 months).

Effects:

• Corporation Tax thresholds are prorated (e.g., small profits rate limit: £50,000 × 3/12 = £12,500; upper limit: £250,000 × 3/12 = £62,500)
• Capital allowances are prorated (AIA: £1M × 3/12 = £250,000)
• Filing deadline: 12 months from the short period end
• Payment deadline: 9 months + 1 day from the short period end

Long Period (Over 12 Months)

A Corporation Tax accounting period can never be longer than 12 months. If you extend your year end so that your accounts cover more than 12 months, the period of account is split into two accounting periods — the first 12 months, then the remainder — and you file two CT600s.

Example: Year end extended from 31 December 2025 to 31 March 2026, so your accounts cover 1 January 2025 to 31 March 2026 (15 months). This splits as:

• CT600 #1: 1 January 2025 to 31 December 2025 (the first 12 months)
• CT600 #2: 1 January 2026 to 31 March 2026 (the remaining 3 months)

For the split:

• Profits are normally time-apportioned between the two periods (unless you prepare separate figures for each)
• Tax thresholds and the AIA are prorated for the short second period (3/12 in this example)
• Each return has its own payment deadline: 9 months + 1 day after that accounting period's end
• You prepare one set of accounts covering the whole long period and attach it to both returns

Common Reasons for Changing

1. Aligning with the tax year — 31 March year end simplifies tax planning
2. Seasonal businesses — align year end with quiet period
3. Group alignment — match parent company's year end
4. First year adjustment — new companies often change from the default

Tax Planning Opportunity

Changing your year end can be a powerful tax planning tool:

• Short period = lower thresholds — but also lower tax if profits are falling
• Timing capital allowances — bring AIA claims into a specific period
• Loss utilisation — create a short period to isolate losses, which can then be relieved under the loss rules (for example, carried back against an earlier profitable period)

Filing with Taxpipe

Taxpipe handles short accounting periods correctly — we prorate the Corporation Tax thresholds, marginal relief bands, and capital allowances automatically. For a long period of account, you file two returns (one for each accounting period), apportioning your figures between them.

Changing your year end? File your CT600 with Taxpipe — we handle short periods, prorating, and marginal relief automatically. £59.