12 Common CT600 Mistakes That Cost Directors Money
Filing your own CT600 can save hundreds in accountancy fees. But mistakes can cost more than you save. Here are the 12 most common errors we see — and how to avoid each one.
1. Wrong Accounting Period Dates
The mistake: Entering incorrect dates in boxes 30 and 35. This is surprisingly common when companies have changed their year end or have a short first period.
Why it matters: If your period dates don't match HMRC's records, your return will be rejected. Even worse, filing for the wrong period means the correct period shows as unfiled — triggering late filing penalties.
How to avoid it: Check your CT603 notice from HMRC, which confirms the period they expect you to file for. If in doubt, check your HMRC online account.
2. Claiming Personal Expenses
The mistake: Including personal costs as business expenses — home broadband, personal phone bills, family car insurance.
Why it matters: HMRC can disallow the expense, add penalties, and open a wider enquiry into your records.
How to avoid it: Only claim expenses incurred "wholly and exclusively" for business purposes. Mixed-use items (like a phone used 50% for business) can be partially claimed, but keep records of the business percentage.
3. Forgetting to Claim Capital Allowances
The mistake: Treating equipment purchases as expenses instead of claiming capital allowances, or simply forgetting to claim them.
Why it matters: Capital allowances (especially AIA at £1,000,000) can reduce your taxable profit significantly. A £10,000 laptop purchase at 19% saves £1,900 in tax.
How to avoid it: Keep a fixed asset register. Claim AIA on qualifying equipment, and writing down allowances on items that don't qualify for AIA.
4. Incorrect Treatment of Director's Loan
The mistake: Not declaring an overdrawn director's loan account (where you've taken more money out than you've put in).
Why it matters: Overdrawn director's loans over £10,000 trigger a Section 455 tax charge of 33.75% on the outstanding amount. This must be reported on the CT600.
How to avoid it: Track your director's loan account monthly. Repay any overdrawn balance before your corporation tax payment deadline to avoid the S.455 charge.
5. Missing the Marginal Relief Calculation
The mistake: Applying the 25% rate to all profits over £50,000 instead of calculating marginal relief, or forgetting to account for associated companies.
Why it matters: Marginal relief reduces the effective rate from 25% down to 19% across the £50,000-£250,000 band. Getting this wrong means overpaying tax.
The formula: HMRC's marginal relief fraction is 3/200. For a company with profits of £100,000 and no associated companies, the relief is:
3/200 × (£250,000 - £100,000) × £100,000/£100,000 = £2,250
This reduces your tax bill from £25,000 (at 25%) to £22,750 — an effective rate of 22.75%.
6. Not Declaring Bank Interest
The mistake: Forgetting to include bank interest as income. Even dormant companies with interest-bearing accounts have taxable income.
Why it matters: Undeclaring income is tax evasion, even if unintentional. HMRC receives data from banks and can match it to your return.
How to avoid it: Check every bank statement. Include all interest in your CT600, even amounts under £1.
7. Wrong Company Type Code
The mistake: Selecting the wrong company type in box 4. The most common error is choosing code 6 (Members' club) instead of code 0 (UK trading company).
Why it matters: Different company types have different tax treatments. The wrong code can lead to incorrect calculations and HMRC queries.
How to avoid it: Most private limited companies (Ltd) are type 0. Only select a different type if you're specifically a members' club (6), OEIC (1), or other special category.
8. Filing Late
The mistake: Missing the 12-month filing deadline. Usually because directors confuse it with the payment deadline or simply forget.
Why it matters: Penalties start at £100 for one day late, increase to £200 after 3 months, and reach 10% of the tax bill after 6 months. Three consecutive late returns doubles the initial penalty to £500.
How to avoid it: Set a calendar reminder 2 months before your filing deadline. The payment deadline (9 months + 1 day) is actually a good trigger — when you pay, file at the same time.
9. Inconsistent Figures Between Accounts and CT600
The mistake: The turnover or profit figures in your CT600 don't match your statutory accounts.
Why it matters: HMRC cross-references CT600 figures with the accounts you submit. Discrepancies trigger automatic queries.
How to avoid it: Prepare your accounts first, then use those final figures for your CT600. Tax adjustments (capital allowances, disallowable expenses) should bridge any differences.
10. Not Claiming Loss Relief
The mistake: Your company made a loss but you didn't carry it forward (or back) to offset against other profits.
Why it matters: Trading losses can be:
- Carried forward indefinitely against future trading profits
- Carried back 12 months against previous year's profits (for an immediate tax refund)
- Set against other income in the same period
Missing a £20,000 loss claim at 19% costs £3,800 in future tax savings.
How to avoid it: Always claim trading losses, even if you're not sure when you'll use them. There's no deadline for carrying forward — but carrying back must be claimed within 2 years.
11. Incorrect R&D Tax Relief Claims
The mistake: Either missing a valid R&D claim entirely, or claiming for work that doesn't qualify.
Why it matters: R&D tax relief can be worth 10-33% of qualifying expenditure. But invalid claims attract penalties and repayment demands.
How to avoid it: R&D must involve seeking an advance in science or technology that isn't readily available. Software development, product design, and process improvement can qualify. When in doubt, get specialist R&D advice.
12. Paying Tax to the Wrong Reference
The mistake: Using an incorrect payment reference when paying HMRC.
Why it matters: HMRC can't match your payment to your company. You'll get chasing letters for "unpaid" tax despite having paid.
How to avoid it: Your corporation tax payment reference is your UTR + "A" + two digits. Find it on your CT603 notice or HMRC online account. Double-check every digit.
The Bottom Line
Most CT600 mistakes come from lack of knowledge, not negligence. Filing software catches many of these errors automatically — flagging missing data, validating calculations, and ensuring HMRC compliance.
Taxpipe's guided wizard walks you through every box, highlights common pitfalls, and calculates your tax correctly — including marginal relief, capital allowances, and loss relief.
File your CT600 correctly → — £59, with built-in error checking and HMRC validation.
Related: CT600 box-by-box guide