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HM Accountax Ltd
HM Accountax Ltd, Chartered Certified Accountant
Category: Tax
Satisfied Customers: 459
Experience:  I am an accountancy professional with more than10 years hand on experience in audit, accountancy and tax affairs.
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I need help accounting for a Corporation Tax refund. In FY18

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I need help accounting for a Corporation Tax refund. In FY18 the company made a profit and CT was calculated and paid accordingly. In FY19 it made a loss which I opted to carry back. In FY20 I received the corresponding (partial) refund from HMRC. How do I account for that receipt? If I post it to Corporation Tax, it shows up as a negative CT amount in FY20 (which isn't right). Surely I don't need to re-file accounts for FY18 and FY19 ...
JA: Which tax year is the refund for?
Customer: FY18
JA: Anything else you want the Accountant to know before I connect you?
Customer: I don't think so...


I am an advisor at JA and happy to assist you.

What entry did you posted in FY19? It should have been Dr Corp tax receivable (b/s) Cr Corp tax (P&L).

If you haven't done the above entry then you should just post the payment to Corp tax current year.

You don't need to amend 2018 or 2019 accounts.



Customer: replied 18 days ago.
I posted no entry in FY19. The company made a loss so there was no CT liability to account for. In FY20, I posted the receipt from HMRC to Corporation tax - so that's now showing on my P&L as a negative CT expense.

That's absolutely fine.

There should have been negative last year but you didn't posted the journal last year so its negative this year.



HM Accountax Ltd and 2 other Tax Specialists are ready to help you
Customer: replied 18 days ago.
OK. Thanks for your help. All done now.

Good stuff.

If you have any further queries then please feel free to contact me.