The Loss of Reliefs for the Late Submission and Incomplete Return of Corporation Tax Returns

Under Section 1085 of the Taxes Consolidation Act, 1997 claims to a number of reliefs are restricted where tax returns are submitted late. The amount of the restriction is calculated by reference to whether the return is late by more than 2 months or less. The restriction is computed as a percentage of the relief that would otherwise be available subject to a maximum restriction depending on the length of the delay in filing. If the return is filed less than 2 months late the restriction for the chargeable period is £31,740. If the return is filed more than 2 months late the restriction is £158,715 for the chargeable period. The reliefs which are subject to these restrictions are as follows:

1. Excess capital allowances
2. Loss relief: sections 396(2); 396A(3); 396B(2) and 399(2) of the TCA 1997
3. Group relief claims
4. Group relief: surrender of “losses”: sections 420; 420A(3) and 420B of the TCA 1997

If a company has a liability to a close company surcharge or income tax due on loans to participators/annual payments these must be included on the Form CT1. If the Form CT1 return does not include these the Form CT1 will be deemed incomplete. An incomplete Form CT1 may be subject to interest and a surcharge under section 1084 on the basis that the company failed to submit a correct return.

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