Coronavirus: extensions to filing deadlines and changing reporting dates
26 March 2020: Companies House has advised that companies who are unable to meet their filing deadline due to COVID-19 will be granted an automatic and immediate three-month extension. However, companies must apply and applications must be submitted before the company’s filing deadline. Changing the year-end accounting date may also be an appropriate course of action for some companies in light of the current public health situation.
This article was created by the Financial Reporting Faculty. The faculty provides an extensive range of practical guidance to its members on common financial reporting problems.
The consequences of coronavirus (COVID-19) for companies are pervasive. One of the more immediate concerns is the ability of companies to file their accounts on time at Companies House.
Extensions to filing deadlines
Unless filing a company’s first set of accounts, filing deadlines are:
- nine months after the period end for a private company; and
- six months after the period end for a public company.
The law imposes an automatic penalty where these deadlines are not met.
In light of the current public health emergency, Companies House has advised that companies may apply for a three-month extension to their filing deadline if their accounts would otherwise be late due to COVID-19. Companies must apply for this extension, and applications must be submitted before the company’s normal filing deadline.
Companies are advised that the applications process should take only 15 minutes and are encouraged to make the application in good time.
To apply for the automatic and immediate three-month extension, companies will need:
- Their company number.
- Information on why more time is needed (site COVID-19 or Health reasons).
- Documents to support the application (optional).
Companies may not be eligible when they have already extended their filing deadline or shortened their accounting reference date.
If an extension is not applied for and accounts are filed late, an automatic penalty will be imposed. Although late filing penalties may be appealed, the registrar has very limited discretion to not collect a penalty.
Lengthening accounting periods
An alternative approach to delay when accounts must be filed by would be to lengthen the company’s accounting period. Subsequent accounting period(s) could then be shortened to return the company’s year end to its original date. However, there are certain restrictions and implications that should be considered carefully before selecting this option.
- Companies may only change their year end (their accounting reference date), be it to shorten or lengthen the accounting period, for their current financial year or the one immediately before. Year ends cannot be changed when accounts are overdue.
- Generally, companies can lengthen their accounting period to a maximum of 18 months and, unless certain criteria apply, the financial year can only be lengthened once every five years.
- Companies may change their year end by shortening their financial year (by a minimum of one day) as many times as they like.
Other types of organisation: charities
Charities needing an extension to their annual return filing deadline can apply for one to the Charity Commission. The commission assures charities that they will be as flexible and supportive as possible with regard to regulation during this period.
Financial Reporting Faculty
This guide is published by the ICAEW Financial Reporting Faculty. Recognised internationally as a leading authority on financial reporting matters, the faculty is responsible for formulating ICAEW policy and makes submissions to standard setters and other external bodies on behalf of ICAEW. The faculty provides an extensive range of practical guidance to its members on common financial reporting problems. To connect with like-minded professionals within this community and, to gain access to the full suite of exclusive resources, visit icaew.com/joinfrf.