How Do I Get A Unique Tax Reference For My Company?
With tax evasion one of the major concerns in most developed countries, it is only natural that the government would step to keep a check on that. The Unique Tax Reference (UTR) is how the government makes sure that you don’t have any unpaid tax attached to your company.
There is not much work involved since most of the steps are automatic. The HMRC is immediately notified as soon as you register your company, and you will be granted a 10-digit unique tax reference number (also known as Corporation Tax Reference).
Applications of UTR
In a way, your UTR is your ID proof every time you are dealing with the HMRC or filing your company tax return. Although UTR is one of those details used solely for the official purpose, most people would not notice it. However, as the owner of a company, you have to be careful with your UTR (yes, as a tax-paying individual, you will also be issued a UTR) and that of the company.
Use of UTR
One of the most prevalent misconceptions is that one needs to submit complete tax details while forming a limited company. In reality, the HMRC puts together the complete tax information on its own after a company is formed. However, a company formation agent might need the UTR in order to ensure that your company is registered under corporation tax.
The full documentation about tax obligations will be received by you once your company is formed, most probably via mail. Some amount of details might be required to be submitted once your business becomes operational.
Requirements of HMRC
One of the reasons why tax filing scares a lot of people is because how tedious it is. However, we cannot really blame the HMRC, since tax evasion cases are on the rise and hence the agency wants to be airtight with its dealings. Hence, the best course of action is to hire an agent who could help you out in collecting all the necessary documents and filling out the details.
The details you would need to submit to the HMRC include the beginning date of your business trading, your office address and the registration number of your company. Additionally, a SIC code might also be required, which your agent could obtain for you.
Once all the details are submitted, the HMRC will send a letter to your registered office address. This would contain the confirmation for the deadlines of your business, and you would need to stick to these deadlines for filing out your tax returns. Technically, corporation tax has to be paid for a minimum period of 9 months and a day, but the actual return filing begins much earlier than that. In case you have a good reason for wanting to change your accounting period, you could request the HMRC for the same; however, the final decision rests with them.
The need for an Agent
Like we mentioned earlier, having a company formation agent can make your life way too easy. Tax returns are a complicated job, with minor mistakes having the potential to land you in legal trouble. Things might get even grimmer if you are a non-resident of the UK. Hence, always prefer to seek the help of an agent who could give your company a good start.