Chapter 6 - Claims and Returns
Part B: Returns
6.7 Self Assessment
6.7.1 All charities are subject to the Self Assessment legislation and must submit a tax return if either:
- they are asked to do so
- they believe that they may have tax to pay
6.7.2 Charities set up as trusts are within the Income Tax Self Assessment regime (ITSA). Their tax affairs will be dealt with on a Tax Year basis.
6.7.3 All other types of charities (for example companies limited by guarantee, bodies created by Royal Charter or Act of Parliament, Industrial & Provident societies or unincorporated associations) are within the Corporation Tax Self Assessment (CTSA) regime. Their tax affairs will be dealt with on an Accounting Period basis.
6.8 Accounts and Returns
6.8.1 Charities should not send a copy of their annual accounts to HMRC Charities unless requested to do so following the issue of a tax return (ITSA) or a formal Notice to File a tax return (CTSA).
6.8.2 If a charity believes that it may have to pay tax (because some or all of its income and/or gains are not exempt from tax), it should complete a tax return and the appropriate Charity Supplementary pages and send them to HMRC Charities.6.8.3 The forms are available to download from the HMRC website or can be ordered from the HMRC Forms orderline. The orderline number for ITSA forms is 0845 9000 404, the orderline number for CTSA forms is 0845 3006 555.
6.8.4 The Self Assessment legislation requires a charity to complete and submit a tax return if either it is asked to do so or it believes that it may have a liability to tax. Some charities will be asked to submit a tax return annually but most will only be asked to submit a return from time to time. HMRC Charities will select which charities it requires a tax return from and will issue formal notices to those charities.
6.8.5 A charity that is a Trust will receive a ‘Trust & Estate Tax Return’ (form SA900 (PDF 208K)). All other charities will receive a ‘Notice to File a Company Tax Return’. The Company Tax Return is form CT600 (PDF 131K).
6.8.6 If a charity receives either a tax return or a Notice to File it must complete and submit a tax return. A charity that completes a Company Tax Return must send a copy of its annual accounts with the return.
6.8.7 Both types of Self Assessment tax return have special charity supplementary pages which must always be completed in addition to the main tax return. The charity supplementary pages are available from the forms orderline (see 6.8.3 for telephone numbers) or can be downloaded from the HMRC website. If you have completed a Trust & Estate Return (SA900) you should complete the supplementary pages on form SA907 (PDF 67K). If you have completed a Company Tax Return (CT600) you should complete the supplementary pages on form CT600E (PDF 28K).
6.8.8 The charity supplementary pages include the claim to tax exemption and should show the income and/or gains for which the charity is claiming exemption. The supplementary pages must be signed and dated.
6.8.9 The charity supplementary pages also require confirmation that the expenditure of the charity has been for charitable purposes only (see Technical Annex II for details) and that any investments or loans made are qualifying investments or loans under the Taxes Acts (see Technical Annex III for details).
6.8.10 Where a charity claims exemption from tax on all its income and gains covered by the period in the return, it need only record `nil' in the relevant boxes on the main Trust or Company return (SA900 or CT600), and sign and date the form. Where a charity has incurred a tax liability on all or part of its income and gains, it will be necessary to show the taxable amounts in the relevant boxes on the main return as well as signing and dating the form.
6.9 Payment and filing dates
6.9.1 If a charity within the ITSA regime has a tax liability in a year of assessment it must make two payments on account: the first on 31 January in the tax year in question and the second on 31 July in the following the end of the tax year in question. Any balance still due must be paid by 31 January in the tax year following the year in question.
If a charity that is within the CTSA regime has a tax liability for an accounting period it must pay any tax due within nine months of the end of the relevant accounting period.
6.9.2 Failure to pay any tax due by the payment date will result in an interest charge.
6.9.3 The Trust Self Assessment Return (SA 900)and accompanying charity supplementary pages must be filed with HMRC Charities by 31 October after the end of the tax year if a paper copy is completed or by 31 January after the end of the year of assessment if the return is filed online.
The Company Self Assessment Return (CT 600), charity supplementary pages and annual accounts must be filed with HMRC Charities within twelve months of the end of the accounting period to which the return relates.
The filing date may be extended where the return is issued late.
6.9.4 Failure to file the return (including the charity supplementary pages and, if required, the accounts) by the filing date will result in a penalty charge.
6.10 Getting further help
6.10.1 There are notes to help with completion of the returns and the charity supplementary pages.
6.10.2 A charity receiving a request for a return should consider contacting its professional advisers for help in completing the return, particularly if figures need to be extracted from the accounts or a liability to tax assessed.
6.10.3 If there are specific problems in completing the charity supplementary pages, HMRC Charities may be able to help.
The HMRC Charity Helpline can be contacted as follows:
- by telephone on 08453 020203 (select option 5)
- by fax on 0151 472 6268
- in writing to the Charity Compliance Unit at
HMRC Charities
St John's House
Merton Road
Liverpool
Merseyside
L75 1BB
