Running a UK limited company comes with a clear set of accounting obligations, and most founders underestimate what is actually involved until the first year-end deadline arrives. Annual accounts, Corporation Tax returns, VAT filings, payroll, bookkeeping, Making Tax Digital: each has its own rules, its own deadlines, and its own penalties for getting it wrong. This guide explains every accounting obligation a UK limited company faces in 2026, what professional accounting services cover, and why having the right support in place from day one is significantly cheaper than fixing problems later.
In this guide
- The accounting obligations every UK limited company has
- Bookkeeping services: what good bookkeeping looks like
- Annual accounts: what must be filed and when
- Corporation Tax return: deadlines and what is owed
- VAT returns and VAT accounting for UK companies
- Payroll and employer obligations
- Making Tax Digital: what changes in 2026
- Virtual business address and registered office
- What 1Office UK accounting services include
- Frequently asked questions
The accounting obligations every UK limited company has
A UK limited company is not a sole trader. The moment your company is incorporated at Companies House, it acquires a set of legal accounting and filing obligations that apply every year for as long as the company exists. These obligations are separate from each other, governed by different pieces of legislation, and submitted to different government bodies. Understanding the full picture is the starting point for any sensible accounting arrangement.
| Obligation | Filed with | Deadline | Penalty for late filing |
|---|---|---|---|
| Annual accounts | Companies House | 9 months after year end | £150 to £1,500 (doubles in consecutive years) |
| Corporation Tax return (CT600) | HMRC | 12 months after year end | £100 automatic; escalates to tax-based penalties |
| Corporation Tax payment | HMRC | 9 months and 1 day after year end | Interest at 7.75% from January 2026 |
| Confirmation Statement | Companies House | Annually from incorporation date | Criminal offence; company struck off |
| VAT return (if registered) | HMRC | Quarterly (1 month and 7 days after period end) | Surcharge starting at 2% of VAT owed |
| Payroll (RTI, if employing staff) | HMRC | On or before each pay day | From £100 per month depending on number of employees |
The payment and filing deadlines are different
One of the most common mistakes new company directors make is confusing the Corporation Tax payment deadline with the filing deadline. Your Corporation Tax bill is due 9 months and 1 day after your year end. Your CT600 return is due 12 months after your year end. The tax must be paid before the return is filed. Pay late and interest accrues immediately at 7.75% from January 2026.
From £99 per month. Annual accounts, Corporation Tax, VAT and payroll all included.
Bookkeeping services: what good bookkeeping actually looks like
Bookkeeping is the foundation of everything else. Annual accounts, VAT returns, Corporation Tax returns, and payroll all depend on accurate, up-to-date financial records. Poor bookkeeping does not just create extra work at year end, it creates inaccurate accounts, incorrect tax calculations, missed VAT reclaimable amounts, and the very real risk of penalties from both Companies House and HMRC.
What bookkeeping services cover
Professional bookkeeping services for a UK limited company include recording all income and expenditure in a categorised, double-entry accounting system; reconciling bank accounts monthly so the books match the actual money in the account; managing accounts payable (what the company owes) and accounts receivable (what is owed to the company); processing expense claims from directors and employees; and producing monthly or quarterly management accounts so the business owner understands the financial position without waiting for year-end accounts.
Online bookkeeping and cloud accounting
UK accounting services increasingly operate through cloud-based software such as Xero, QuickBooks, and FreeAgent, all of which are approved under HMRC's Making Tax Digital framework. Cloud accounting means your bookkeeper and your accountant work in the same system, your bank feeds update automatically, and you can see your profit and loss at any point in real time rather than waiting months for a report. 1Office UK uses cloud-based accounting tools accessible through the my1Office platform, providing clients with live visibility of their company finances in English.
Why online accounting services are better than year-end-only accounting
Many small UK limited companies attempt to manage their own bookkeeping throughout the year and then hand a shoebox of receipts to an accountant at year end. This approach creates several problems: the accountant charges significantly more for reconstructing a full year's records from scratch; errors and missed transactions are harder to identify and correct after the fact; VAT returns cannot be prepared accurately if books are not up to date; and the company director has no financial visibility throughout the year. An online accounting service that maintains books monthly costs less in the long run and eliminates all of these problems.
1Office UK provides monthly bookkeeping through cloud accounting software, fully remote and in English.
Annual accounts: what must be filed with Companies House
Every UK limited company must file annual accounts (also called statutory accounts or financial statements) with Companies House each year. These accounts become public documents, visible to anyone who searches for your company on the Companies House register. The format of the accounts depends on the size of your company.
Filing deadlines
Annual accounts must be filed with Companies House within 9 months of the company's accounting reference date (ARD). For a company with a 31 December year end, accounts are due by 30 September the following year. A company's first set of accounts is due 21 months after incorporation. If accounts are filed late, automatic penalties apply and increase the longer the delay continues.
Late filing penalties for annual accounts
| How late | Penalty (private company) | If late in consecutive years |
|---|---|---|
| Up to 1 month late | £150 | £300 |
| 1 to 3 months late | £375 | £750 |
| 3 to 6 months late | £750 | £1,500 |
| More than 6 months late | £1,500 | £3,000 |
What the accounts must contain
For small companies (below two of: £10.2m turnover, £5.1m balance sheet total, 50 employees), accounts filed with Companies House include a balance sheet and notes to the accounts. The profit and loss account is not required to be filed publicly. Micro-entities (below two of: £632,000 turnover, £316,000 balance sheet, 10 employees) may file simplified accounts with only a balance sheet. For all sizes, accounts must be approved by the board of directors and signed by a named director before filing. From 1 April 2026, all accounts must be filed using HMRC and Companies House-approved digital software in iXBRL format. The old WebFiling route is no longer available.
1Office UK prepares and files annual accounts for UK limited companies. Standalone service available, no need to switch your bookkeeping.
Corporation Tax return: what UK companies owe and when
UK limited companies pay Corporation Tax on their taxable profits. The Corporation Tax return (form CT600) reports the company's income, allowable deductions, and the tax calculation to HMRC. Since 1 April 2023, the UK Corporation Tax regime operates on a two-tier rate structure.
UK Corporation Tax rates 2026
| Profit level | Rate | Notes |
|---|---|---|
| Up to £50,000 | 19% | Small profits rate. Applies to the majority of early-stage and small UK companies. |
| £50,001 to £250,000 | Marginal rate | Effective rate between 19% and 25%, calculated using marginal relief. A tax accountant calculates this correctly. |
| Above £250,000 | 25% | Main rate. Applies to larger companies or groups of associated companies. |
What reduces your Corporation Tax bill
Several allowances and reliefs can reduce the amount of Corporation Tax your company pays. The Annual Investment Allowance (AIA) allows 100% first-year deduction on qualifying plant and machinery up to £1 million per year. R&D Tax Credits allow loss-making innovative companies to claim back up to 27p per £1 of qualifying development expenditure under the SME scheme. The Patent Box reduces the effective Corporation Tax rate on profits from patented inventions to 10%. Business expenses including salaries, rent, software, professional fees, and training costs are all deductible from taxable profit. A good accounting service will ensure these reliefs are correctly claimed. They are among the most underutilised parts of the UK tax system for small companies.
VAT returns and VAT accounting for UK limited companies
VAT (Value Added Tax) is a separate obligation from Corporation Tax and operates on a completely different cycle. Registration is mandatory once taxable turnover exceeds £90,000 in any rolling 12-month period. Once registered, the company charges VAT on its sales, reclaims VAT on qualifying business purchases, and files quarterly VAT returns with HMRC.
When voluntary VAT registration makes sense
Registering for VAT voluntarily before the £90,000 threshold is often the right choice if your clients are VAT-registered businesses (they reclaim the VAT you charge, so it is cost-neutral for them), you have significant VAT-bearing costs such as equipment, software licences, or professional services that you want to reclaim, or your professional credibility benefits from having a VAT registration number. The downside of voluntary registration is the additional administrative burden of quarterly returns. This is precisely why outsourcing VAT accounting to a service like 1Office makes practical sense: the returns are handled, and the reclaim opportunity is not missed.
Making Tax Digital for VAT
All VAT-registered businesses in the UK must file their VAT returns using MTD-compatible software and keep digital records. This has applied since April 2022 and is now fully established. Manual VAT returns through the old HMRC portal are no longer permitted. If your current bookkeeping arrangement does not use MTD-compatible software, it is not legally compliant. 1Office UK uses MTD-compatible cloud accounting software for all VAT-registered clients and files returns directly with HMRC through the software integration.
1Office UK handles VAT registration with HMRC and all quarterly VAT returns as part of accounting packages.
Payroll and employer obligations for UK companies
If your UK limited company pays salaries to a director or employs staff, employer obligations apply from the first payment. UK payroll involves Real Time Information (RTI) reporting to HMRC, which requires a Full Payment Submission (FPS) to be filed with HMRC on or before each pay day. There is no option to batch payroll submissions quarterly or annually, every payment requires a same-day or prior submission.
Employer National Insurance and PAYE
Employers must deduct Income Tax and employee National Insurance from salaries under the PAYE (Pay As You Earn) system and paying these to HMRC by the 22nd of each month (or 19th if paying by post, which is strongly discouraged). Employers also pay Employer's National Insurance Contributions at 15% on earnings above the secondary threshold (£5,000 per year from April 2025, following the Autumn Budget 2024 changes). The Employment Allowance reduces the Employer NI bill by up to £10,500 per year for eligible companies.
Director salary planning
A common and legitimate approach for UK limited company directors is to take a low salary (often set at the NI Lower Earnings Limit to preserve state benefit entitlements, combined with dividends from company profits. This reduces the overall employer and employee NI bill, whilst remaining fully compliant with HMRC rules. The optimal salary-dividend split depends on individual circumstances and should be reviewed annually by an accountant as rates and thresholds change. 1Office UK's accounting service includes director remuneration planning as standard.
Making Tax Digital: what UK companies need to know in 2026
Making Tax Digital (MTD) is HMRC's programme to move all tax reporting to digital systems. Understanding where MTD currently applies is important for any UK limited company owner.
- MTD for VAT, already mandatory for all VAT-registered businesses since April 2022. Digital records and software-based filing are required. Non-compliance is a penalty risk.
- MTD for Income Tax Self Assessment (ITSA), applies from April 2026 for self-employed individuals and landlords with income above £50,000. From April 2027, the threshold drops to £30,000. This affects directors who also have self-employment income outside their limited company.
- MTD for Corporation Tax, currently in a voluntary testing phase. A firm date for mandatory MTD for CT has not yet been confirmed by HMRC, though the direction of travel is clear. Companies using cloud accounting software from day one will be well-positioned when MTD for CT becomes mandatory.
- iXBRL accounts filing. From 1 April 2026, all annual accounts submitted to Companies House must be filed in iXBRL format using approved software. The old WebFiling route is closed. This is not optional and affects every UK limited company regardless of size.
What this means if you currently file manually
If you or your previous accountant have been using the Companies House WebFiling portal or filing paper Corporation Tax returns, those routes are now closed or closing. Every active UK limited company needs cloud-based accounting software that supports iXBRL filing. 1Office UK uses HMRC and Companies House-approved software for all client filings.
Virtual business address and registered office for UK companies
Every UK limited company must have a registered office address at a physical UK location. This address is publicly visible on the Companies House register and is used for all official correspondence from Companies House and HMRC. A virtual business address is the standard solution for directors who work from home, are not UK-based, or simply want to keep their personal address off the public register.
What a London business address provides
- A compliant registered office address, satisfying the Companies House requirement for a physical UK address. All official post is received, scanned, and forwarded digitally.
- Director's service address. This is a separate, publicly-visible address for the director. Using a virtual address means neither your home address nor any other personal address appears on the public register.
- Professional credibility. A central London business address on your invoices, website, and Companies House listing signals an established UK presence to clients and counterparties.
- Privacy protection, Companies House is a fully public register. Anyone can search for your company and see the registered address. A virtual address keeps personal information private.
1Office UK provides a London registered office address and director's service address as part of all formation packages and as a standalone service for companies already incorporated. View the virtual business address service.
Registered office vs correspondence address
Since October 2023, Companies House requires a registered office address to be an "appropriate address" where documents can be physically delivered and acknowledged. A PO box is no longer sufficient as a registered office. A virtual office address from 1Office satisfies this requirement. It is a physical staffed location where post is received and processed.
What 1Office UK accounting services include
1Office UK is a registered Authorised Corporate Service Provider (ACSP) listed on the official GOV.UK register. The accounting service is designed for UK limited company owners who want complete compliance handled professionally without needing to manage multiple providers for different obligations.
-
1
Monthly bookkeeping
All income and expenditure recorded, bank accounts reconciled, and management accounts produced each month. Cloud-based using MTD-compatible software, accessible through the my1Office platform in English.
-
2
Quarterly VAT returns
VAT return preparation and MTD-compliant submission to HMRC each quarter. VAT registration handled where required. Input VAT reclaim optimised.
-
3
Payroll processing
Monthly payroll calculations, payslips, RTI Full Payment Submissions to HMRC on or before each pay day, and employer NI calculations. Director salary planning included.
-
4
Annual accounts preparation and Companies House filing
Statutory accounts prepared to UK accounting standards, filed with Companies House in iXBRL format via approved software, within the 9-month deadline.
-
5
Corporation Tax return (CT600) filing with HMRC
Corporation Tax return prepared and submitted to HMRC, with all available reliefs and allowances identified and applied. Tax liability calculated accurately. Filed within the 12-month deadline.
-
6
Confirmation Statement and Companies House filings
Annual Confirmation Statement filed on time. Any changes to directors, shareholders, or company details filed with Companies House within statutory deadlines.
Professional accounting for your UK limited company
Annual accounts. Corporation Tax. VAT returns. Payroll. Bookkeeping. All handled by a registered ACSP with Companies House.
Questions? Email uk@1office.co or call +44 20 3868 9958Frequently asked questions about accounting services in the UK
What accounting services does a UK limited company need?
A UK limited company needs annual accounts filed with Companies House, a Corporation Tax return filed with HMRC, a Confirmation Statement filed annually, and quarterly VAT returns if VAT-registered. Monthly bookkeeping and payroll processing are also required for active trading companies. 1Office UK provides all of these as part of its accounting packages from £99 per month.
How much do accounting services cost for a UK limited company?
1Office UK accounting packages start from £99 per month and include monthly bookkeeping, VAT return preparation, annual accounts, and Corporation Tax return filing. The cost varies depending on the company's turnover, number of transactions, and whether payroll is required. A standalone annual accounts and CT600 service is also available for companies whose day-to-day bookkeeping is handled elsewhere.
When must a UK limited company file its annual accounts?
Annual accounts must be filed with Companies House within 9 months of the company's accounting reference date. For a company with a 31 December year end, accounts are due by 30 September. First accounts are due 21 months after incorporation. Late filing attracts automatic penalties starting at £150 for accounts up to one month late, rising to £1,500 for accounts more than 6 months late, with amounts doubled in consecutive years.
What is the difference between annual accounts and a Corporation Tax return?
Annual accounts are the statutory financial statements (balance sheet, profit and loss account, and notes) filed publicly with Companies House. The Corporation Tax return (CT600) is a separate document filed privately with HMRC that calculates and reports the company's tax liability. Both are required annually, both are prepared from the same underlying bookkeeping, but they go to different government bodies and have different deadlines.
Do I need a London business address for my UK company?
Every UK limited company must have a registered office address at a physical UK address. If you work from home, are based outside the UK, or simply want to keep your personal address off the public Companies House register, a virtual business address from 1Office UK satisfies this legal requirement. A London registered address is included in all 1Office UK formation packages and is available as a standalone service.
What is Making Tax Digital and does it apply to my company?
Making Tax Digital (MTD) is HMRC's programme to digitise tax reporting. MTD for VAT is already mandatory for all VAT-registered businesses. MTD for Income Tax applies from April 2026 for self-employed individuals with income above £50,000. MTD for Corporation Tax is in a testing phase with no confirmed mandatory start date yet. All 1Office UK accounting services use MTD-compatible software, so clients are compliant now and future-proofed as further MTD obligations are introduced.
Can I get accounting services for my UK company if I am not based in the UK?
Yes. 1Office UK provides accounting services to company owners based anywhere in the world. All services are delivered remotely through the my1Office platform in English. You do not need to visit the UK, post physical documents, or use a local accountant. 1Office is a registered Authorised Corporate Service Provider with Companies House and serves clients from over 80 countries.
What are bookkeeping services and why does my company need them?
Bookkeeping services involve the ongoing recording of all your company's financial transactions: income, expenses, bank reconciliations, invoicing, and expense management. Without accurate bookkeeping maintained throughout the year, annual accounts cannot be prepared correctly, VAT returns are inaccurate, and tax bills may be wrong. Monthly bookkeeping from 1Office means your accounts are always ready for year end, VAT returns are prepared from live data, and you have real-time visibility of your company's finances.
