Most CT600 mistakes are not exotic, they are small, avoidable slips that either get a return rejected on the spot or, worse, get accepted and sit quietly wrong until an enquiry finds them years later. Here are the ones we see most often, and how to catch each one before you file.
1. Getting marginal relief wrong
Since April 2023, profits between £50,000 and £250,000 are taxed at 25% less a sliding-scale "marginal relief", using HMRC's standard fraction. Two details catch people out: the £50,000/£250,000 thresholds are divided by the number of associated companies (broadly, other companies under common control), and they are pro-rated if the accounting period is shorter than 12 months. Applying the headline thresholds unadjusted, in either direction, produces the wrong tax figure, sometimes by a meaningful amount.
2. Filing before the balance sheet actually balances
Net assets should always equal share capital plus retained earnings. A mismatch usually means a figure was mistyped, a rounding error crept in, or the previous period's closing position was not carried forward correctly. It sounds basic, but it is the single most common thing good filing software catches, precisely because it is also the easiest thing to miss when you are the one who typed every number in.
3. Retained earnings not reconciling to the prior period
This period's opening retained earnings should equal last period's closing figure, adjusted for this period's profit after tax and any dividends paid. If it does not reconcile, either a figure from last year was transcribed wrong, or something has changed that has not been accounted for. Catching this early avoids a much harder conversation with HMRC later about which year's figures are actually correct.
4. Missing the amendment window
If you spot an error after filing, you generally have 12 months from the filing deadline itself, so around 24 months after the accounting period ends, to submit a straightforward amendment. Miss that window and correcting the error becomes a formal overpayment relief claim instead, which is slower, needs more evidence, and is not guaranteed to succeed. If you think something might be wrong, act well before the window closes, not after.
5. Assuming all capital allowances software can file are actually filed correctly
Annual Investment Allowance and other capital allowances are usually calculated correctly by most software, the arithmetic is not the hard part. The hard part, for smaller filing tools especially, is that HMRC's tax computation format has strict, dimensional tagging rules for certain figures that some products have not fully solved. A claim that calculates correctly but is tagged incorrectly can be rejected by HMRC's gateway, or in the worst case, accepted with the wrong figure attached to it. If your return includes anything beyond the basics, it is worth confirming with your software provider that the specific claim type is actually supported for filing, not just for calculation.
6. Treating dividend income as taxable when it is not (or vice versa)
Dividends a UK company receives from another company are, in the great majority of ordinary cases, exempt from corporation tax, this is one of the more counter-intuitive rules for directors used to thinking of dividends as taxable income. The exemption has anti-avoidance carve-outs for certain arrangements, so if your dividend income is anything other than routine (overseas dividends, for example), it is worth checking rather than assuming either way.
7. Forgetting associated companies entirely
If your company is under common control with one or more other companies, even dormant ones, the small-profits and upper thresholds for marginal relief are divided between them. A single director with two active trading companies, or one trading company and a dormant property-holding company, needs to account for this, and it is very easy to overlook if nobody flags it.
8. Confusing the payment deadline with the filing deadline
These are different dates. Corporation tax is normally due for payment 9 months and 1 day after the end of the accounting period, while the CT600 return itself is not due until 12 months after the period end. Paying on time but filing late (or the reverse) both carry separate, distinct consequences, so it is worth diarising both dates individually rather than treating "corporation tax" as a single deadline.
Frequently asked questions
How long do I have to amend a CT600 after filing?
Generally 12 months after the filing deadline (so around 24 months after the accounting period ends). After that, correcting an error usually needs a formal overpayment relief claim instead.
What is the most common CT600 calculation error?
Getting marginal relief wrong, either missing it entirely or not adjusting the thresholds for associated companies or a short accounting period.
Do I need to pay tax on dividends my company receives?
In most ordinary cases, no. There are anti-avoidance exceptions for certain arrangements, so check if the dividend income is anything other than routine.