Making corrections after filing End of Year reports

This article explains which options are available if you need to make a correction in your accounts after you’ve filed either or both your Final Accounts and Corporation Tax return in FreeAgent.

FreeAgent’s End of Year report for a limited company includes a full set of accounts, a shortened version and Corporation Tax (CT600) return(s). Once you have finalised your company’s End of Year report by adding your signature, this places a lock on your accounts to prevent you from making any further changes. You can remove this lock to make changes to your accounts if you haven’t yet filed your Final Accounts or Corporation Tax return.

If you find that there are errors within your accounts after you’ve filed either or both your Final Accounts and Corporation Tax return, you can either unlock your End of Year report to make the corrections this year or make the corrections next year.

Please note that FreeAgent can’t advise which option you should choose and we would strongly recommend discussing the options with your accountant before deciding which is the best way forward for your business.

If you haven’t yet filed your Final Accounts or Corporation Tax return

If you haven’t yet filed either your Final Accounts or Corporation Tax return through FreeAgent, you can remove your signature from the End of Year report and make changes to your accounts. Please note that if you’ve manually marked your Final Accounts or Corporation Tax return (or both) as filed, you’ll need to mark these as unfiled before you can remove the signature.

Marking your manually filed Final Accounts and Corporation Tax return as unfiled

To mark your Final Accounts report as unfiled, navigate to the relevant Final Accounts report and select ‘Mark as unfiled’.

To mark your Corporation Tax return as unfiled, navigate to the relevant Corporation Tax return and select ‘Mark as unfiled’.

Then follow the steps below to remove your signature.

Removing your signature from your End of Year report

Navigate to the ‘Accounting’ tab at the top of the screen and select ‘End of Year’ from the drop-down menu.

Select ‘Remove signature’.

Select ‘OK’ in the pop-up window to complete the process.

You’ll now be able to make changes to your accounts and finalise your End of Year report again once you’ve made the relevant changes.

If you’re not planning to re-approve your End of Year report, we would advise you to add an account lock for the period that your End of Year covers, to prevent any future changes being made to this period.

If you’ve filed either or both your Final Accounts and Corporation Tax return

If you find that there are errors within your accounts after you’ve filed either or both your Final Accounts and Corporation Tax return, you can either make the corrections next year or unlock your End of Year report to make the corrections this year.

If you’re unsure which option is the best way forward for your business, please ask your accountant.

Make the corrections next year

If you’ve already filed either or both of your End of Year report for the relevant accounting year through FreeAgent, you can leave your accounts as they currently are. This will allow you to include any corrections for your current year’s accounts when you submit your Final Accounts and Corporation Tax return next year.

The FRS 105 reporting standard for micro entities states under 5.4: “An entity shall recognise all items of income and expense in a period in profit or loss unless an FRS requires or permits otherwise, or unless prohibited by the Act. For example, under this FRS, the effects of corrections of material errors and changes in accounting policies are presented as retrospective adjustments of prior periods rather than as part of profit or loss in the period in which they arise (see Section 8 Accounting Policies, Estimates and Errors).”

There’s also further guidance under 8.14 – 8.17 Corrections of prior period errors: “To the extent practicable, a micro-entity shall correct a material prior period error retrospectively in the first financial statements authorised for issue after its discovery.”

Unlock your End of Year report

Alternatively, you can unlock your Final Accounts report and Corporation Tax return if you’d prefer to fix the errors this year.

If you’ve already filed your original end of year accounts, you may need to submit amended accounts to include any changes. Please note that it’s not currently possible to file amended Final Accounts through FreeAgent, therefore you’ll need to file your amended accounts with Companies House directly if you make any changes to your Final Accounts. Please see this official guidance for more information.

If you choose to unlock your End of Year report, we would strongly advise that you save copies of all the relevant reports that might be needed before the filing confirmation is removed. This will provide you with a record of the reports outside of FreeAgent should you need to look back at how they were before the filing confirmation and account lock were removed, and any changes subsequently made.

Please see below for guidance on how to unlock your Final Accounts and Corporation Tax return in FreeAgent.

Unlocking your Final Accounts report

To unlock your Final Accounts, navigate to the relevant report and select ‘Unlock Accounts’. Please note that this will not 'un-file' the accounts with Companies House but will remove the record of it being filed from your FreeAgent account.

This will allow you to remove your signature from your End of Year report if your Corporation Tax is also unfiled, so you can make any necessary changes to your FreeAgent account.

Once the necessary changes have been made, you can manually mark your Final Accounts as filed in FreeAgent by navigating to the relevant report and selecting ‘Mark as filed’.

Unlocking your Corporation Tax return

To unlock your Corporation Tax return, navigate to the relevant return and select ‘Unlock Return’. Please note that this will not 'un-file' the CT600 with HMRC but will remove the record of it being filed from your FreeAgent account, as well as the submission receipt/IR mark.

Unlocking the return will allow you to remove your signature from your End of Year report if your Final Accounts are also unfiled, and amend your accounts.

FreeAgent will automatically mark the return as ‘amended’ when you unlock the return but you can also check this by selecting ‘Edit Details’ and making sure the ‘Are you making an amendment’ option is set to ‘yes’.

Once the necessary changes have been made, you would need to consider whether this would then require you to file an amended CT600 with HMRC to match your final accounts, otherwise you'd have two different sets of accounts on record, one with Companies House and the other with HMRC.

If you do need to file an amended CT600, you’ll have the option to re-file an amended CT600 through FreeAgent by selecting ‘File online with HMRC’.

If you don't need to file an amended CT600, you can manually mark your Corporation Tax return as filed in FreeAgent by navigating to the relevant report and selecting ‘Mark as filed’.