CTM03670 - Corporation Tax: small companies: procedures

Following the issue of SP1/91, a claim for small companies' relief should include a statement of the number (including nil) of companies associated with the claimant company in the relevant accounting period unless the case is an unincorporated association or other members' club or society. The CT Self Assessment return form (CT600) makes provision for claiming small companies' relief and for showing the number of associated companies.

You should make a detailed investigation of a company's entitlement to small companies’ relief only in conjunction with a full enquiry or where there is reason to suspect the existence of associated companies. A full enquiry will usually involve questions about associated companies whatever the level of profits but otherwise questions should only be asked where there is likely to be some worthwhile result. In view of the size of the limits (for example £300,000 and £1,500,000 for the financial year 2009), there is nothing to be gained from investigating entitlement in a case where profits as finally agreed for that year are below £75,000 unless there are three or more associated companies.