As part of the process of setting up your new limited company, your company will be issued a Unique Taxpayer Reference (UTR) number by Her Majesty’s Revenue and Customs (HMRC). Your UTR number identifies your limited company when dealing with HMRC regarding any taxation matters. In this article we will explain all that you need to know about UTR numbers, including how to obtain your company’s UTR number, the key features of that number and what to do if you lose it.
Understanding the Concept of a Company UTR Number
A UTR is a unique 10-digit reference number provided by HMRC when a new company is registered. Some UTR numbers may also have the letter “K” at the end (e.g. 1234567891 K). UTR numbers let HMRC identify the right company for the purposes of Corporation Tax. UTRs are also issued to individuals who have registered for personal tax self-assessment. It is important to note that personal UTRs are completely different and separate from company UTRs. You cannot use your personal UTR to identify your limited company, nor can you use your company’s UTR to identify your personal tax affairs.
The Importance of a UTR Number for your Business
Your company’s UTR is important to your business for a number of key reasons. Specifically, UTR numbers:
- Ensure that, when you file your corporation tax returns and pay corporation taxes, the correct company records are referenced and updated.
- Ensure accurate tax filings, helping you avoid penalties and ensuring compliance with UK tax laws.
- Make it easier to communicate with HRMC if you need to have any tax-related issues.
- Make it easier to access securely your HMRC corporation tax records online.
- May be required by prospective lenders and suppliers to assess your company’s financial stability and creditworthiness.
For all of these reasons it is important to keep your limited company’s UTR details secure and yet also close to hand for whenever they are needed.
How to Obtain a Company UTR Number in the UK
When you form a new limited company, Companies House automatically notifies HRMC, which in turn issues your UTR number. You do not need to ask HMRC directly for a UTR number.
Within 10 days of your new company registration with Companies House, HMRC will send a letter to your registered office address with your new company UTR number and guidance on your tax responsibilities.
The Role of HMRC in Issuing Company UTR Numbers
HMRC plays a central role in issuing UTR numbers to companies in the United Kingdom. As explained above, whenever a new company is registered with Companies House, HMRC automatically generates a UTR number for that company. HMRC then uses the UTR number to monitor and collect various taxes such as corporation tax and VAT. UTR numbers facilitate efficient and accurate tax assessment, reducing the risk of errors and potential penalties.
Key Features of a Company UTR Number
Company UTR numbers have several key features that are essential for tax and financial management, including:
- Communication: UTR numbers ensure smooth and efficient communication between limited companies and HMRC. When you give your company’s UTR number to HMRC they can quickly access the correct tax record, ensuring that accurate information is provided.
- Lifetime Validity: Your company UTR number will remain valid for the lifetime of your company (i.e. from its date of registration with Companies House until its dissolution). UTRs therefore provide a firm basis for the accurate tracking of company tax over time.
- Record Keeping: Company UTR numbers make it easy to access current and historical tax records and information.
- Security: UTR numbers are shared only with authorised individuals, so are extremely secure. This is why it is important to keep your UTR details protected at all times.
- Stability and creditworthiness: Financial institutions, suppliers and government agencies often request a company’s UTR number to assess its financial stability and creditworthiness.
- Tax Identification: Company UTR numbers serve as a single reference for all matters relating to corporation tax. They are used for filing Corporation Tax returns and Value Added Tax (VAT) returns. They also help HMRC link any tax liabilities owing to the correct business.
- Uniqueness: Every company UTR number is completely unique to the company for which it is issued. This uniqueness ensures that no two businesses share the same identifier, thus reducing the chance of confusion or error when filing tax returns.
Common Misconceptions about Company UTR Numbers
There are several misconceptions about Company UTR numbers, leading to potential confusion among business owners and individuals. Here are some of the most common misunderstandings:
- Company UTR numbers are issued immediately: There is a misconception that UTR numbers are issued instantly following company registration. In reality, however, it can take up to three weeks for HMRC to process and issue the UTR by letter.
- Permanent UTR Numbers: It is a common misconception that UTR numbers never change. While this is true in most cases, a UTR may be changed as a result of alterations to company structure (e.g. from a limited company to a partnership).
- One UTR for all tax types: Another common misconception is that UTRs can be used for all types of tax. In practice, there are different UTRs for different taxes. For example, there is one UTR for Corporation Tax and a different UTR for personal Self-Assessment Tax.
How to Use your Company UTR Number Effectively
By using your UTR number effectively throughout the lifespan of your business you can ensure ongoing legal compliance with HMRC. We recommend that you keep your UTR secure and yet also easily accessible – but only by those who have a right to use it. It is also important to ensure that your company’s UTR is clearly shown on all official tax documents, e.g. HMRC tax returns and correspondence.
Furthermore, when communicating with HMRC it is always advisable to include your company UTR to ensure an efficient and correct response. If you own several companies then it is important to ensure that you use the correct UTR number for each company and that these are kept separate from your personal UTR number/s.
The Consequences of Misplacing your Company UTR Number
Losing your company’s UTR can cause a number of problems. Firstly, it may get in the way of meeting your company’s tax obligations accurately and on time. This, in turn, may result in HMRC fines and penalties for late or incorrect filings. Misplacing your company UTR may also hinder communication with HMRC, causing delays in resolving tax-related problems or queries.
Another reason not to misplace your company UTR is to avoid difficulties when applying for credit or engaging in financial transactions. This is because lenders and suppliers may request your company’s UTR when assessing your financial stability. To avoid these consequences it is crucial to keep your UTR stored securely but accessible when needed.
Tips for Safeguarding Your Company UTR Number
It is important to keep your UTR in a secure location, both in digital (password protected) and physical forms (e.g. in a locked drawer or cabinet). Your UTR should be accessible only to authorised personnel. Always avoid sharing your company’s UTR with other individuals and organisations, especially over the ‘phone. Never disclose your UTR in response to unsolicited e-mails (e.g. phishing attempts) or calls. Educate your employees on the overall importance of information security, privacy, and confidentiality and why it is important not to disclose your UTR without good reason. Where necessary, update your data protection policy to include this guidance.
It is also advisable to review your HMRC records on a regular basis for any signs of unusual activity which may be caused by the misuse of your UTR. If you spot any signs of misuse, report these to HMRC as quickly as possible.
Frequently Asked Questions about Company UTR Numbers
What should I do if I misplace a company UTR number?
Your company’s UTR will be printed on any previous tax returns and correspondence from HMRC. If you still cannot find it then you can ask for your company’s UTR online. To request your UTR you will need your company’s registered name and number. If the request is approved then your company UTR will be posted to your company’s registered address.
Do UK companies have a TIN number?
The term “TIN (Tax Identification Number) number” is seldom used in the United Kingdom. All companies that are registered in the UK are automatically assigned a Unique Taxpayer Reference (UTR). This type of TIN is a unique 10-digit number that is used for purposes of Corporation Tax.
A company’s UTR number is different and separate from its Company Registration Number (CRN), with which it should not be confused. A CRN is used to identify each company and verify its legal existence. It is issued by Companies House as soon as a company has been registered and is displayed on the Certificate of Incorporation and on the public register of companies.
Conclusion
Company UTR numbers provide a streamlined and efficient means of filing business tax returns, accessing corporation tax records, reducing errors, and eliminating fraud. At Uniwide Formations, we ensure that you receive your company UTR as part of the process of incorporating your new limited company. For more information on how to get your UTR number, please read our article.
