Corporation Tax is the equivalent for a Limited Company to Income Tax for individuals. Payable by all UK based companies, it’s calculated according to the annual profits made, whether that comes from trading or from the sale of investments or assets, in the UK or abroad.

As with Self Assessment the onus is on the Company to tell HMRC how much it will pay, rather than HMRC to present a bill.

A company must:

• Register for Corporation Tax when it starts to trade.
• Keep sufficient accounting records that it may calculate accurately the correct amount of tax that must be paid, which is reported by submitting a Corporation Tax Return.

Deadlines for Corporation Tax at first appear a little backward!

Any tax must be paid nine months and one day after the end of the accounting period, while the Company Tax Return, which confirms the amount to be paid, is due for filing twelve months after the end of the accounting period.

We’ll usually prepare the Corporation Tax Return for clients at the same time as we prepare the Company Accounts, so the Accounting period is effectively ‘closed’ all at once. This helps the Directors plan for any resulting tax liability, as they’ll be forewarned in good time.

Any responsible business owner wants to ensure they’re paying the correct amount of tax, but no more than they need to!

In these articles, we’ve outlined some ways to keep your liability as low as possible, kept you up to date on changing legislation and explained what to do if you’re struggling to make your payment.

We’ll add more posts over time, as there are bound to be changes to come!

We hope you’ll find these posts helpful, but if you have any specific questions, please do get in touch.