Corporation Tax

Corporation Tax

One of the main duties of the company’s director or directors is to ensure that all of its tax affairs are dealt with in good order which of course includes accurate and timely Corporation tax submissions to HM Revenue & Customs (HMRC) as well as payments within the deadline.

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Introduction

Part of the considerations when setting up a UK limited company is to recognise that you will have to pay a percentage of your annual profits as Corporation Tax. This tax can also apply to many different kinds of organisations such as housing associations, private members’ clubs and associations and trade associations. Corporation Tax can represent a significant amount of your trading costs, so it really is essential that you pay the correct amount.

Corporation Tax Returns.

Many limited companies have felt the ‘wrath’ of HMRC when they fell behind on their Corporation tax payments. HMRC actually closed down over four thousand businesses in 2018 because of this very problem. For a limited company, VAT payments and Corporation tax become payable to HMRC on invoices which have been issued, rather than on the money being received.

The increasing tendency of a company’s clients to pay their bills as late as possible, leaving payment to the last possible moment has made this problem more acute.

There will always be tricky times for businesses, and they need intelligent solutions to help them through.  

Our team of professional accountants have a range of services which will deal with all of your Corporation tax administration and make sure you minimise your liabilities and maximise your benefits.

Ensuring Corporation Tax Compliance.

We have a comprehensive range of services specifically designed to ensure your company meets all of its tax compliance requirements.

Filing on time

There are various deadlines for filing Corporation Tax returns, depending on your accounting year, and consequent penalties for lateness or error. The Corporation tax submission can go in at any point between the end of your financial year and the statutory filing date as specified by HMRC. For example, if you have set your accounting end of the year as of December 31st, you must pay your Corporation tax by October 1st in the following year. The usual deadline would be no later than twelve months after your year-end, or it could be three months after you have received a notice to send your completed tax return.

However, should your company have been successful enough to make a taxable profit of up to £1.5 million, you must pay your Corporation tax no later than nine months plus one day after your accounting year-end.

Avoiding harsh penalties

If your Corporation tax return goes in late, or if any of the information is inaccurate, your business will incur a financial penalty. Late filing will result in you receiving an instant fine, and if you don’t pay it straight away, it will incur interest. In addition, if you are a persistent offender who has sent late returns on several occasions, you may well incur increased penalties which can cost you thousands of pounds.

We will work closely with you to ensure all relevant data is collected smoothly and efficiently and that all tax calculations are accurate.

Corporation Tax assessments

We will prepare and submit all the annual corporation tax documentation. This can be quite a challenge for busy directors as the submission can run up to 12 pages and require having hundreds of financial figures. Knowing which sections are relevant to your company is also essential.

Minimising your Corporation Tax.

Minimising your tax bill is the priority for most businesses, and there are many ways our team can help to ensure you receive the full advantage of any corporation tax reliefs and opportunities.

Expenses

It’s quite easy to miss out on claiming for eligible expenses. We frequently come across Directors who have incurred business expenses but forgotten to log them. We are experts in understanding which allowable expenses are tax-deductible to help you save money, ranging from stationery to staff uniforms with company branding. We know what expenses you are entitled to claim and can help you keep track of them.

You do have to be careful about what you are claiming, which is where our expertise comes in.

Dispute Arbitration

We can save you hours of precious time and therefore money by acting on your behalf to liaise with HMRC resolving any issues which might arise.  

Research and Development

If you are employing staff to solve technical problems or come up with a new, improved or innovative product or service, you may well be eligible for a generous reduction in the amount of Corporation Tax you are paying. This might also be the case if you have bought specialist research equipment or spent money on creating facilities for research.

Annual Investment Allowance

If you invest in certain business assets which can be classed as plant and machinery, you may be eligible to claim tax relief up to a specific limit. The rate of Annual Investment Allowance went up to £1m in January 2019, so if you bought any of these items after that date, you could claim a significant amount of that investment back.  

Training for your staff

As long as any training and development have a direct relation to the company’s activities, any costs incurred can be tax-deductible.  

There are several more ways to minimise your Corporation tax liability, including allowances for working from home, business mileage and even the cost of Staff Parties!

With our in-depth knowledge and experience, our team has the insight to help your business manage its tax, taking into account complex changes in the UK and global tax legislation.

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"The financial success of every business is dependent upon an effective and insightful understanding of their current standing."

— Julie Cameron, Managing Director of Suretax