Corporation Tax
From April 2015 there has been a single rate of corporation tax for all companies- 20%. Corporation tax self-assessment requires companies to work out their own tax liability as part as their return and account for the ‘self-assessed’ liability to corporation tax.
Taxable profits are often reduces by employers making pension contributions. Self-invested personal pensions are popular with many company directors.
Another popular tax reduction strategy is to bring qualifying capital expenditure forward to take advantage of the 100% annual investment allowance. This was £500,000, although reduced to £200,000 from 1st January 2016.
Value Added Tax (VAT)
VAT is chargeable where taxable turnover is in excess of £82,000 in the previous 12 months or you expect this threshold will be exceeded within the next 30 days. There are schemes which simplify VAT accounting. These include the cash accounting scheme, annual accounting scheme and the flat rate scheme.
To plan for this be sure to remember;
– Would it be appropriate for you to use one of the special schemes?
– Are you accounting for VAT on the fuel used (on private motoring) using the appropriate scale charge.
-Make sure you don’t reclaim VAT on cars (unless you are a car dealer or taxi company, for example, or provide certain pool or leased cars for employees) or on entertaining UK customers.
For more advice or help on this call our Manchester offices to speak to a member of our team on 0800 020 9542 or email hello@JacRox.co.
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