Corporation Tax
Companies are required to self-assess their own corporation tax
and pay the amount due within nine months and one day after
the end of their accounting period. An exception is made for large
companies, who are allowed to pay in instalments; large companies
are classified as those whose profits are £1.5 million or
more.
The provisions are broadly the same as those that
apply for income tax self assessment, except that companies do not
have the option of asking the Inland Revenue to work out the tax.
Since 1st April 2006, a starting rate (19%) of corporation tax has
been applied to companies with profits of £300,000 or less.
Marginal relief (rate of 23.75%) applies to companies with profits
between £300,001 and profits above £1,500,000 are taxed
at 30%.
Penalties and Interest
There is an automatic penalty of £100 where a corporation
tax return is not received by the Inland Revenue within 12 months
after the end of the accounting period. Interest is also charged
on unpaid corporation tax.
A £100 penalty can also be levied by Companies
House if the accounts are not received within 10 months after the
end of the accounting period. This penalty can increase to £1,000
if accounts are more than one year late. Do not risk being penalised
as it can cut into good profits; also, it can be avoided by using
Academy Accounting Ltd, where we can guarantee submitting your work
on time. Call us today on 0141 891 5999 to find out more information,
or e-mail us at enquiry@academyaccounting.co.uk.
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