While everyone is aware that tax is a charge imposed by HMRC on income earned in the United Kingdom, understanding the tax consequences of different company sectors in the UK, reporting your income tax, and staying on top of deadlines all at the same time may be incredibly difficult.
Regardless of your existing tax situation, the correct support and tax guidance can help you identify the tax risks you and your company face. Tax services address the need for individualized assistance in all tax-related problems, from filing clients’ personal tax returns to paying corporation tax on their company’s revenues.
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What is Corporation Tax?
Businesses in the United Kingdom pay corporation tax, which is based on their annual profits in the same manner that people pay income tax. Since April 2016, the corporation tax rate has been 19 percent for all limited enterprises. Previously, the rate was determined by the company’s profits.
Companies, unlike individuals, do not receive any type of tax-free allowance, hence all profits are taxable. There are, however, a variety of charges and deductions that you can claim to lower your bill. You must file a corporate tax return (CT600 form) with HMRC once a year to pay.
How to reduce your Corporation Tax Bill
1). Claim all Allowable Expenses
All companies can deduct the cost for expenses that have been incurred for an activity, good, or service. This can include meeting rail tickets, office equipment, petty cash for tea and biscuits, and other items unique to your industry. Salaries and employer National Insurance contributions are additional business expenses that can be deducted from taxable profits if you have employees.
2). Pay Yourself a Salary
Even if you’re the sole person employed by the company, the earnings are not yours. As a result, you can pay yourself a salary. Your wage, like that of any other employee, is a business expense, as are any National Insurance contributions made on your behalf by the company. By paying yourself, you can lower the company’s taxable profits.
3). Make an Earlier Payment to HMRC
Fortune favors the organized when it comes to business tax. If you pay your tax bill early, HMRC will refund you a portion of it as interest at a rate of 0.5%. Interest is normally paid by HMRC from the time you pay your corporation tax until the payment deadline. However, it will begin paying interest six months and thirteen days after the start of your accounting period.
Top 10 Corporation Tax Companies in the UK
1). Sterlinx Global is a leading and reliable accountancy firm that provides a range of services for SMEs and start-ups across a range of industries including e-commerce. They provide an affordable service for entrepreneurs in the retail sector and can help with VAT registration, reporting. They have helped a range of clients with tax issues and are well ranked by traders on top e-commerce websites. They have a strong grasp of both tax policy in selected EU countries and the UK.
2). Lite Tax: are Bristol Certified Accountants and Xero Gold Partners with a focus on small and medium businesses. Lite Tax is a major tax accountancy practice in Bristol, Nailsea, Portishead, and the surrounding areas.
3). Grant Thornton: Grant Thornton is a global network of independent accounting and consulting member firms that provide assurance, tax, and advisory services to privately held enterprises and governmental entities.
4). Moore Kingston Smith LLP: Moore Kingston Smith LLP was founded in 1923 and specializes in accounting and business consulting. Payroll processing, bookkeeping, financial accounting, and tax preparation are among the services provided by the London-based team of approximately 500 people.
5). Clear House Accountants: Our expert tax accountants help you through the tax compliance standards specified by HMRC, the major UK tax authority, and provide inventive and customized solutions to your difficult tax concerns. They don’t just provide tax compliance services; they equally include various approaches and strategies to help you lower your overall tax liability.
6). Tax & Advice: Tax & Advice is a London-based bookkeeping service with around ten members. They’ve been providing tax preparation, payroll processing, and bookkeeping services to a variety of clientele since 2010.
7). Salient Accounting & Finance: Salient Accounting and Finance is a team of more than 50 people situated in Basildon, England. This accounting firm, which was founded in 2008, specializes in financial accounting, tax preparation, and payroll processing for small enterprises.
8). HSKS Greenhalgh: Chartered Accountants in Nottingham, Derby & Uttoxeter providing tax advice, accounts preparation, estate planning, payroll, and corporate finance services
9). Azets: Azets UK is a specialist local accountant and business advisory group providing audit, payroll, corporate finance, tax and banking, and finance services
10). J&P Accountants: Chartered accountants in Manchester who specialize in e-commerce VAT Solutions, Tax Compliance, Business Consultancy, and Accountancy Solutions
Tax services provide individualized assistance in all tax-related matters, from filing clients’ personal tax returns to paying corporation tax on a company’s profits.
If you don’t pay your tax on time, you’ll have to pay interest on the amount you owe, as well as a penalty or fee. HMRC has the authority to take legal action to reclaim any money owed to them.
HMRC may impose fines if your company’s tax return is determined to be erroneous. The amount you must pay is determined by whether HMRC feels the error was intentional, whether you attempted to conceal it, and if you willingly admit to it before HMRC discovers it.
Even if you don’t owe any corporation tax, you’ll need to file a company tax return. Unless you complete the ‘nil to pay’ form, you will receive payment reminders from HMRC when your payment is due. You can alternatively return the payslip with the words ‘NIL due’ written on the HMRC reminder.