Corporation tax is a business tax levied on the profits generated by limited companies registered within the UK. This isn’t a tax that applies to large businesses only and applies to all limited companies regardless of size.
What is Corporation Tax charged on?
The following provides a list of limited company outcomes that give rise to a corporation tax charge:
1. Trading profits
2. Investment returns
3. Gains on the sale of assets (chargeable gains)
If the limited company is based in the UK it will be charged corporation tax on profits derived within the UK and from overseas.
However, if the company is based overseas with an office or branch in the UK it will be charged corporation tax on profits generated within the UK only.
You must register your limited company for corporation tax within the first three months following the commencement of trading. The company may be issued a fine if this date is missed.
The current corporation tax rate is 19%.
If you need any further details relating to corporation tax then email one of our cheaper accountants.