Corporate Tax: What Do I Need to Plan For?

If you run a business, you will have to pay corporation tax on your profits annually, and this is paid on your net taxable profits.

But while it is something that all companies pay, it can also be complex and can take up a lot of time and resources in calculating what you need to set aside each month to cover the corporation tax bill. You will also want to look into ways to reduce corporate tax so you don’t pay more than you have to.

What’s more, tax investigations are strict, and if you make a mistake in these calculations it could turn out to be very costly.

So what do you have to plan for? Here are some of the most important areas to keep in mind.

Standard Corporate Tax Planning Areas

Standard Tax Issues: There are a number of routine tax matters that occur in a company’s corporation tax, PAYE, National Insurance, VAT and possibly CIS as well, all of which you will have to deal with.

Tax Structure: Working out the most tax effective structure for your business is of enormous importance. This is something you should do to minimise your exposure to corporation tax. Carrying out a complete tax review to work out the most appropriate tax structure for your business could lead to considerable savings.

Tax Relief: You will want to make sure you don’t overpay your corporation tax bill unnecessarily, otherwise you could be paying out of your profits and reducing your bottom line. For example, you want to ensure you get the maximum tax relief on acquisitions and disposals.

Self-Assessment: You will need to file your Self-Assessment with the authorities when submitting your tax returns. You must make sure these are filed on time and that they are accurate to avoid penalties.

Profit extraction planning: This is another area where it is not always as simple as taking a dividend and/or paying a salary.

Industry-Specific Tax Issues: There may be a number of tax opportunities that are specific to your industry.

How We Can Help

All of the above areas can prove to be complex even for small businesses. That’s why we will help you with all of them when it comes to your corporation tax planning. We will provide you with advice on all aspects of your corporate tax - with the benefit that we know exactly what you need to do in order to pay less tax.

We are also up to date with all of the changes that are brought in. A lot of changes have been proposed to corporation tax recently, and it’s our job to keep up with all of these to ensure you always pay the correct amount.

We highly recommend planning in advance. This can help you to reduce corporate tax by taking full advantage of tax breaks, and you can organise your business affairs more tax-efficiently.

In addition, we can reduce your administrative burden. One of the biggest issues with corporate tax planning is that its complexity means it can take up a lot of your time. We can do it all for you to take the pressure off and free up your team to work on other tasks.

We will also ensure you meet the demands of compliance, including submitting your Self-Assessment on time. Penalties can be stiff, which can take up even more resources and a lot of your time.

We can even act on your behalf in discussions should you be investigated by the authorities. Having professional accountants on your side can really help, and it can even lead to a more favourable settlement.

Improve Your Bottom Line

In short, more efficient tax planning can seriously improve your bottom line by helping you to reduce corporation tax and saving you time and resources. But you need to plan ahead and be proactive.

We can help you to minimise your exposure to corporation tax and cut down on the administrative work involved, so contact us to find out more.