Company Tax Planning and Advice

In our democratic society, most profit making businesses have to pay taxes.

The way these company taxes operate has become more complex over recent years and good tax planning can save you considerable money in the long run, thus helping you to achieve your business aims sooner.

There are several major taxes that are likely to affect your business and the interaction, between these taxes is important.

We aim to plan your business in such a way so as to minimise your tax liability, such strategy requires regular review since your business and circumstances change over time as do the tax laws.

Corporation Tax – This is the tax which a limited company will pay on its profits. There is a requirement to submit a tax return annually to the Inland Revenue. We prepare your return and calculate your tax liability at the same time as preparing your statutory accounts.

Income Tax – An individual will pay income tax on the profit of their sole trader business or on their share of the profit of a partnership. We prepare the business element of your tax return and calculate your tax liability at the same time as preparing your annual accounts.

VAT – Businesses that make taxable supplies (most businesses) whose turnover is over the VAT threshold are required to register for VAT and account for this on a quarterly basis to HM Revenue and Customs. There are several options on how to account for your VAT, let us assist you in finding the option that is most suited to your business. We can also prepare your VAT returns for you through our bookkeeping department.

Capital Gains Tax – Generally this tax arises when an asset that is chargeable to tax is sold (but it can arise on other occasions). If it is a limited company asset it will be chargeable to corporation tax and dealt with through the Corporation Tax Return. If it is a personally owned asset it is subject to Capital Gains Tax and is dealt with through your personal tax return. Although Capital Gains Tax for most people only occurs occasionally, when it does it can be a lot of money. Planning is crucial in this area, with the best time to plan for a capital gain being prior to acquiring an asset in the first place.

Inheritance Tax – “There are two certain things in life, death and taxes”. We cannot do much about the first but can the second. The last tax to affect you in your life may well be inheritance tax. This tax is seen as very unfair since it is tax on people’s assets on death; it occurs at a particularly stressful time and often results in some assets having to be sold in order to pay the tax. It can be limited or avoided altogether often with some simple planning steps.

National Insurance – This is often seen as a hidden tax, probably because it not called tax. Over the last few years National Insurance has increased and most people who pay income tax on either employment through PAYE or Self Employment will pay National Insurance. The recent increases in National Insurance rates effectively amount to a rise in the rate of tax. National Insurance is probably the key taxation factor for small businesses in deciding what structure their business will take. We can advise on this for business start ups and for growing businesses.