Corporation Tax Flashcards
When is a company classed as a resident of the UK?
A company is resident in the UK if it is incorporated in the UK, or it is ‘centrally managed and controlled in the UK.
- Resident companies pay corporation tax on their worldwide income and gain
- Non-resident companies are chargeable to UK corporation tax on profits of any permanent establishment in the UK
What basis is property income calculated for companies?
Property income in calculated on a accruals basis
For individuals it is calculated on a cash basis
How are dividends impacted by corporation tax?
Dividends are exempt from corporation tax
How are NTLR allocated in long periods of accounts (>12 months)?
On the accruals basis
How are chargeable gains allocated in long periods of accounts?
Date of disposal
How are QCDs allocated in long period of accounts?
On a PAID basis
What is the rate of corporation tax?
19%
Corporation tax return must be submitted by the latest of? (3)
1) 12 months after the end of the period of account (If period is < 18 months)
2) 30 months from the start of the period of account (If period is > 18 months)
3) 3 months from issue of notice to submit a return
What is persistent failure defined as?
3 consecutive late returns
Payment of corporation tax ? (2)
1) A company not classified as large must pay its corp tax by 9 months and 1 day after the end of the accounting period
2) A company that is classified as large must pay its corp tax in four installments by the 14th day of the 7th, 10th, 13th and 16th month.
What is the limit for a company to be classed as large?
1.5m
Adjusted as followed:
1) Scaled down if the POA is < 12 motnsh
2) Divided by the number of 51% related companies
Where corporation tax is payable by installments, how do you work out the first installment?
3 * CT/n
n = number of months in the accounting period
- Subsequent installments are paid the same way until the liability is paid
When is a company classed as Very large?
If its augmented profits exceed £20 million
When does a company classed as very large have to pay its corporation tax?
In four installments on the 14th day of the 3rd, 6th, 9th and 12th Month.
