Corporation Tax Flashcards
Give the proforma for TTP
Trading income + Property income + NTLR + Misc income + Chargeable gains= Total profit
Less QCD = taxable total profit
Misc income is given and chargeable gains is chargeable gains less capital loss
Remove CA from trading income
What is classed as NTLR
Interest rec is always NTLR
Interest paid is NTLR if investment purposes but if trade purpose then its part of trading income
What is the formula for NTLR
NT interest rec - NT interest payable
List 4 trading income rules
Full amount for cars including private use (if over 50 g/km add 15%)
Add depreciation
For gifts: must be below £50, not food/drink, must bear witness to be allowable
For wages: if accrued needs to be within 9 months of end of accounting period
What capital allowances are available for corporations?
Structure and buildings allowance on new trade related buildings (3%)
AIA of £1m incl on second hand goods
FYA (not avl to sole traders) on new unused items. Rate depends on which pool
- 100% on main pool but not cars
- Claim AIA first. Remaining cost x 50% (Special rate pool incl integral features)
What is a super-deduction for corporations and what is SSE
Between Apr 21 to 23 130% available for main pool assets. Upon disposal put 0 in capital allowance table but allowance as cost to purchase
Holding at least 10% of shares over 12 months continuously in 6 year period (No no loss)
Give timing rules in corp tax calculations for long periods(5)
- TATP
- Capital allowance- AIA and WDA if less than 12 months
- Property income time apportioned
- NTLR accruals basis
- Chargeable gains and QCD- date of disposal (calc which period)
How do you calculate corporation tax and what are the limits
Calc TTP, Calc Aug, Determine Rate
TTP is what is taxed. Aug gives rates.
Aug profits= TTP + Div from non associated co (below 50%)
Over £250,000= 25%
Less £50,000= 19%
When is marginal relief given and how is it calculated?
50,000<Aug<250,000
(Upper-Aug) x (TTP/aug) x (3/200)
time apportion upper limit
Corp tax at 25% - Marginal relief
What is the effective tax rate and how is it calculated?
It is used when aug profits = TTP (basically no div received). 26.5% is charged for over £50,000.
This should match marginal relief method
How do you treat associated companies for corp tax? How do you treat accrued QCD?
Divide the upper and lower limits by number of associate companies (ignore non associated). These are over 50% owning. Do not add div received to ttp to get aug
remove from total profits on cash paid basis to get ttp
Give key admin dates for corp tax
If 18 month period or less- submit within 12 months of end of period
over 18 months- within 30 months from start of period however 2 payments, 2 computation and 1 return
When are payments payable in installments? How is it calculated? When is it due
Large companies where profits exceed £1.5m
First payment is lower of:
3 x CT/number of months in AP
- and total CT for period
first- 14th day 7th month then every 3 months
final- 14th day 4th month after AP end (balancing)
