2. Business Tax
We will ensure that your tax affairs are in order and your tax planning reflects the objectives of the business.
We can help to ensure that your business is paying the right amount of tax, while also taking advantage of available tax reliefs and allowances. Popular examples include R&D tax relief and capital allowances or SEIS/EIS planning when equity fundraising.
Tax legislation is always changing. We interpret changes and offer advice to ensure your business is positioned to benefit accordingly.
This requires the time and resources to understand and respond to complex tax legislation in an environment where HM Revenue & Customs’ review processes are becoming increasingly sophisticated.
Our experienced team can advise on remuneration strategies across your business and plan an effective profit extraction from the business.
Some of the other areas where we can help your business include:
- Deciding on a tax-efficient structure
- Making the most of allowances and reliefs
- Reducing tax on selling or winding down your business
- Maximising tax relief on acquisitions
- Liaising with HMRC on your behalf
- Assisting with compliance requirements, including corporation tax self-assessment and VAT
- R&D tax allowances
- Capital allowances
If you are a shareholder or director, we can also help to ensure that your personal wealth is managed as tax-efficiently as possible too.
Tax breaks! If your company purchases a new and unused electric car you get full tax relief in the year of purchase as it represents the most generous Capital Allowance saving (First Year Allowances or FYAs). For example, buying a £50,000 car will generate £9,500 worth of Corporation Tax savings. This compares very favourably to non-electric cars which receive only 6% (£570) or 18% (£1,710) relief in year one depending on their CO2 emissions.
In addition, the electric car with nil CO2 emissions can be utilised for your personal use and would only generate a small employment benefit in kind (being currently only 1% of the car’s list price).
Combined with the environmental benefits and the relatively low cost of electricity as compared to the standard fuels, if you’re considering purchasing a new car it’s definitely worth considering an electric one!
The deadline for filing your corporation tax return is within 12 months of the company’s accounting year-end date. Yearly filing typically includes the submission of the company tax return form and tax computation. If you fail to file the return on time the company will receive an automatic penalty. This applies even if no corporation tax is actually due.
Where corporation tax is due, the payment deadline will be typically within nine-months-and-a day of the company’s accounting year-end date. Other factors including the amount of taxable profit could put the company in a position where it is required to pay corporation tax on a quarterly instalment basis.
Are Research & Development (R&D) tax relief rates different for Small Medium Enterprises (SMEs) and Larger Businesses?
Yes, R&D tax rates differ depending on your company size. SMEs are classed as those with fewer than 500 employees and a turnover of under 100 million euros or a balance sheet total under 86 million euros.
SMEs can deduct an extra 130% of their qualifying costs from their yearly profit, as well as the normal 100% deduction, to make a total 230% deduction. If the company is loss making it can then ‘cash out’ a tax credit up to 14.5% of the surrenderable loss.
Large companies can claim a Research & Development Expenditure Credit (RDEC) for working on R&D projects. The RDEC is a tax credit and is currently 13% of the company’s qualifying R&D expenditure.
If you have any questions or need further advice in this area, please get in touch and we will be happy to discuss further.