Corporation Tax

Corporation Tax is a tax on the profits of limited companies and some other organisations such as clubs, societies and associations.

Companies pay corporation tax on both their profits and their gains. If you carry on a business through a company, you must tell HMRC, keep records, file a Company Tax Return, and pay the right amount of corporation tax at the right time.

If you have employees, then you will need to register the company as an employer (see section on being a employer)  If you work for your own limited company then you will be an employee and normally a director of your company (see section on being an company director)

You may also need to register for VAT (see VAT section for details)

To see a list of current and recent corporation tax rates on the HMRC website, click on this link: http://www.hmrc.gov.uk/rates/corp.htm

Help and advice

At TaxAid our remit is to help those on low income who cannot afford to pay for professional help. Normally people who have their own limited company will be outside our remit.

You can ask an accountant or tax adviser to act for your company as regards corporation tax and other matters connected with HMRC. There is advice on how to do this on the HMRC website at http://www.hmrc.gov.uk/ct/managing/appoint-agent.htm.

HMRC provides free workshops about setting up a limited company and will be useful of if you are about to, or have recently set up a limited company. The workshops cover such matters as how to form a private limited company; your obligations to Companies House and HMRC; VAT obligations and HMRC online services for companies. You can find out more at http://www.hmrc.gov.uk/bst/advice-team-events/work1.htm (go to the bottom of the page and follow the link to book).

For more information about corporation tax and about limited companies, please see:

The HMRC website corporation tax section – http://www.hmrc.gov.uk/ct/index.htm

Companies House website http://www.companieshouse.gov.uk/index.shtml

Business Link – Starting up – http://www.businesslink.gov.uk/startingup