Company tax rates

Company tax rates

Find here Corporation Tax rates and allowances for UK companies.

UK Company tax rates: from 5th April 2020 non-resident companies of which the income is derived mainly from UK property have been subject to UK Corporation Tax in the same way as UK companies.

From 5th April 2020 non-resident companies of which the income is derived mainly from UK property have been subject to UK Corporation Tax in the same way as UK companies.

For companies with profits under £300,000 the Corporation Tax rate is 19%, but for companies with profits over £50,000 the rates of tax will change on 1st April 2023

Calculation of the taxable income broadly follows the rules for individuals except that:

  1. Transactions occurring outside the UK and relating to non-UK assets by a non-resident company are outside the scope of UK tax. UK resident companies are subject to Corporation Tax on income and gains wherever in the world they occur. The tax treaties may go some way to reducing the tax due if a transaction has been taxed overseas.
  2. Gains arising on disposals by companies are subject to Corporation Tax.
  3. The S24 loan interest relief restriction does not apply to companies.

UK Company tax rates: from 5th April 2020 non-resident companies of which the income is derived mainly from UK property have been subject to UK Corporation Tax in the same way as UK companies.

Note

  1. When a director/shareholder draws money from a UK company, there are only four types of withdrawal permitted:
    1. Repayment of a loan previously made to the company
    2. Reimbursement of expenses incurred on the business of the company
    3. Dividend
    4. Salary or bonus

      Dividend, salary, and bonuses are taxable in the hands of the recipient at the prevailing rates. While the salary or bonus may reduce the profit subject to Corporation Tax, a dividend does not. Salary and bonuses may be subject to National Insurance Contributionss. Payment of salary or bonus will require the creation of a PAYE scheme.
  2. A company does not enjoy the Personal Allowance for individuals, nor does it enjoy the annual exempt amount for Capital Gains Tax.
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