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Posts Tagged ‘Taxation’

New tax law is bad news for retiring company owners

Monday, March 19th, 2012

Since 1985, company owners looking to wind down a solvent business at the end of their working lives have been able to pay capital gains tax, rather than income tax on any surplus funds – by simply writing to Companies House asking officials to strike the business off its register.

Amid current concerns about tax avoidance, the UK Government has been making various endeavours to replace informal tax concessions.  Therefore from 1 March this year, companies with reserves of more than £25,000 will have to enter formal liquidation proceedings in order to have their surplus funds taxed at the lower capital gains rate (which is currently 18%).  This could cost each owner an additional £3,000.

The Financial Times has recently reported that accountants and policy advisors at business lobbying groups agree this new tax law will create an unnecessary burden on retiring entrepreneurs.  While criticising it as being “a tax on success” and “a hidden cost of retirement”, commentators also argue that it undermines the Government’s efforts to encourage the rise in entrepreneurship in the UK.

Corporation Tax – Need to Know Facts

Tuesday, February 14th, 2012

For taxes such as Income Tax and VAT the filing and payment deadlines are identical – but the deadline to pay your Corporation Tax (the “normal due date”) is before the deadline to file your Company Tax Return.

  • The “normal due date” is 9 months after the end of your Corporation Tax accounting period.
  • If your taxable profits are £1.5 million or less, you must pay your Corporation Tax by the normal due date.  (For example, if your company’s accounting period ends on 31 May, your Corporation Tax payment is due on or before 1 March the following year.)
  • If your taxable profits are more than £1.5 million, however, your Corporation Tax for that period should be paid in instalments, all of which are due before the deadline to file your Company Tax Return.
  • All companies and organisations must pay their Corporation Tax electronically.
  • If you do not pay your Corporation Tax on time, your business will be charged interest on what you owe.

The deadline for filing your Company Tax Return is 12 months after the end of your Corporation Tax accounting period.

Lord Davies, the 2010 Budget and female entrepreneurs

Friday, March 26th, 2010

Lord Davies, minister for trade, investment and small business, has claimed that the UK would have three-quarters of a million more companies if women became fully engaged with the business world. The 2010 Budget appears to have done nothing towards furthering that objective which is disappointing.On the other hand,looking on the bright side, at least the legal framework for start-ups remains the same. So what do you say -lets show them and “get engaged with the business world”! Lets aim for a tax relief dedicated to female entrepreneurs by the next Budget!