LIMITED companies and most unincorporated associations such as sports clubs and cooperatives have to pay corporation tax.

This is a tax levied against the profits a company makes. It includes profits from:

• Trading

• Investments

• Income from renting out buildings or land

• Selling assets for more than they cost.

Companies based in the UK pay corporation tax on profits from both the UK and abroad. Foreign companies with a UK branch or office have to pay tax on the profits from their UK activities.

Companies and other business can claim a tax deduction for expenditure on plant and machinery.

Currently companies can claim a 100 per cent annual investment allowance tax allowance on qualifying plant and machinery up to an annual limit of £500,000 a year. This amount is set to fall to £25,000 after the end of 2015.

POINTS TO CONSIDER

1. The deadline for paying corporation tax is 9 months and 1 day after the end of the accounting period.

2. The deadline for filing a corporation tax return is 12 months after the accounting period ends.

3. Companies with profits of more than £1.5 million pay their tax in quarterly instalments.

4. You can file your annual accounts with Companies House and company tax return together if they cover the same period.

5. You can get more time to file your accounts if something beyond your control prevents you from sending your accounts and you contact Companies House before the filing deadline.

6. You can’t pay corporation tax by post. Ways to pay include online, over the phone, by direct debit or in person at a bank, building society or post office.

7. Let HMRC know if you don’t owe any corporation tax for an accounting period. Otherwise they will send payment reminders.

Contact us if you need any further information or advice regarding corporation tax.

Alistair Byrne - JWP Creers LLP