How to Reduce Your HMRC Corporation Tax
by Vidit Agarwal Marketing DirectorIf you ask
any of the accountants about their
concept of paying taxes, they would say that it is the right thing to do; and
sure, it is. Since HMRC Corporation Tax is paid against your profit, if enough can be taken, you
can make sure that you are not paying anything more than you actually have to.
It is not about reducing the tax you need to pay; rather, it is ensuring that
you only pay what you must.
It is in
this scope that you can follow the below-given tips to reduce the amount of the
tax payable.
Claim all the expenses you can: Since the Corporation
Tax is levied against the profit you make, if the expenses are more, the tax
amount would certainly be lower. In this regard, you need to ensure that all your
expenses have been claimed and none of it is left out.It might be a little
awkward to keep the account of£3 bus ticket and £2 note-pads, but remember they
add up together to a bigger amount in a year. It must be kept in mind that whatever
you add must be wholly for business purposes.
Paying yourself: Even if your consultant did not
remind you that you and your limited company are two different entities in the
eyes of the law, have this in your mind all the time. Hence, pay yourself. So
that the tax your business needs to pay naturally comes down. Since salaries are
business expenses, it is deducted to arrive at the profit, naturally.
Shopping for your business: The most tax-efficient and best way
to buy a computer or a phone for your business is to buy them through your business.
As you know, this can reduce the tax you need to pay as the profit would
normally come down. You can also take advantage of the provision by the
government under the name Government’s Annual Investment Allowance.
Pay your HMRC Corporation Tax in
advance to get interested: There are also options where you can, if possible, pay your tax in advance
to the office upon which the HMRC will pay you interests. This works in such a
way that the tax you paid will be given back to you, ultimately lowering the
tax you paid.
Paying
enough attention to these factors can help you ensure that you only pay the tax
owed by you. It must be kept in mind that an efficient accounting system in
place with any of the professional accountants to oversee the same can help you reduce
the tax payable.
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Created on Dec 23rd 2021 05:51. Viewed 154 times.