Corporation tax (CT) is a tax payable each year on company profits; the rate of CT changes depending on the size of profits. The small company rate changes year to year but is roughly equivalent to basic rate income tax. This is why dividends are treated as if basic rate tax has already been paid for the shareholders who receive them.
Small companies owe their CT nine months and a day after the end of the “accounting period” (i.e. usually 9 months after the company yearend). A completed CT600 form calculating the tax due should be submitted to the company’s local tax office; a copy of the company’s annual accounts must also be submitted to the company’s local tax office 12 months after the end of the company year. We’ll prepare, and can submit these for you, as part of our annual accounts service.
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