If you start a business, and it’s massive, at least it’s not your own solitary operation.

You may need to discern whether businesses are subject to corporation tax and what changes after the Autumn Statement.

This article will cover everything you need to know about corporation tax and the support you will receive.

Under what circumstances do you have to pay corporation tax?

  • If you are running a limited company
  • Overseas companies with branches or offices in the UK
  • A club, cooperative or other unincorporated association (society or sports club)

Once the above conditions are met, what next?

Usually, you won’t receive any bills, which doesn’t mean you can ignore your taxes.

Here are a few things you might want to pay extra attention to:

  • Register for corporation tax when you start a business or restart a dormant business.
  • Keep accounting records and prepare corporation tax returns.
  • Pay taxes or file reports by the deadline (9 months and 1 day from the end of the “accounting period”).
  • File a corporation tax return (within 12 months from the end of the accounting period).

Taxable profits for corporation tax

Taxable profits for corporation tax include trading profits, investments and assets sold above cost.

If your business is based in the UK, all profits from the UK and overseas are subject to corporation tax.

If your business only has a branch in the UK, you only need to pay for UK profits.


Other tax changes

The newly released autumn budget mentions some changes to the corporation tax, which will take effect from April 1, 2023.

The government has confirmed it will charge companies with profits over £250,000 a 25 per cent corporation tax.

The diverted profits tax (DPT) rate will increase from 25% to 31%.

Any business involved in online sales will not be charged Online Sales Tax (OST).