Hoping someone can clear this up. Just discussing this earlier today at client co with fellow contractors. I think we're all on about the same thing, but we're wording it differently!
Basically, if I have sales of £10,000 and I have no expenses, then corporation tax is paid on £10,000....correct?
If I have sales of £10,000, and expenses are £5,000 - whether that's a computer, company pension contribution, or anything else - then corporation tax is paid on £5,000? Or can you only claim 20% of the expense (£1,000) - therefore leaving you to pay CT on £9,000?
Just thought I'd post it up here as I think we've all had conflicting/confusing explanations from our accountants for something relatively simple.
Basically, if I have sales of £10,000 and I have no expenses, then corporation tax is paid on £10,000....correct?
If I have sales of £10,000, and expenses are £5,000 - whether that's a computer, company pension contribution, or anything else - then corporation tax is paid on £5,000? Or can you only claim 20% of the expense (£1,000) - therefore leaving you to pay CT on £9,000?
Just thought I'd post it up here as I think we've all had conflicting/confusing explanations from our accountants for something relatively simple.
Comment