What is Corporation Tax?
Corporation Tax Payment Plans. Corporation Tax is a tax levied on the profits of limited companies and other business organizations in the UK.
It’s calculated on the taxable profits of a company and is due annually. The current rate of Corporation Tax in the UK is 19%. Companies may be required to pay this tax on their domestic and overseas profits.
The amount of tax owed will depend on the company’s specific financial situation and the rules and regulations set forth by the UK government.
When is Corporation Tax due?
In the UK, Corporation Tax is due 9 months and one day after the end of a company’s financial year. The payment must be made to HM Revenue and Customs (HMRC). Companies must also submit a Corporation Tax return to HMRC within 12 months of the end of their financial year, even if no tax is due.
What happens if you cannot pay your bill on time?
If a company is unable to pay its Corporation Tax bill on time, the following can happen:
- Penalties and Interest: HM Revenue and Customs (HMRC) may charge penalties and interest on late payments. The amount charged can increase the longer the payment is overdue.
- Default Notice: HMRC may issue a Default Notice, which gives the company 30 days to pay the full amount owed, including penalties and interest.
- Enforcement Action: If the company is unable to pay the amount owed, HMRC may take enforcement action, such as seizing assets or garnishing wages.
- Winding up proceedings: In extreme cases, HMRC may initiate winding up proceedings, which could result in the company being forced to close.
It’s important for companies to seek professional advice and explore all available options if they are unable to pay their Corporation Tax bill on time. This may include negotiating a payment plan with HMRC, applying for time to pay, or seeking external funding.
Corporation Tax Payment Plans
What is a Time To Pay (TTP) arrangement?
A Time to Pay (TTP) arrangement is a payment plan offered by HM Revenue and Customs (HMRC) in the UK for businesses or individuals who are unable to pay their tax bill in full and on time. The TTP arrangement allows the taxpayer to spread the payment of their tax debt over a period of time that is agreed upon by HMRC and the taxpayer.
The terms of the TTP arrangement are negotiated between the taxpayer and HMRC, taking into account the taxpayer’s financial situation. The arrangement is usually set up to allow the taxpayer to pay their tax debt in affordable instalments over a period of several months, rather than paying the full amount in one lump sum.
TTP arrangements are designed to help taxpayers who are facing temporary financial difficulties and are unable to pay their tax bill on time. However, they are not a permanent solution and the taxpayer must take steps to ensure that they are in a position to pay their tax bills in full and on time in the future.
What if we can’t get a Time to Pay (TTP)
If you can not get a TTP then you need to speak to a Commercial Finance Broker like ourselves. We can arrange alternative finance options to help you spread your costs over a period of up to 12 months.
We can help you spread your Corporation Tax over a period of up to 12 months!
Quarterly and annual Tax liabilities can put a strain on your cashflow, so why not align these with their other monthly expenditures and help free up your capital for business growth?
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Corporation Tax Payment Plans