{"id":36666,"date":"2023-01-17T11:59:49","date_gmt":"2023-01-17T11:59:49","guid":{"rendered":"https:\/\/swoopfunding.com\/za\/?post_type=blog&#038;p=36666"},"modified":"2024-05-17T18:19:07","modified_gmt":"2024-05-17T18:19:07","slug":"how-to-register-and-pay-for-corporation-tax","status":"publish","type":"blog","link":"https:\/\/swoopfunding.com\/za\/blog\/how-to-register-and-pay-for-corporation-tax\/","title":{"rendered":"How to register and pay for corporation tax"},"content":{"rendered":"<div class=\"aivoov-player-block\">\n\t<div class=\"read_this\">Read this article to me<\/div>\n\t\t\t<style>\n\t\t\t.plyr__controls .plyr__controls__item:first-child{\n\t\t\t\tbackground:#2e9c8e !important;\n\t\t\t}\n\t\t\t:root{\n\t\t\t--plyr-color-main:#2e9c8e;\n\t\t\t--plyr-audio-controls-background:#f0f2f4;\n\t\t\t--plyr-audio-control-color:#546a7b;\n\t\t\t}\n\t\t\t[data-plyr=\"mute\"]{color:#2e9c8e !important}\n\t\t\t.aivoov-text-color{color:#546a7b}\n\t\t<\/style> \n\t\t<div class=\"audio_player\">\n\t\t<audio class=\"js-player\" controls=\"\">\n\t\t\t<source src=\"https:\/\/monky-voice-over.s3.amazonaws.com\/aivoov\/781640cc-7bc1-4bbf-9492-22dedc19678b\/ffbbf65d-c00c-458a-9baf-09b4fc299e52.mp3\" type=\"audio\/mp3\">\n\t\t\t<source src=\"https:\/\/monky-voice-over.s3.amazonaws.com\/aivoov\/781640cc-7bc1-4bbf-9492-22dedc19678b\/ffbbf65d-c00c-458a-9baf-09b4fc299e52.mp3\" type=\"audio\/ogg\" \/>\n\t\t<\/audio> \n\t\t\t\t <div class=\"powerd_by aivoov-text-color\"><p><a rel=\"nofollow noopener\" target=\"_blank\" href=\"http:\/\/aivoov.com\/?um_source=plugin_powered_by\" style=\"color: inherit;\">Powered by AiVOOV<\/a><\/p><\/div>\n\t\t \n\t\t<\/div>\n\t\t<\/div>\n\n\n\n<p>If you\u2019re a limited company, you\u2019ll need to pay corporation tax on your profits each year. <a href=\"https:\/\/swoopfunding.com\/uk\/business-glossary\/sole-trader\/\">Sole traders<\/a> and partnerships don\u2019t need to pay corporation tax as they must pay income tax through <a href=\"https:\/\/swoopfunding.com\/uk\/blog\/how-to-complete-a-self-assessment-tax-return\/\">self-assessment<\/a> instead.<\/p>\n\n\n\n<p>This guide explains all you need to know about how to pay corporation tax and the deadlines for doing so.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Who has to pay corporation tax to HMRC?<\/h2>\n\n\n\n<p>It\u2019s a legal requirement to pay corporation tax to <a href=\"https:\/\/www.gov.uk\/government\/organisations\/hm-revenue-customs\" target=\"_blank\" rel=\"noopener\">HM Revenue &amp; Customs<\/a> (HMRC) if you\u2019re a <a href=\"https:\/\/swoopfunding.com\/uk\/business-glossary\/limited-company\/\">limited company<\/a> trading and registered in the UK. You will need to start paying corporation tax once you are turning a <a href=\"https:\/\/swoopfunding.com\/uk\/business-glossary\/profit\/\">profit<\/a>.<\/p>\n\n\n\n<p>Companies must register for corporation tax when they set up as a limited company. You can do this via <a href=\"https:\/\/www.gov.uk\/limited-company-formation\/set-up-your-company-for-corporation-tax\" target=\"_blank\" rel=\"noopener\">the gov.uk website<\/a> and it must be done within three months of starting to trade. Trading includes buying, selling, advertising, renting a property and employing someone.&nbsp;<\/p>\n\n\n\n<p>To register, you will need to sign into your business tax account. You\u2019ll need your company\u2019s Government Gateway user ID and password to do this \u2013 if you don\u2019t have one, you can create one at sign in. You will also need your company\u2019s 10-digit Unique Taxpayer Reference (UTR) which will be posted to you within 14 days of the company being registered with <a href=\"https:\/\/www.gov.uk\/government\/organisations\/companies-house\" target=\"_blank\" rel=\"noopener\">Companies House<\/a>.&nbsp;<\/p>\n\n\n\n<p>You will need to tell HMRC your company\u2019s registration number, the date you started to do business (your company\u2019s first accounting period will start from this date), and the date your annual accounts are made up to.&nbsp;<\/p>\n\n\n\n<p>When you file your annual accounts with HMRC you will need to pay corporation tax on any profits for the financial year. This includes the money your company makes from doing business, investments or selling assets for more than they cost.&nbsp;<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">What is the criteria for paying corporation tax?<\/h2>\n\n\n\n<p>You will need to pay corporation tax if your business is one of the following:<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">An overseas company with a United Kingdom subsidiary<\/h3>\n\n\n\n<p>If your company is based overseas but has a UK subsidiary, that UK subsidiary must pay UK corporation tax on its worldwide profits. This is because the UK subsidiary is a separate legal entity to the parent company.&nbsp;<\/p>\n\n\n\n<p>By contrast, if an overseas company has set up a UK branch rather than a subsidiary, corporation tax is only charged on UK profits. This is because a branch is not legally separate from the parent company.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">A co-operative or club or community group<\/h3>\n\n\n\n<p>If you\u2019re a club, co-operative or other incorporated association such as a community group, you will need to pay corporation tax.&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">A limited company<\/h3>\n\n\n\n<p>All UK limited companies must pay corporation tax. It\u2019s the responsibility of the company director to make sure the corporation tax return has been submitted on time and the bill has been paid.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Mandatory requirements for a business paying corporation tax<\/h2>\n\n\n\n<p>If you need to pay corporation tax, you must calculate this yourself. This differs to individuals where HMRC will calculate your tax bill based on the details you\u2019ve provided.&nbsp;Use our handy <a href=\"https:\/\/swoopfunding.com\/uk\/business-loan-calculator\/corporate-tax-calculator\/\">corporation tax calculator<\/a> to help get you started.<\/p>\n\n\n\n<p>Each year you\u2019ll be required to complete a company tax return, or form CT600. The deadline for submitting your tax return is 12 months after the end of the accounting period it covers and you will need to work out your:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Profit or loss for corporation tax which will be different to the profit or loss shown in your annual accounts<\/li>\n\n\n\n<li>Corporation tax bill<\/li>\n<\/ul>\n\n\n\n<p>You can do this yourself or hire an accountant to prepare and file your tax return on your behalf. Your accounts must be filed to both HMRC and Companies House and you must file them online, unless you have a \u2018<a href=\"https:\/\/www.gov.uk\/tax-appeals\/reasonable-excuses\" target=\"_blank\" rel=\"noopener\">reasonable excuse<\/a>\u2019 to file in paper form. A reasonable excuse can include having a serious or life-threatening illness, a partner or close relative dying shortly before the deadline, or computer or software failures. You can also file by paper if you wish to file in Welsh.<\/p>\n\n\n\n<p>Even if you do not owe any corporation tax, you must still file a tax return. If you\u2019ve closed your accounts for the financial year and calculated that you don\u2019t owe corporation tax, you must tell HMRC that you have no tax to pay. To do this, complete the \u2018<a href=\"http:\/\/www.hmrc.gov.uk\/gds\/payinghmrc\/ct-nil.htm\" target=\"_blank\" rel=\"noopener\">nil to pay\u2019 form<\/a> or send back the payslip reminder from HMRC with the words \u2018NIL due\u2019 written on it.&nbsp;<\/p>\n\n\n\n<p>The way businesses pay corporation tax is changing from 1 April 2023. This means that the main rate of corporation tax is rising from 19% to 25%. However, smaller business with profits of \u00a350,000 or less will continue to pay 19%. The full 25% rate will apply to businesses with profits of \u00a3250,000 or more. Businesses with profits of between \u00a350,000 and \u00a3250,000 will be charged between 19% and 25% based on how much marginal relief they can claim. You can find out more about this on the <a href=\"https:\/\/www.gov.uk\/guidance\/corporation-tax-marginal-relief\" target=\"_blank\" rel=\"noopener\">gov.uk website<\/a>.&nbsp;<\/p>\n\n\n\n<p>Note that you can reduce your corporation tax bill by checking if you qualify for various corporation tax reliefs and claiming allowable expenses. All companies can deduct costs for expenses that have been used solely for business purposes such as office equipment and business-related travel and accommodation. You can deduct these costs from your company\u2019s profits before tax when you prepare your accounts.<\/p>\n\n\n\n<p>You can also save money by paying your tax bill early as HMRC will repay you some of it as interest at a rate of 0.5%.<\/p>\n\n\n\n<p>On the other hand, if you don\u2019t file your tax return on time, there will be a penalty to pay. You\u2019ll be charged \u00a3100 if you\u2019re a day late and another \u00a3100 if you still haven\u2019t filed after three months. After six months, HMRC will estimate your corporation tax bill and add an extra 10% of the unpaid tax. After 12 months, another 10% is added. If your tax return is late three times in a row, HMRC will increase the \u00a3100 penalties to \u00a3500 each.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">HMRC corporation tax payment deadline<\/h2>\n\n\n\n<p>Your corporation tax payment deadline will vary depending on the profits your business makes, as outlined below:<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">For businesses with up to \u00a31.5 million taxable profit<\/h3>\n\n\n\n<p>If your taxable profits are less than \u00a31.5 million, your business has nine months and one day after the end of the accounting period to pay the tax due. The accounting period is usually the financial year of your business, but you might have two accounting periods in the year you set up your company.&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">For businesses with more than \u00a31.5 million taxable profit<\/h3>\n\n\n\n<p>If your business has taxable profits of more than \u00a31.5 million, you will need to pay your corporation tax in instalments, which means the process is different.&nbsp;<\/p>\n\n\n\n<p>Be aware that the deadline for paying corporation tax is before the deadline for filing your company tax return. This means you will need to prepare your tax return well ahead of the deadline to be able to work out how much corporation tax to pay.&nbsp;<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Payment details for your corporation tax bill<\/h2>\n\n\n\n<p>There are a number of different ways to pay your corporation tax bill. Some payment methods are quicker than others so make sure you will still meet the deadline.&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Bacs &amp; CHAPS bank details<\/h3>\n\n\n\n<p>The quickest way to pay your tax bill is through online or telephone banking by Faster Payments or CHAPS. This will go through the same day or next day. You can also pay by Bacs but this will take up to three working days.<\/p>\n\n\n\n<p>For all of the above payment options, your notice to deliver your tax return or any reminder from HMRC will tell you which account to pay into. If you\u2019re not sure, use HMRC Cumbernauld. The account details are below:<\/p>\n\n\n\n<figure class=\"wp-block-table\"><table><tbody><tr><td>&nbsp;<\/td><td><strong>Sort code<\/strong><\/td><td><strong>Account number<\/strong><\/td><\/tr><tr><td>HMRC Cumbernauld<\/td><td>083210&nbsp;<\/td><td>12001039<\/td><\/tr><tr><td>HMRC Shipley<\/td><td>083210<\/td><td>12001020<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<p>Always use your 17-character corporation tax reference payment number for the accounting period you\u2019re paying.&nbsp;<\/p>\n\n\n\n<p>Corporation tax can also be paid by direct debit, debit or corporate credit card (not a personal credit card) or at your bank or building society. All of these payment options take three working days, although if you\u2019re setting up a direct debit for the first time, it can take up to five working days.&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">If issuing multiple payments<\/h3>\n\n\n\n<p>If you want to make a single payment to cover more than one company for the same accounting period, you can send an <a href=\"https:\/\/www.gov.uk\/government\/organisations\/hm-revenue-customs\/contact\/corporation-tax-payment\" target=\"_blank\" rel=\"noopener\">online CHAPS enquiry form<\/a>. You will need to include your name, contact number and the type of tax you wish to pay.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">HMRC&#8217;s banking address<\/h3>\n\n\n\n<p>Should you need it, HMRC\u2019s banking address is as follows:&nbsp;<\/p>\n\n\n\n<p>Barclays Bank PLC<\/p>\n\n\n\n<p>1 Churchill Place<\/p>\n\n\n\n<p>London<\/p>\n\n\n\n<p>UK<\/p>\n\n\n\n<p>E14 5HP<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Online corporation tax service<\/h2>\n\n\n\n<p>Most businesses should use <a href=\"https:\/\/www.gov.uk\/file-your-company-accounts-and-tax-return\" target=\"_blank\" rel=\"noopener\">the gov.uk online service<\/a> to file their company\u2019s tax return with HMRC and their accounts with Companies House. You can file your tax return and accounts at the same time if they are for the same accounting period. The service will automatically convert your accounts to the required format.&nbsp;<\/p>\n\n\n\n<p>You will need your company\u2019s annual accounts, Government Gateway user ID and password and Companies House password and authentication code if you\u2019re filing your accounts at the same time.&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Online company accounts management<\/h3>\n\n\n\n<p>As a limited company, you must keep records about the company itself, as well as financial and accounting records. Accounting records should include:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>All money received and spent by the company<\/li>\n\n\n\n<li>Details of assets owned by the company<\/li>\n\n\n\n<li>Debts the company owes or is owed<\/li>\n\n\n\n<li>Stock the company owns at the end of the financial year<\/li>\n\n\n\n<li>The stocktakings you used to work out the stock figure<\/li>\n\n\n\n<li>All goods bought and sold<\/li>\n<\/ul>\n\n\n\n<p>You must also keep records of money spent by the company, such as receipts, as well as records of money received by the company, such as invoices and sales books. You will need all of this to prepare and file your annual accounts and tax return. You can be fined \u00a33,000 by HMRC or disqualified as a company director if you do not keep accounting records.&nbsp;<\/p>\n\n\n\n<p>Filing your annual accounts to Companies House online will save your business time and money. The online filing service also includes built-in checks to help reduce the risk of making a mistake. Once your online filing has been received, you\u2019ll receive confirmation almost immediately. If your filing is rejected, you can quickly correct it and resend it.&nbsp;<\/p>\n\n\n\n<p>Online users also get access to protected online filing which helps protect your company from unauthorised changes to your records, as well as email reminders to tell you when your company\u2019s accounts are due. Additionally, you can use third party software to file most of your Companies House information online.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>If you\u2019re a limited company, you\u2019ll need to pay corporation tax on your profits each year. Sole traders and partnerships don\u2019t need to pay corporation tax as they must pay income tax through self-assessment instead. This guide explains all you need to know about how to pay corporation tax and the deadlines for doing so. [&hellip;]<\/p>\n","protected":false},"author":22,"featured_media":31189,"comment_status":"closed","ping_status":"closed","template":"","category":[367,362,59],"class_list":["post-36666","blog","type-blog","status-publish","has-post-thumbnail","hentry","category-sme-support","category-swoop-guides","category-blog"],"acf":[],"featured_image_urls_v2":{"full":["https:\/\/swoopfunding.com\/za\/wp-content\/uploads\/sites\/7\/2023\/01\/coroporation-tax-featured-scaled.jpg",2560,1707,false],"thumbnail":["https:\/\/swoopfunding.com\/za\/wp-content\/uploads\/sites\/7\/2023\/01\/coroporation-tax-featured-scaled-e1673957259210-150x150.jpg",150,150,true],"medium":["https:\/\/swoopfunding.com\/za\/wp-content\/uploads\/sites\/7\/2023\/01\/coroporation-tax-featured-300x200.jpg",300,200,true],"medium_large":["https:\/\/swoopfunding.com\/za\/wp-content\/uploads\/sites\/7\/2023\/01\/coroporation-tax-featured-768x512.jpg",768,512,true],"large":["https:\/\/swoopfunding.com\/za\/wp-content\/uploads\/sites\/7\/2023\/01\/coroporation-tax-featured-1024x683.jpg",1024,683,true],"1536x1536":["https:\/\/swoopfunding.com\/za\/wp-content\/uploads\/sites\/7\/2023\/01\/coroporation-tax-featured-1536x1024.jpg",1536,1024,true],"2048x2048":["https:\/\/swoopfunding.com\/za\/wp-content\/uploads\/sites\/7\/2023\/01\/coroporation-tax-featured-2048x1365.jpg",2048,1365,true],"image_blog":["https:\/\/swoopfunding.com\/za\/wp-content\/uploads\/sites\/7\/2023\/01\/coroporation-tax-featured-scaled-e1673957259210-408x252.jpg",408,252,true],"image_blog_full":["https:\/\/swoopfunding.com\/za\/wp-content\/uploads\/sites\/7\/2023\/01\/coroporation-tax-featured-1775x660.jpg",1775,660,true],"image_podcast":["https:\/\/swoopfunding.com\/za\/wp-content\/uploads\/sites\/7\/2023\/01\/coroporation-tax-featured-scaled-e1673957259210-397x298.jpg",397,298,true],"image_banking":["https:\/\/swoopfunding.com\/za\/wp-content\/uploads\/sites\/7\/2023\/01\/coroporation-tax-featured-30x20.jpg",30,20,true],"image_blog_internal":["https:\/\/swoopfunding.com\/za\/wp-content\/uploads\/sites\/7\/2023\/01\/coroporation-tax-featured-scaled-e1673957259210-840x480.jpg",840,480,true],"image_blog_medium":["https:\/\/swoopfunding.com\/za\/wp-content\/uploads\/sites\/7\/2023\/01\/coroporation-tax-featured-scaled-e1673957259210-1024x500.jpg",1024,500,true],"image_single_banking":["https:\/\/swoopfunding.com\/za\/wp-content\/uploads\/sites\/7\/2023\/01\/coroporation-tax-featured-80x53.jpg",80,53,true]},"post_excerpt_stackable_v2":"<p>Read this article to me Powered by AiVOOV If you\u2019re a limited company, you\u2019ll need to pay corporation tax on your profits each year. Sole traders and partnerships don\u2019t need to pay corporation tax as they must pay income tax through self-assessment instead. This guide explains all you need to know about how to pay corporation tax and the deadlines for doing so. Who has to pay corporation tax to HMRC? It\u2019s a legal requirement to pay corporation tax to HM Revenue &amp; Customs (HMRC) if you\u2019re a limited company trading and registered in the UK. You will need to&hellip;<\/p>\n","category_list_v2":"<a href=\"https:\/\/swoopfunding.com\/za\/category\/sme-support\/\" rel=\"category tag\">SME support<\/a>, <a href=\"https:\/\/swoopfunding.com\/za\/category\/swoop-guides\/\" rel=\"category tag\">Swoop guides<\/a>, <a href=\"https:\/\/swoopfunding.com\/za\/category\/blog\/\" rel=\"category tag\">Blog<\/a>","author_info_v2":{"name":"Rachel Wait","url":"https:\/\/swoopfunding.com\/za\/author\/rachel-wait\/"},"comments_num_v2":"0 comments","_links":{"self":[{"href":"https:\/\/swoopfunding.com\/za\/wp-json\/wp\/v2\/blog\/36666","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/swoopfunding.com\/za\/wp-json\/wp\/v2\/blog"}],"about":[{"href":"https:\/\/swoopfunding.com\/za\/wp-json\/wp\/v2\/types\/blog"}],"author":[{"embeddable":true,"href":"https:\/\/swoopfunding.com\/za\/wp-json\/wp\/v2\/users\/22"}],"replies":[{"embeddable":true,"href":"https:\/\/swoopfunding.com\/za\/wp-json\/wp\/v2\/comments?post=36666"}],"version-history":[{"count":5,"href":"https:\/\/swoopfunding.com\/za\/wp-json\/wp\/v2\/blog\/36666\/revisions"}],"predecessor-version":[{"id":41002,"href":"https:\/\/swoopfunding.com\/za\/wp-json\/wp\/v2\/blog\/36666\/revisions\/41002"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/swoopfunding.com\/za\/wp-json\/wp\/v2\/media\/31189"}],"wp:attachment":[{"href":"https:\/\/swoopfunding.com\/za\/wp-json\/wp\/v2\/media?parent=36666"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/swoopfunding.com\/za\/wp-json\/wp\/v2\/category?post=36666"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}