UK company - Corporation Tax
Difference size of the UK business(es) can benefit from preferential corporate tax rate. In addition, in United Kingdom, for the sake of avoiding double taxation, because of the cross-border income, it has signed the world's most extensive coverage of double taxation treaty network. England has no foreign exchange controls and without prejudice, to the company profits earned abroad. England is also engaged in research and development tax credit for a lot of companies.
UK Tax
For those companies incorporated in the United Kingdom by the British central management or control company, they need to pay taxes on their worldwide income in the UK, but it will be adjusted according to the conditions of assessment. In some foreign countries, it has to pay taxes in the United Kingdom should the foreign income is taxable, but the tax paid abroad is usually deducted from the British tax bill. To put it in a simple, when the UK company is set up, wherever the company operates, it must annually report to the UK Inland Revenue Tax. Whether the company has to pay taxes depending on whether any profits of the companies in the year of assessment generated ? If the profit is negative, it is not subject to tax; any profits generated by the UK Inland Revenue requirement must be calculated by using tax rates to pay taxes.
UK Corporation tax rate
UK corporation tax rate is as follows:-
( 1 ) for less than £ 300,000.00, the profit tax rate is 21% ;
( 2 ) for £ 1.5 million to £ 300.001.00, the profits is between in a " fringe rate " ;
( 3 ) for More than £ 1.5 million in profits , the rate is 28%.
If you set up a branch of an overseas company in the UK, that branch’s profits are taxable in the UK. The rate is usually 28% but in some cases, it may be less than this number.
VAT
Under the following circumstances, the UK company is required to pay VAT :
(1) in the United Kingdom or in the Isle of Man (lsle of Man), to provide goods or services ;
(2) the company's taxable turnover exceeds the threshold, the current threshold is £ 64,000.00.
After completion of VAT registration, it will be able to reclaim sufficient to buy the business related goods or services as the value-added tax paid. The company’s VAT paid to suppliers is known as VAT; VAT that are charged to customers is called output tax.
In UK, to impose VAT for goods and services is known as “Taxable supplies” (taxable supplies).
Company's taxable supplies (taxable supplies) is the company's taxable gross turnover.
Under the following scenario, the UK companies need to pay for the VAT registration :
(1) at the end of any month, during the past 12 months or more, the company, in the short term the "taxable turnover " beyond the £ 64,000.00 ;
(2) at any time, the company estimated that, within the next 30 days, the "taxable turnover " value exceeds £ 64,000.00 .
VAT rate
There are three kinds of VAT rate :-
( 1 ) 17.5% ; it applies to most of the goods and services ;
( 2 ) 5% ; it is suitable for family or charity for fuel and electricity ;
( 3 ) 0% ; it is applicable to a range of goods, including most of the food, books, newspapers and children's books.
VAT-Exemption
Some commercial supply is without VAT levied thereon, they are "tax free", such as :-
(1) Insurance ;
(2) The sale of land and housing, long-term leases, short-term lease (garages , parking spaces, hotel and holiday except housing) ;
(3) Certain types of education and training.