 |
Taxation and your business
How does your company become involved with income tax?
Although your company's income is usually liable to corporation tax rather than income tax, it may receive or pay amounts under deduction of income tax. For example, it may receive interest from Government stocks, which since the 6 April 1996 have suffered a 20% tax deduction at source. Or you may have made other payments such as charitable payments via your company under deed of covenant or gift aid, which are deemed to be net after deduction of the basic income tax rate of 22%. (N.B. any bank interest or building society interest is receivable by your company in full, with no tax deduction).
The system devised to neutralise the effect of income tax involves making quarterly returns known as forms CT61. Details of all tax withheld from your company's payments and suffered on its receipts, have to be reported within 14 days of the end of the return period. If the tax the company has withheld is greater than the tax suffered, the difference has to be paid over to the Revenue at the same date. On the other hand, if tax suffered is greater, there are procedures to enable tax to be refunded, set off or carried forward as appropriate.
|
|
