Why is it useful?
Your Corporation Tax estimate provides an indication of what your company needs to set aside for the Taxman for Corporation Tax.
Limited companies are required to pay Corporation Tax on their profits. Profits are calculated from your company’s income and expenses in the financial year. Corporation Tax must be paid to HMRC within nine months from the end of your financial year.
Note that Corporation Tax is separate from Income Tax. You may need to pay Income Tax on salary or dividends if you are a director or shareholder of the company.
Where to find it in the app?
You can check your Corporation Tax estimate by following these steps:
1. Open the Countingup app and tap the 'Accounting' tab at the bottom of the screen
2. Tap ' Corporation Tax estimate'
Please note that your estimate is based on your profit to date. It assumes your company will continue to earn at a consistent rate throughout the rest of the year.
Tax estimate assumptions:
- This tax estimate only takes into account the business income and expenses captured by the app (from transactions through Countingup).
- The calculation of your profit is based on traditional accounting, not cash accounting (eg. based on the invoice or bill date rather than cash exchanged date).
- You have not carried forward losses from prior tax years (carried forward losses would typically reduce your tax bill).