Corporation Tax
If a company is a UK resident, it pays corporation tax on its worldwide profits, which are adjusted for tax purposes. A company qualifies as a UK resident if it is incorporated in the UK, or if its central management and controls are in the UK. Any foreign income on which a company pays tax abroad is liable to tax in the UK. However, any overseas tax paid can usually be credited against a company's UK tax bill.
The UK has one of the lowest corporate tax regimes in the developed world, with a main rate of 28% and a small company rate of 21%.
|
Corporation tax rates |
2008/09 |
|
Full rate (profits >£1.5 million) |
28% |
|
Intermediate rate (profits £300,000 to £1.5 million) |
29.75% |
|
Small company rate (profits to £300,000) |
21% |
Source: HM Revenue & Customs 2008
