For over 30 years Richard Edwards Group has been providing excellent advice and a first class service to our clients. We have a large portfolio of clients and service businesses across many sectors. Book one of our FREE INITIAL MEETINGS to start benefiting from our expertise today.

Spring Budget 2021 – Corporation Tax

Source: HM Government | | 04/03/2021

The Chancellor confirmed that the Corporation Tax main rate will remain at 19% from 1 April 2021 for the next 2 years. The main rate had been expected to increase to help pay the massive costs of the coronavirus pandemic to the public purse. 

However, the Corporation Tax main rate will increase to 25% from 1 April 2023 for companies with profits over £250,000. The Chancellor also announced the introduction of a Small Profits Rate (SPR) of 19% from the same date for companies with profits of up to £50,000. 

Where a company has profits between £50,000 and £250,000 a marginal rate of Corporation Tax will apply that bridges the gap between the lower and upper limits. The lower and upper limits will be proportionately reduced for short accounting periods and where there are associated companies.

The Diverted Profits Tax (DPT) will increase from 1 April 2023 from 25% to 31% to maintain the current 6% differential with the main rate of Corporation Tax. The DPT is an anti-avoidance measure that targets large multinational businesses that are deemed to be using contrived and artificial arrangements to divert profits overseas thereby paying less or no tax in the UK.

This announcement gives some short-term relief to businesses, many of whom had expected rates to increase before April 2023. 



 

Latest News

HMRC’s new penalty regime
15/04/2021 - More...
HMRC’s new points-based penalty regime for late submission and payment will start from 1 April 2022. The changes will apply in the first instance to the submission of VAT returns

One-off £500 payment for working households receiving tax-credits
15/04/2021 - More...
As part of the March 2021 Budget, the Chancellor announced that the temporary £20 weekly uplift in Universal Credits would continue for a further six months, until the end of


Newsletter

With our newsletter, you automatically receive our latest news per e-mail and get access to the archive including advanced search options!

» Sign up for the Newsletter
» Login