Resources Guides 08.12.16

Corporate tax planning & advice

Effective corporate tax planning should lie at the heart of a business’s profitability plan. Tax is a significant cost to most businesses, but planned effectively that cost can be mitigated to varying degrees.

Of course, every business is different in where tax exposure exists and where it can be managed, but three areas common to most businesses and where CBW can provide corporate tax advice for, are most likely the following:

  • When to defer income of profits
  • When it’s beneficial to bring forward costs
  • What capital allowance claims come in to play
  • International tax

When to defer income of profits

Depending on timing, moving when a sale is recognised to the next financial year – perhaps just delaying it a month or so, means that the profits from the sale will be taxable a whole year later. This may help reducing tax liability to a level where your company may be charged a lower rate of tax.

Different types of businesses may be able to take advantage of this in different ways, such as seasonal businesses and certain goods distribution models.

When it’s beneficial to bring forward costs

Recognising costs earlier, while reducing profits, also reduces tax liability. So it may be worth considering the timing of certain inevitable payments such as bonuses, employee pension contributions, debt provisions and operational expenses.

What capital allowance claims come in to play?

Capital allowances, their rules and regulations, are constantly changing and affect businesses in a wide range of ways. For instance, consider bringing forward an asset purchase if it generates an allowance. Often the sale of loss making assets can be used strategically to offset profits. This is also an area HMRC are particularly aggressive with and are quick to challenge claims beyond their scope.

Capital allowances are a specialist area and unique to each business or individual. Talking to one of CBW’s tax advice specialists will help put your circumstances in to perspective.

CBW provides advice and answers to your burning corporate tax planning questions

Our industry recognised corporation tax advice experts are here to support you and your business. In the course of working with our diversified client base, we get asked many questions about business taxes and the best ways to manage them. Here are some you may recognise:

  • What business tax allowances can I claim?
  • We made some investments some time ago and are now looking to sell them; how do I reduce my capital gains exposure?
  • We’ve heard about different tax models; what are they and which one is best for us?
  • Ultimately we are looking to sell our business; how do we build real value in our business that potential buyers will be looking for?
  • We’ve experienced some setbacks and have incurred losses; what’s the best way to manage these?
  • As a creative engineering company we invest a lot in research and development; what tax savings or allowances are available to us?
  • Changes in financial regulations are changing our business model, but what impact could this have on our bottom line?

Further information

Rest assured, if you need corporation tax advice or situation you wish to discuss, it’s likely we’ve experienced this before and have a solution for you.

Contact a member of the tax team for more information and to find out how we could help.