corporate tax

Question 1

what are some sources of uk rules on trading profits

Answer 1

1)legislations
2)case law
3)practice of tax authorities

Question 2

why cant you deduct depreciation for tax purposes

Answer 2

they are used during capital allowances

Question 3

how do you adjust the profit in the companies account to find the income from trading for tax

Answer 3

reported profit
+/- adjustments for items not recognised as trading for tax
+/- any taxable trading items not in the accounts
= income from trading for tax

Question 4

what is the maximum length of a period of account

Answer 4

18 months

Question 5

whats the difference in period between a companies chargeable accounting period and its period of account

Answer 5

a chargeable accounting period must be equal to or less than 12 months however a period of account can exceed 12 months (18 month max)

Question 6

when will there be 2 chargeable accounting periods be created

Answer 6

when a companys period of account exceeds 12 months.

Question 7

when does a chargeable accounting period (c.a.p) start and end

Answer 7

a c.a.p usually starts immediately after the end of the previous c.a.p

a c.a.p starts when a company commences trade

a c.a.p also ends when a company ceases to trade

Question 8

if a company prepares accounts for the period from
01/01/2022-31/03/2023
1)what is the period of account
2)what is the chargeable accounting periods
3)how many corporate tax computations will be made

Answer 8

1) the 15 months between 1/1/22-31/3/23
2) a. 1/1/22 - 31/12/22 (12 months)
b. 1/1/23 - 31/03/23 (last 3 months)

3) 2 coporatation tax computations will be prepared, one for each period

Question 9

when do financial years run from

Answer 9

1st of april to 31st of march

Question 10

what are examples of
1)direct revenue tax
2)direct capital tax
3)indirect tax

Answer 10

1)a- income tax
b- national insurance
c- corp tax paid on company profits
2) a- capital gains tax
b- inheritance tax
3) vat (tax paid ontop of the price of goods you buy)

Question 11

acca code of ethics and conduct 5 fundamental principles are?

Answer 11

1) integrity
2) objectivity
3) professional competence and due care
4) confidentiality
5) professional behaviour

Question 12

what are the deadlines for online and paper filing in tax self assessments

Answer 12

31/10/xxxx for paper
31/01/xxxx for online or 3 months later

Question 13

how long do small companies have to pay their taxes

Answer 13

within 9 months + 1 day of their chargeable period end

Question 14

what software must companies use to submit their self assessment returns

Answer 14

iXBRL (inline eXtensible Business Reporting Language)

Question 15

when does a self assessment tax return have to be submitted for the year ended 31st march 2023

Answer 15

31st march 2024 (12 months later

Question 16

1)until what date can hmrc amend a tax return
2)until what date can an individual amend a tax return

Answer 16

1)within 9 months from the date of filing
2)within 12 months

Question 17

what is the concept of entirety

Answer 17

how much of an asset has been repaired.
if most is repaired then its a capital expense so non deductible.
if a small part is repaired then it is deductible and a revenue expenditure

Question 18

whats the rule on leasing cars with with co2 emissions >50g/km

Answer 18

15% of the expense is disallowed

Question 19

how many years of pre trade costs can be claimed

Answer 19

7 years

Question 20

what are the restrictions on deductible expenses from gifts

Answer 20

1) no tobacco, alcohol, food or vouchers
2) £50 limit per customer per tax period
3)gifts must bare the company logo

Question 21

what should be done with income from dividends

Answer 21

this must be deducted

Question 22

What is the indexation calculation

Answer 22

(Rpi 2 - rpi 1)/ rpi 1 x cost

Question 23

What % of a car lease is a disallowed expense for co2 over 50g/km

Answer 23

15%

Question 24

When are pension contributions made by an employer tax deductible

Answer 24

Only once paid. It is not deductible if it’s meant to be paid within 9 months and hasn’t yet been paid

Question 25

How to calculate the lease allowable deduction

Answer 25

Px0.02x(n-1)=a
P-a=non capital part
Non capital part / n = allowable lease