The Business Exchange Swindon & Wiltshire Edition 41: Feb/March 2019 | Page 10

FINANCE A recent history of Corporation Tax rates for small companies AMS Accountancy’s Peter Bromiley looks at how tax rates have changed in the last 12 years. In recent years, for small companies the Corporation Tax Rate has effectively increased from 20% to 25.07% (small UK business had a 6% rise in tax on profits - including dividend tax). Whereas, from 2006/07 to 2017/18, the main Corporation Tax Rate (for more profitable companies) was reduced from 30% to 19% (so for institutional shareholders or foreign owners there has been an 11% drop in the tax rate). In the last 12 years or so, large companies have benefitted massively from tax cuts. In contrast, small company owners have recently been hammered by the dividend tax. It does seem to be the case that recent Chancellors have been very favourable to big business - but less helpful to small UK businesses! Here is a table detailing the changes from 2006-2018. Tax year Main rate Small companies rate (incl. dividend tax from 2016/17) 2006/07 30% 19% 2007/08 30% 20% 2008/09- 2010/11 28% 21% 2011/12 26% 20% 2012/13 24% 20% 2013/14 23% 20% 2014/15 21% 20% 2015/16 20% 20% 2016/17 20% 20% + 6% dividend tax = 26% 2017/18 19% 19% + 6.07% dividend tax = 25.07% LET US HELP YOU FIND YOUR NICHE We’re specialist, independent recruitment consultants with vast experience of matching top talent with top organisations throughout Wiltshire, Oxfordshire and the Cotswolds. 01793 230469 Search ‘AMS Accountancy’ on YouTube and watch their 80+ informative videos [email protected] www.nicherecruitment.co.uk Ask AMS Advice for small businesses AMS Accountancy Ltd. 01793 818400 What does the ‘Personal Tax Allowance’ mean? Every person who is resident in the UK is given a personal allowance each tax year. It operates as follows: LOVE OFFICE SPACE Flexible space with great terms MEETING ROOMS VIRTUAL OFFICE TELECOMS The personal allowance is the amount of income you can receive before paying tax – and it generally increases each tax year. For the 2018/19 tax year, it is £11,850. So, if you earn £20,000 in 2018/19, you will be subject to income tax on £8,150 of your earnings. BUSINESS SUPPORT As a business owner, it’s your passion and commitment that drives your business. Basepoint Business Centres share this enthusiasm and are committed to helping businesses by offering first-class workspaces alongside services that support you in making your business a success. The personal allowance is reduced when your income exceeds £100,000 in a tax year (by £1 for every £2 your income exceeds £100,000) – so that when your income reaches £123,700 (in 2018/19), you will no longer receive a personal allowance. Robwyn Cowper Offices | Flexi-Space | Virtual Office | Meeting Rooms Unique workspaces for your business Contact us today 70+ videos on YouTube. Search ‘AMS Accountancy’ 01793 602555 [email protected] @basepoint_swnd 10 THE BUSINESS EXCHANGE 2019 basepoint.co.uk @AMSAccountancy www.ams-accountancy.co.uk