Spring Budget: Corporation Tax Rates
In today’s Budget Chancellor George Osborne pulled a rabbit out of the hat by announcing that corporation tax will fall further than previously stated.
In the Summer Budget plans were announced to reduce the rate of corporation tax from 20% to 19% from 1 April 2017 and then down to 18% from 1 April 2020. Today the Chancellor extended his plans to reduce the rate of corporation tax further with the rate dropping to 17% from 1 April 2020.
Tax on loans to shareholders to increase to 32.5%.
The rate of a tax charge on loans to shareholders will increase from 25% to 32.5%. This is specifically linked to the upper dividend rate.
For companies with profits of more than £20 million, the quarterly instalment dates will be brought forward. Those companies will now have to pay tax in the third, sixth, month and twelfth month of the accounting period.