Tax Alert – 17th April 2019

Corporation Tax – ATED and Corporation Tax Instalment Payments

TAX ALERT

Annual Tax on Enveloped Dwellings (ATED)

If your company owns a residential property that is valued at £500,000 or more, you may need to file an annual ATED return.

There are exceptions to the ATED charge; but it is still necessary to file ‘NIL’ ATED returns.

The latest return period covers the year from 1st April 2019.

The deadline for submitting the ATED return is 30th April 2019.

Contact us if you believe your company may need to make a return.

CORPORATION TAX INSTALMENT PAYMENTS

Changes for ‘very large’ companies

This is a reminder of changes to instalment payments for very large companies.

The changes to the corporation tax instalment payments were introduced in 2017.

They apply to very large companies for accounting periods beginning on or after 1 April 2019.

Companies with taxable profits exceeding £20 million will be required to make payments four months earlier.

For a 12-month accounting period, payments will be due in months 3, 6, 9 and 12 of the current accounting period.

The £20 million threshold is reduced where the company is a member of a group and is pro-rata’d for accounting periods shorter than 12 months.

Payments relating to bank levy and CT and supplementary charge on ring fence profits of oil and gas companies will not move to the new payment regime.

However, if a company is very large, all other liabilities including bank surcharge will move to the new regime.

Affected businesses should ensure that they are ready for the changes.

The first instalment payment under the new rules will be due before the final payment under the current regime and will impact on cash flow in the first year.

For further information on the above matters or any other tax query, contact Paul Southward.

Paul Southward