Corporate Tax Rates
Corporation/Employers Tax Rates & Allowances 2010/11
Years to 31.3.11 and 31.3.10 |
||
| Profits band £ |
Rate % |
|
| Small companies rate | 0 - 300,000 | 21* |
| Marginal (small companies) rate | 300,001 - 1,500,000 | 29.75* |
| Full rate | Over 1,500,000 | 28* |
| Small companies fraction | 7/400* | |
The profits limits are reduced for accounting periods of less than 12 months and for a company with associated companies.
*Different rates apply for ring-fenced (broadly oil industry) profit.
Capital Allowances
Plant and machinery - Annual Investment Allowance (AIA)
The AIA gives a 100% write-off on most types of plant and machinery costs, including integral features and long life assets but not cars, of up to £50,000 p.a. The limit is increased to £100,000 for expenditure incurred on or after 6 April 2010 (1 April 2010 for companies). Special rules apply for accounting periods straddling these dates.
Any costs over the AIA fall into the normal capital allowance pools at either 10% or 20%. The AIA may need to be shared between certain businesses under common ownership.
Other plant and machinery allowances
The annual rate of allowance is 20%. A 10% rate applies to expenditure incurred on integral features and on long life assets.
A temporary 40% first year allowance may be due for certain expenditure exceeding the AIA incurred in the 12 month period beginning on 6 April 2009 (1 April 2009 for companies). A 100% first year allowance may still be available on certain energy efficient plant and cars.
Cars
For expenditure incurred on cars on or after 6 April 2009 (1 April 2009 for companies), costs are generally allocated to one of the two plant and machinery pools. Cars with CO2 emissions not exceeding 160gm/km receive a 20% allowance p.a. Cars with CO2 emissions over 160gm/km receive a 10% allowance p.a.
Industrial and agricultural buildings and hotels
The annual rate of allowance is 1% (2%) from 6 April 2010 (1 April 2010 for companies). Special rules apply for accounting periods straddling these dates.
Value Added Tax
| Standard rate | 17.5%* |
| Reduced rate | 5% |
| Annual Registration Limit - from 1.4.10 (1.5.09 - 31.3.10 £68,000) | £70,000 |
| Annual Deregistration Limit - from 1.4.10 (1.5.09 - 31.3.10 £66,000) | £68,000 |
*15% from 1 December 2008 - 31 December 2009.
Flat Rate Scheme - allows businesses to calculate their VAT payment as a percentage of their VAT inclusive turnover.
Limits - annual VAT exclusive taxable turnover does not exceed £150,000 and total VAT exclusive annual turnover does not exceed £187,500. Leave on anniversary of scheme where total VAT inclusive annual turnover exceeds £225,000.
Cash Accounting - allows businesses to account for input and output VAT on a paid and received basis.
Limits from 1 April 2007 - where annual VAT exclusive taxable turnover does not exceed £1,350,000. Leave at end of a VAT period where annual VAT exclusive taxable turnover exceeds £1,600,000
Annual Accounting - allows businesses to smooth out cash flow by paying a set amount, either monthly or quarterly. Only one VAT return due a year.
Limits - where annual VAT exclusive taxable turnover does not exceed £1,350,000. Leave on anniversary of scheme where annual VAT exclusive taxable turnover exceeds £1,600,000.
Car, Van and Fuel Benefits
Company cars 2010/11 |
|
| CO2 emissions (gm/km) (round down to nearest 5gm/km) | % of car’s list price taxed |
| up to 130 | 15 |
| 135 | 16 |
| 140 | 17 |
| 145 | 18 |
| 150 | 19 |
| 155 | 20 |
| 160 | 21 |
| 165 | 22 |
| 170 | 23 |
| 175 | 24 |
| 180 | 25 |
| 185 | 26 |
| 190 | 27 |
| 195 | 28 |
| 200 | 29 |
| 205 | 30 |
| 210 | 31 |
| 215 | 32 |
| 220 | 33 |
| 225 | 34 |
| 230 and above | 35 |
Company cars
- For diesel cars add a 3% supplement but maximum still 35%. Euro IV diesel cars registered before 1 January 2006 do not suffer the 3% supplement.
- Discounts apply to certain environmentally friendly cars.
- A 10% rate applies to non-electric cars with emissions of no more than 120gm/km. Environmentally friendly discounts do not apply to these cars but the diesel supplement does.
- For cars registered before 1 January 1998 the charge is based on engine size.
- The list price includes accessories and is subject to an upper limit of £80,000.
- The list price is reduced for capital contributions made by the employee up to £5,000.
Car fuel benefit 2010/11
£18,000 x ‘appropriate percentage’*
*Percentage used to calculate the taxable benefit of the car for which the fuel is provided.
- The charge is proportionately reduced if provision of private fuel ceases part way through the year. The fuel benefit is reduced to nil only if the employee pays for all private fuel.
Van benefit per vehicle 2010/11
Van benefit £3,000
Fuel benefit £550
- The charges do not apply to certain environmentally friendly vans or if a 'restricted private use condition' is met throughout the year.
Mileage Allowances
Cars and vans |
2010/11 and 2009/10
|
| Up to 10,000 miles | 40p |
| Over 10,000 miles | 25p |
| Bicycles | 20p |
| Motorcycles | 24p |
These rates represent the maximum tax free mileage allowances for employees using their own vehicles for business. Any excess is taxable. If the employee receives less than the statutory rate, tax relief can be claimed on the difference.
National Insurance
| Class 1 (employed) contracted in |
2010/11 Rates | |
| Weekly earnings | Employer | Employee |
| Up to £110 | Nil* | Nil* |
| £110.01 - £844 | 12.8%** | 11%** |
| Over £844 | 12.8%** | £80.74 +1%*** |
| * Entitlement to contribution-based benefits retained for earnings between £97.01 and £110 per week. ** On earnings above £110. *** On earnings above £844. |
||
| Class 1A (employers) | 12.8% on employee taxable benefits |
| Class 1B (employers) | 12.8% on PAYE Settlement Agreements |
| Class 2 (self-employed) | flat rate per week £2.40 small earnings exception p.a. £5.075 p.a. |
| Class 3 (voluntary) | flat rate per week £12.05 |
| Class 4 (self-employed) | 8% on profits between £5,715 and £43,875 plus 1% on profits over £43,875 |
