Accounts and Corporation Tax
Why choose Freedom in Numbers to help with accounts and corporation tax for your business?
If you run a limited company, you’re required by law to prepare annual accounts and corporation tax returns based on what sales and expenses your business has had during the year.
The accounts show how much profit your business has made after deducting all the expenses from your sales, and the corporation tax calculates how much tax is due on those profits, so it’s important to get these right.
Knowing what you can and can’t claim as expenses for your business is just one element of the accounts and corporation tax return, and is often done incorrectly by businesses.
We have extensive experience with accounts and corporation tax, including registering your business as a limited company with Companies House and the HMRC. If you’re struggling to understand what is best, and when to do it – get in touch and we’ll help!
It can be appealing to manage everything in your business, but a simple mistake could be costly for your business.
It’s best to start from the very beginning as this will help everything else run smoothly. This starts with bookkeeping. All our clients use Xero and Hubdoc together for their bookkeeping, and we manage that for you so that you know everything is correct and your taxes are right.
What you can and can’t claim against your profits can change often. Staying on top of the legislative changes and ensuring you’re claiming what you are entitled to can be a headache.
Once you’ve got a smooth bookkeeping process, we are able to concentrate on other aspects of your accounts and help your business to flourish, as well as complete the statutory year end accounts and corporation tax return.
Don’t panic, we’re here to help!
What are accounts?
Simply put, your accounts are the official documents showing exactly how well your business is performing in financial terms.
Every business, from the smallest sole trader to the biggest limited company, must keep accounts and accounting records (the data that makes up the accounts).
Although sole traders don’t have a legal requirement to submit their accounts to Companies House, unlike limited companies, it’s important to still have them to back up the tax return figures.
What year end should I choose?
The tax year runs from 6 April to 5 April and most businesses use this system for their accounting year too, but some people may find it convenient to use 31 March as the end date for their business year.
When you form your limited company, the month you form it in will determine the first financial year end, but you can change this to a date that suits your business.
You can extend your financial year up to 18 months long once every 5 years, but you can shorten it by a minimum of 1 day more frequently.
What is profit?
Profit is the excess earnings after you deduct the business expenses from the income, and differ from the cash coming in and going out.
What is included in a set of accounts?
A set of accounts will include statutory reports, such as a profit and loss account, a balance sheet, notes regarding what makes up the figures in those reports, and a report from the directors.
Depending on how your business is structured determines which elements of a set of accounts are required by law e.g. a limited company has to produce accounts in a set format and this is where you may need help from an accountant.
How is corporation tax calculated?
Corporation tax is the tax that UK companies pay on their taxable profits.
Taxable profits, and the profits you see in your accounts don’t always correspond, as there are some expenses that may not be allowed for tax, or if you’ve invested in some equipment that won’t directly impact profits.
Corporation tax is charged at 19% (rising to a maximum of 25% in 2023 for larger businesses)
If a company makes a taxable loss but had made a profit in the previous year, it may be able to use that loss against previous years taxable profits and get some tax refunded.
Why choose us for accounts and corporation tax support?
As a business owner, you want to know what the bottom line looks like. Have you made a profit, and if not, why.
Not only that, you want to know what the corporation tax is going to be too, so you can plan to pay it on time.
At Freedom in Numbers, we’re here to support your business, and take away the stress of the administrative side of business, giving you your freedom back.
We offer a monthly fixed fee service that it tailored to your business and will include all the services you’ll need to get started, including dealing with the HMRC on your behalf!
We will save you time and money.
We’re confident that you’ll love our brilliant customer service and have an excellent experience working with us.
Not sure what expenses you can and can’t include on your tax return?
Download our handy guide of the expenses you can and can’t claim.
Still unsure what everything means?
No problem, we’ve got some FAQ’s that will help answer your questions.
What deadlines should I need to know?
As a limited company owner, you are expected to send accounts to Companies House within 9 months of your financial year end, and pay any corporation tax to the HMRC.
You must deliver the corporation tax (submit) to the HMRC within 12 months of your company year end.
What expenses can I put through my accounts?
Any expenses that relate to the activity your business is involved in are allowed to be included in your company accounts.
However there are some expenses that relate to employees and director’s expenses that are also allowable.
Head over to our resources page to download our expenses guide.
How much is corporation tax?
The current rate of corporation tax is 19%, and is payable on taxable profits (sales less business expenses and adjustments).
Corporation tax is expected to increase to 25% in 2023 in line with the 2021 Budget announcements, for businesses with taxable profits above £250,000. Businesses between £50,000 – £249,999 will have a corporation tax rate between 19% and 25%.
Freedom in Numbers - Accounting and Business Support
We know running a business can be stressful, and sometimes it’s hard to know where to start.
We’d love to hear from you, and help you revolutionise your finance function.
Let us take the stress away, and help you get back to doing what you love.
I asked Hannah to complete my first self-assessment as I wanted to make sure that I included everything that I needed to and make sure that it was correct! Hannah was a great support, patiently answering lots of questions and helped me identify a couple of things which I had missed too. I would definitely recommend Freedom in Numbers, thank you!
Hannah and the team have exceeded all and any my expectations. Always friendly and always willing to speak to you on the phone if you raise and issue. Superb accountants
A very friendly, easy to talk to, accountants that understand how to use technology to make accounts easy.
From the outset Hannah has provided up to date information, sound advice and a comprehensive schedule for us to work to. Always quick to respond to questions and answers honestly. It’s very refreshing to meet an accountant who genuinely wants to help small businesses grow and to understand the individual.
An amazing accountant, quick, efficient, helpful, responsible and reliable. A pleasure to work with offering a personalised friendly service and a professional approach. My business is in safe hands. Extremely happy with how quickly emails and various questions are answered.
Freedom in Numbers has been great for setting up my start-up. They onboarded my business onto a modern accounting software system, like Xero which I can also login to, and then provide ongoing guidance on complicated issues. I now have a solution that gives me control, cost effectiveness and expertise I can rely on when I need it.
Freedom in Numbers have been an extremely valuable partner in supporting the growth of our business. As well as being diligent and dedicated accountants and financial managers they add tremendous value in terms of helping us improve processes with smart technology and systems. They’re extremely flexible and have helped us manage rapid growth and our changing business needs and have fast become an indispensable part of the team shaping and growing our business.
Hannah is my 3rd accountant in 3 years of running my business. I struggled to find an accountant who was dedicated to helping new start up / small businesses get set up properly and feel fully supported. I needed an accountant who would be patient, explain things, support me and work as an extension of my team. I won’t be changing accountants again. Hannah is wonderful. I finally feel I have someone I can trust to make sure the finance side of my business is being taken care of leaving me free to do what I enjoy most and what I’m good at in my business. I very highly recommend Hannah.