Corporation Tax


R

revm

Hi, I hope someone can help with a simple question.

We want to put money aside for corporation tax when we pay a dividend. What
is the best way to accomplish this?

I'm concerned that the money will sit in our current account and may be
spent by the time we need to pay the corp tax.

Thanks,
Ross
 
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D

DL

Presumably you meant Corporation tax "and" Dividend
Open a deposit account & transfer the money.
 
R

revm

Thanks DL,
I see. So we use another bank account to put money aside.

Should I account for the estimated Corporation Tax by creating an entry in:
2330 Income tax/Corporation tax Payable
Thanks again,
Ross
 
D

DL

Not neccessary simply transfer whatever money you want to save to the
deposit account.
Creating an estimate wont do anything as the monies will remain in your
current account
As a *rough guide* CorpTax would be 22% of net profit, but that assumes you
have entered data correctly and that data is a legitimate expense.
You can only pay a Dividend from Profit, after tax the deduction.

BTW microsoft.public.uk.moa is the UK group, you are posting to the US group
 
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R

revm

Thank you very much DL.
Appreciate it.

DL said:
Not neccessary simply transfer whatever money you want to save to the
deposit account.
Creating an estimate wont do anything as the monies will remain in your
current account
As a *rough guide* CorpTax would be 22% of net profit, but that assumes you
have entered data correctly and that data is a legitimate expense.
You can only pay a Dividend from Profit, after tax the deduction.

BTW microsoft.public.uk.moa is the UK group, you are posting to the US group
 

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