Sarah Bradford explains why some company owners and their advisers may need to consider the corporation tax reforms sooner than they think.
Corporation tax is being reformed from 1 April 2023. From that date, the rate at which a company pays corporation tax on its profits will depend on the level of its profits and the number of associated companies it has (if any). There is something of a sense of déjà vu here, as lower and upper profits limits and marginal relief are resurrected.
For financial year 2021, and for financial year 2022 (starting on 1 April 2022) all companies pay corporation tax at the main rate of 19%. As a result of the reforms, from 1 April 2023 some companies will continue to pay corporation tax at 19%, some will pay corporation tax at a rate of between 19% and 25%, with the remainder paying corporation tax at 25%. The legislation to give statutory effect to the reforms is contained in CTA,
