I have a limited company set up for buying, renovating and selling residential properties. Does the company pay tax on every property it sells or the total profit/loss after the end of the tax year? The idea is to keep the profits as low as possible for the next few years and keep reinvesting in new properties. So, for example, if we spend £500,000 buying houses, sell them all for £800,000 then spend the whole of that £800,000 buying more houses (all within the same tax year) would we pay any tax?

Arthur Weller replies:
The company pays tax on every property it sells. So, in your example, the company would pay tax on £300,000 profit. The fact that the company afterwards reinvested in more properties doesn't take away from the fact that a profit of £300,000 has been made.