Could These 8 Top Tips Reduce Your Corporation Tax?


While corporation tax is a necessary evil for all business owners, there are ways that tax experts, such as those at Carliv Accountants in Middlesbrough, can help you reduce the amount you’re required to pay.

If corporation tax and your VAT return are give you a headache every year, why not consult with an accountancy firm and see if they can use any of the 8 tips below to reduce both your stress levels, and the amount you owe:

  1. Claim R and D tax relief

If you’re developing new or improved processes, products or software within your business, or pay staff to solve technical problems, you might be able to reduce your corporation tax by as much as £25,000 for every £100,000 spent, with a Research and Development (RDA) allowance.

  • Make investments in plants and machinery

Enabling a business to claim tax relief on purchases of certain assets up to a specified limit, the Annual Investment Allowance (AIA), enables businesses to write off significant amounts of qualifying investments against their profits. Check with an expert at Carliv Accountants in Middlesbrough if you think this tip might apply to you.

  • Capital allowances on property

Did you know that if a business has spent money on new commercial buildings, it may be able to claim a 3% straight line writing down allowance, and you’d be advised to review your expenditure to determine whether it qualifies for capital allowances. With a VAT return experts help; you may even be able to claim allowances that were missed going back several years.

  • Claim all business expenses

While this might seem like a no-brainer, you’d be surprised how many company directors fail to claim back expenses they’ve incurred on behalf of the business.

  • Consider pension contributions

If your company has paid into pension schemes on behalf of their employees or directors, you should be able to get a deduction from your profits; a tax professional at Carliv Accountants in Middlesbrough will be able to guode you on this.

  • Creative industries relief

If your business is in a creative industry, such as video games, the Video Games Tax Relief (VGR) is one of eight tax reliefs applying to those companies who qualify, and enables them to take advantage of reduced rates of Corporation Tax.

If you’re in the video games industry, consult with a VAT return and corporation tax specialist for further guidance.

  • Subscriptions and training costs

As a tax expert from Carliv Accountants in Middlesbrough will tell you, if you’ve paid for training and subscription costs for an employee, those costs can be tax deductible for the company, resulting in the tax free development of your staff.

  • Organizing a staff celebration

All good employers like to treat their hardworking staff from time to time, and costs of up to £150 per head to pay for an annual staff party, can be completely tax free for employees and tax deductible for the company. Woo hoo, let’s party!

For more detailed advice and guidance on reducing your corporation tax, schedule a non-obligatory initial consultation with the tax pros at Carliv Accountants in Middlesbrough, and who knows, you could be throwing that celebratory party sooner than you think!