Direct taxes - Corporate Income Tax

    Generic part

    Corporate income tax
    Corporation tax
    UK - United Kingdom
    GBP
    Date
    Year
    1965/04/01
    2019/01/01
    2019/02/11 16:13:59

    Contact information

    Administration

    HMRC

    Service

    https://www.gov.uk/government/organisations/hm-revenue-customs/about/statistics#contact-us

    Website

    E-mail

    Telephone

    Who sets

    The tax rate is set by

    • Central authority
    • Regional authority
    • Local authority
    • Social security

    The tax base is set by

    • Central authority
    • Regional authority
    • Local authority
    • Social security

    The reliefs are set by

    • Central authority
    • Regional authority
    • Local authority
    • Social security

    Beneficiary

    • Central authority
    • Regional authority
    • Local authority
    • Social security
    • Others

    Geographical Scope

    UK - United Kingdom
    No Yes

    Taxpayers

    Which entities are liable for CIT?

    • Legal persons
    • Organizational units having no legal personality
    • Tax capital groups
    • Associations
    • Foundations
    • Companies having their seat or management office in other countries, provided that in their country they are treated as legal persons and are subject to tax on income
    • Public corporations
    • Others

    Which entities are exempt from CIT?

    Domestic-source income of non-resident entities is

    Taxed
    Not Taxed

    Tax object and basis of assessment

    As general rule, taxable income under corporate income tax includes also

    • Interest
    • Royalties
    • Dividends
    • Capital gains
    • Income from immovable property
    • Income from movable property not listed above
    • Income from agriculture

    Income considered

    Domestic income
    Worldwide income (subject to double-tax relief)

    Deductions, allowances, credits, exemptions

    Valuation of inventory

    • First-in first-out (FIFO)
    • Last-in first-out (LIFO)
    • Average cost
    • Specific identification

    Depreciation rules

    Buildings

    Depreciable
    Not-depreciable
    • Straight-line method
    • Declining balance
    • Production method
    • Combination of above
    • Other

    Other fixed immovable assets (e.g. machinery)

    Depreciable
    Not-depreciable
    • Straight-line method
    • Declining balance
    • Production method
    • Combination of above
    • Other

    Movable (tangible) assets (e.g. cars, furniture, work equipment)

    Depreciable
    Not-depreciable
    • Straight-line method
    • Declining balance
    • Production method
    • Combination of above
    • Other

    Intangible assets (e.g. patents)

    Depreciable
    Not-depreciable
    • Straight-line method
    • Declining balance
    • Production method
    • Combination of above
    • Other

    Land (if any)

    Depreciable
    Not-depreciable
    • Straight-line method
    • Declining balance
    • Production method
    • Combination of above
    • Other

    Are there limits to interest deductions (other than thin capital rules)?

    No Yes
    30% of tax-EBITDA, although an alternative group ratio calculation is also available if it allows a greater level of deductability.

    Is there an Allowance for Corporate Equity?

    No Yes

    Exemptions from taxable income

    No Yes
    • Income from participations (dividends)
    • Patents income (e.g. patent boxes)
    • Other, please describe
    Charitable Organisations

    Expenses that are generally not deductible:

    Losses

    Loss carry-forward exists?

    No Yes
    • Indefinite

    Loss carry-backward exists?

    No Yes
    • Indefinite
    1 Years

    Tax credits available?

    No Yes
    • For research and development investments
    • For training
    • Other, please describe:

    Rate(s) Structure

    19 %
    0 %
    0 %
    0 %
    19 %

    Special tax rate for SMEs

    No Yes

    Measures against profit shifting

    Do Thin Capitalization (TC) rules exist?

    No Yes
    • Explicit TC law
    • Part of CIT law
    • Arm’s length
    • Ratio
    :
    Internal
    Internal and external

    TC depends on shareholding?

    No Yes
    Direct
    Indirect

    Automatic remedy

    No Yes
    • Non-deductibility of interest
    • Reclassification as dividend
    All companies
    Foreign companies
    Non-EU companies

    Transfer pricing rules exists?

    No Yes
    No Yes
    • Fee
    • Tax base increase

    Special features

    Is group taxation available?

    No Yes

    Is there a specific anti-avoidance provision in the legislation?

    No Yes

    International aspects

     
    Treaty countries
    Non-treaty countries
    Repatriated profits are taxed according to the following system
    • Exemption system
    • Tax credit
    • Deduction
    • Exemption system
    • Tax credit
    • Deduction
    Interest received is taxed
    No Yes
    No Yes
    Tax rate on interest received
    19 %
    19 %
    Outgoing dividends withholding tax
    0 %
    0 %
    Outgoing royalty payments withholding tax
    0 %
    20 %
    Outgoing interest payments withholding tax
    0 %
    20 %
    Foreign losses (of either subsidiaries or permanent establishments) can be set-off
    No Yes
    No Yes
    If yes :
    Minimum direct or indirect shareholding to qualify loss-offset (if applicable)
    75 %
    75 %
    Loss carry-forward exists?
    No Yes
    No Yes
    If yes :
    Time limit
    • Indefinite
    • Indefinite
    Size limit
    Loss carry-backward exists?
    No Yes
    No Yes
    If yes :
    Time limit
    • Indefinite
    3 Years
    • Indefinite
    3 Years
    Size limit
    Controlled foreign company (CFC-) rules exist?
    No Yes
    No Yes
    If yes :
    Time limit:
    • Indefinite
    1 Years
    • Indefinite
    1 Years
    Size limit
    50,000
    50,000
    Threshold for capital or voting power held directly or indirectly by resident in non-resident company:
    50.01 %
    50.01 %
    CFC-rules apply if foreign tax rate is lower than:
    75 %
    75 %
    CFC-rules apply for passive income only?
    No Yes
    No Yes

    Tax due date

    When has the tax return to be filed

    • 3 months after closing of the tax period
    • 6 months after closing of the tax period
    • Later than 6 months after closing of the tax period
    • Date set by the Authority
    • Other
    • Extensions of the deadline are possible

    Advance tax payments due?

    No Yes
    • Monthly
    • Quarterly
    • Bi-annual
    • Annual
    • Other

    Tax collector

    General comments

    Economic function

    • Consumption
    • Labour Employed (paid by employers and employees)
    • Labour Non-employed
    • Capital income: corporations
    • Capital income: income of households
    • Capital income: income of self-employed
    • Capital stocks

    Environmental taxes

    • Energy
    • Transport
    • Pollution/resources

    Tax revenue

    d51o-c01
    Year Annual tax revenue (in millions) % of GDP % of total tax revenue -
    2017
    57,500
    2.8125 %
    8.2579 %
    2016
    52,455
    2.6633 %
    7.9419 %
    2015
    45,280
    2.3884 %
    7.2473 %
    2014
    44,821
    2.4303 %
    7.4562 %
    2013
    44,308
    2.5156 %
    7.6206 %
    2012
    44,591
    2.6316 %
    7.9336 %
    2011
    46,165
    2.8072 %
    8.2659 %
    2010
    46,272
    2.9148 %
    8.7056 %
    2009
    39,230
    2.552 %
    7.9182 %
    2008
    45,199
    2.8611 %
    8.2878 %
    2007
    47,968
    3.1119 %
    9.2305 %
    2006
    47,457
    3.2374 %
    9.6196 %
    2005
    45,090
    3.2468 %
    9.7064 %
    2004
    36,840
    2.8061 %
    8.4875 %
    2003
    30,825
    2.4624 %
    7.6891 %
    2002
    30,384
    2.5685 %
    8.0217 %
    2001
    33,165
    2.9364 %
    8.8862 %
    2000
    35,937
    3.299 %
    9.8861 %

    Footnotes