Striking Off A Company -Tax Costs Increase
Since 1 March 2012 many companies will have lost out on a valuable tax concession. Until recently, small companies that were solvent but had ceased trading could distribute funds to shareholders in a tax efficient manner. Payments were made subject to capital gains tax at 28% rather than income tax at rates up to 50%.
Going forward, solvent companies not subject to formal liquidation proceedings will only be able to distribute up to £25,000 to shareholders as a capital receipt. Above that distributions will attract a 50% income tax charge. This is just one of many detailed changes that will have serious tax implications for businesses at the current time.
The intricacies of tax law require special attention from both a legal and non-legal perspective. At Rollingsons we pride ourselves on providing effective legal solutions to business problems but always recommend that specialist tax and accounting advice is sought from experienced professionals.
MHA MacIntyre Hudson is a top 20 accountancy firm providing both accountancy and business advice. More information regarding the changes to the tax concession discussed above can be found on their website at http://www.macintyrehudson.co.uk/article/striking-company-increasing-costs-1-march.