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TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15979
Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
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In the first year as a company profit was low (£100) and Im

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In the first year as a company profit was low (£100) and I'm a small company, so can I automatically charge myself the Corp Tax small profits rate of 20%, or do I still have to use the main rate of 23% for this year? Do you have to tell HMRC that you are using the small profit rate scheme if you use the lower rate?

When you complete the CT600 Corporation Tax return, you will be asked to select the tax rate applicable to your level of profits, subject to the associated companies rules. Take a look at the short CT600 here and the full CT600 here.

I hope this helps but let me know if you have any further questions.
Customer: replied 4 years ago.

Thank you, XXXXX XXXXX as I can tell I qualify, but my question is I'm not sure if I'm missing something. Is it as simple as choosing the lower rate if I qualify, or do I need to do anything else? Is this for special cases, or for all small companies with low profit?

Unless your company has made more than £300,000 in profit or is associated with other companies in which case the £300,000 limit is divided between them, your company will pay CT at 20% on it's profit of £100.

I complete CT600s every day. The are far simpler than personal tax returns. especially if you use commercial software which usually only requires a few figures with the accounts being attached to it. The HMRC software requires you to put every figure from a set of accounts into a box.

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