Paying taxes on time is essential, particularly in the event that late fees are applied. Learn how to pay your corporation taxes in various ways online.
Up to £1.5 Million in Taxable Profits
The Corporation Tax must be paid nine months and one day after the end of the accounting period. You may have two accounting periods in the year that you set up your business, but usually, you have your accounting period in your financial year.
More than £1.5 Million in Taxable Profits
Corporation Tax must be paid in instalments. However, make sure you know the rules and deadlines, as it may vary for taxable profits between £1.5 million to £20 million and taxable profits more than £20 million.
Interest on Late Payments
You must pay any Corporation Tax owed on time if your company or organization is liable for Corporation Tax. The government will charge you interest every day if you fail to pay.
HMRC will charge your company or organization interest if you pay your Corporation Tax late, don’t pay enough, or don’t pay at all. The interest is called ‘late payment interest’ by HMRC.
Taxes are charged interest from the day after they should have been paid until the day you pay them. You will be charged interest automatically. Despite this, interest on the interest is not charged.
Interest paid to HMRC for late payments is deductible for Corporation Tax purposes. This means that interest is a business expense that can be included in the company’s accounting for the period (or periods) that it was incurred.
Interest on Instalment Payments
Late instalment payments are charged interest by HMRC. You can deduct interest for Corporation Tax purposes if you must pay it. Though this interest applies from the beginning of the accounting period to the end, its calculation takes place only after one of these two events has occurred:
- Your Company Tax Return has been submitted; or
- HMRC has determined your tax liability because you did not submit your return on time.
In most cases, interest is calculated after the normal due date.
Not paying on time will result in extra costs, such as interest. Avoid late payment taxes by paying your taxes conveniently online!
Online Payment
HM Revenue and Customs (HMRC) accepts Faster Payments, CHAPS, and Bacs.
HMRC will inform you which account to pay into in your’ notice to deliver your tax return’ or any subsequent reminders. You can also use HMRC Cumbernauld if unsure.
HMRC Cumbernauld
Sort Code: 083210
Account number: 12001039
To pay Corporation Tax, you will need your 17-character reference number.
Your reference number can be found on your ’notice to deliver your tax return’ or any reminders from HMRC. You can also locate it in your company’s HMRC online account – select ‘view Corporation Tax statement’ and ‘accounting periods’, then choose the correct period.
Make sure you use the correct reference number as it may result in delayed payments.
You may pay your Corporate Tax bills through Faster Payments, CHAPS, or Bacs.
Payments through Faster Payments will usually be received by the HMRC within 24 hours, even on weekends and holidays.
On the other hand, CHAPS payments will allow HMRC to receive your payment on the same working day but not on weekends and holidays.
Bacs payments take the longest time—it might take 3 working days for your payment to reach the HMRC.
You may also pay for your corporation tax through your personal debit card with no transfer fees. If you use a corporate card—debit or credit—a non-refundable fee will be charged to you. This will take your payment 3 working days before it reaches HMRC’s bank account.
Conclusion
The electronic payment of corporate taxes is an easy way to pay your taxes.
With the help of electronic payments, it is easier than ever to make your corporation’s payments to the HMRC. The convenience of this payment method is unmatched, and it is a positive way to receive your tax return faster.
The way that businesses and people conduct transactions has been changing rapidly over the past few years. In the United Kingdom, these changes have been mainly due to the introduction of electronic payment methods. With a number of factors such as security, convenience and speed involved, e-payment is an ideal solution for many companies.
Make your corporation tax payments online and avoid the hassle of physical transactions—it is time-saving and convenient!
