Question archive: corporation tax

Are overseas entertaining expenses allowable for corporation tax purposes?

No.

It used to be the case, but no longer.

How much can a limited company pay out in dividends in a year ? Are there any limits or could the Directors of the Board freely decide? What tax would be payable?

Provided the company has sufficient distributable reserves, the directors can pay as many interim dividends as they wish.

If the shareholder is not a 40% tax payer, no further income tax would be due.

I am considering going into the market of buying and selling property, and doing so as a business to convert income tax liability to corporation tax liability. Is it true that the Inland Revenue will not allow a business to enjoy the tax advantages of incorporation if all that business does is buy and sell property ? Also are there CGT implications for a business making profits on property or is it just corporation tax liability?

Property dealing through a company is an acceptable method of conducting such a business.

There are no CGT implications, as CGT is not payable for dealing/trading.

If a director loans it's own company money, what is the amount of tax deductable interest that can be charged?

There isn't a set rate. Iit would need to be a reasonable amount, depending on the circumstances.

Don't forget that the director is taxable on the interest received.

When did payment rules change from 14 days after year-end to 9 months after year-end?

It was changed by s173 FA1996 and applied to APs ending after 31 March 1996.

This page was last reviewed on 07 July 2004.
The information may not reflect changes in legislation made after this date.