Navigating tax for small businesses can be challenging, especially if your business is growing rapidly. Understanding the different taxes you need to pay is crucial to avoid costly mistakes. Whether you’re a sole trader, in a partnership, or running a private limited company, it’s essential to know your tax obligations to keep your business on track. Here’s a comprehensive guide from Countify, your trusted accountants in Glasgow, to help you understand what you need to know about tax for small businesses in the UK.

Taxes for Sole Traders

As a sole trader, you are required to pay income tax on profits exceeding £12,500 (current rates). Additionally, National Insurance contributions are mandatory if your business profits exceed £6,363. The amount you pay will increase as your profits grow. It’s important to stay informed about the thresholds and rates to ensure compliance.

Taxes for Partnerships

In a partnership, each partner is responsible for paying income tax on their share of the profits once they exceed the £12,500 threshold. National Insurance contributions are also required, depending on individual earnings. Partnerships require careful planning and accurate accounting to manage tax obligations effectively. Countify, a leading firm of accountants for small businesses, can help you manage these complexities.

Taxes for Private Limited Companies

If you operate as a private limited company, you must pay corporation tax on your company’s profits. The current rate is 19%, though there were plans to reduce this to 17% in 2020, which have since been put on hold. Accurate calculation and timely payment of corporation tax are essential to avoid penalties. Our small business accountants can assist you in managing corporation tax efficiently.

VAT Obligations

Your business must register for VAT if your annual VAT taxable turnover exceeds £85,000. This threshold includes everything you sell that is not VAT exempt. Once registered, you’ll receive a VAT number and an effective date of registration. From this date, it’s your responsibility to keep accurate records, charge the correct VAT amount, pay VAT to HMRC, and submit VAT returns on time.

Importance of Hiring a Small Business Accountant

Tax for small businesses in the UK is governed by numerous rates and regulations, making it easy to make costly mistakes. This is where hiring a small business accountant becomes invaluable. Accountants for small companies like Countify offer expert advice, ensuring you stay compliant while focusing on growing your business.

How Countify Can Help

At Countify, we understand the unique challenges small businesses face, particularly when it comes to tax. Our team of accountants for small businesses in Glasgow is here to provide tailored advice and services that meet your specific needs. Whether you need help with income tax, National Insurance, corporation tax, or VAT, our experienced team is here to guide you every step of the way.

We offer a wide range of services, from bookkeeping and tax planning to full financial management, ensuring your business stays on the right path. If you’re looking for reliable accountants for small business owners who understand the intricacies of tax for small businesses in the UK, Countify is here to help.

Contact Us

For more information on our tax services or to schedule a consultation, please contact us at [email protected] or visit our website at https://countify.co.uk/.

3rd Floor, St. Georges Building, 5 St. Vincent Place, Glasgow, G1 2DH

Phone: 0141 275 4860

Email: [email protected]