I never seem to have enough money to pay my corporation tax – why?
Do you get to that dreaded date each year when your corporation tax bill is due for payment but you don’t have enough money in the bank to pay it?
Or, do you get your accounts back from your accountant only to find out that you have drawn too much money out of the business and not saved enough to cover the tax bill when the time comes?
If you have a limited company, the chances are that you will have to pay corporation tax on the profits the company makes.
But with everything else that you have to think about when running a small business, you may let it slip your mind.
Lots of business owners seem to get a surprise when the tax bill comes around for payment. That’s because they haven’t planned for it in advance or even thought about how much it might be.
If that’s you, then you could do with some cash flow planning.
The easiest way to fix the problem is to open a tax savings account and put away the money you will need for your tax bill every month. Ask your accountant for a rule of thumb on how to calculate how much you need to put away. Once it’s in the savings account, forget about it and pretend it’s not there – it’s not yours after all!
If you would like some help with this or to have a chat with us then why not get in touch.