Disallowable Expenses for Corporation Tax
Understanding the rules around disallowable expenses for Corporation Tax is a necessary aspect of the successful, compliant running of your business. Calculating your company’s Corporation Tax liability can, however, be complex: what is a disallowable expense for Corporation Tax and what expenses are not permitted?
At Perrys Chartered Accountants, our expert team of Corporation Tax specialists are highly skilled and experienced in all aspects of Corporation Tax and the execution of company accounts. We are here to ensure that you keep your Corporation Tax liability to a minimum, whilst making certain that all aspects of your accounting are correct and compliant.
To assist you in understanding disallowable expenses for Corporation Tax, we have compiled this guide to make it easier for you to ascertain your Corporation Tax liability. Of course, if you have any further questions regarding your company’s requirements in any aspect of accounting, please do not hesitate to get in touch with the team at Perrys Chartered Accountants. We are always happy to assist you in any way we can.
Other Disallowable Expenses for Corporation Tax
Accrued Wages
Bonuses and other wages accrued in the accounts are permitted as a Corporation Tax deduction as long as the amount is paid to the employee within 9 months of year end
Repairs
Expenditure incurred on repairing items used specifically for the business, such as redecorating the office or fixing a broken machine, are allowable deductions so long as there is no major enhancement of the item.
Customer Debts
If a debt is no longer recoverable, then a deduction may be allowed. This only applies to specific customer debts, so it’s worth checking with us if you are unsure.
What cannot be claimed as a Corporation Tax deduction?
These are the main expenses for which a Corporation Tax deduction is not permitted:
- Certain legal fees
- Clothing
- Depreciation
- Client entertainment
- Certain business gifts
- Accrued pension contributions
- Fines and penalties
- Car lease costs
There may be others which need to be taken into account. Please check with the team at Perrys Chartered Accountants in London or Kent regarding any item not specifically listed or anything else you may be unsure about.
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