UK Tax Services
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For our customers who want to establish a company in the United Kingdom and do not need a physical office, you can benefit from our legal office address and document tracking services by registering your business in central London.
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The United Kingdom is globally recognized for its investor-friendly and advanced tax system. The tax system covers a wide range of income and earnings categories, from individuals to businesses. Below is a comprehensive guide to the UK tax system.
Income Tax
Income tax is levied on individuals’ annual income. Income sources include salaries, self-employment earnings, rental income, and investment returns.- Tax Bands (2023/24 Tax Year):
- Personal Allowance: Income up to £12,570 is tax-free.
- Basic Rate: 20% on income between £12,571 and £50,270.
- Higher Rate: 40% on income between £50,271 and £125,140.
- Additional Rate: 45% on income above £125,141.
- Special Allowances: Childcare benefits, pension contributions, and specific donations can be deducted from taxable income.
Value Added Tax (VAT)
VAT applies to most goods and services in the UK.- Standard Rate: 20%
- Reduced Rate: 5% (e.g., for domestic energy bills and child car seats).
- VAT-Exempt Products: Services in sectors such as food, education, and healthcare are VAT-exempt.
Corporation Tax
Companies operating in the UK pay corporation tax on their profits.- 2023 Corporation Tax Rates:
- 19% for businesses with annual profits up to £50,000.
- Gradual rates for profits between £50,001 and £250,000.
- 25% for profits above £250,000.
Capital Gains Tax
Capital gains tax applies to profits from the sale of assets by individuals or companies.- Capital Gains Tax for Individuals:
- Personal exemption: £6,000.
- Basic rate: 10% (18% for residential property sales).
- Higher rate: 20% (28% for residential property sales).
- Capital Gains Tax for Companies:
- Companies include capital gains in their corporation tax returns.
Stamp Duty Land Tax (SDLT)
Stamp duty is levied on property purchases in the UK.- Standard Rates:
- No tax on purchases up to £250,000.
- 5% on purchases between £250,001 and £925,000.
- 10% on purchases between £925,001 and £1,500,000.
- 12% on purchases over £1,500,001.
Inheritance Tax (IHT)
Inheritance tax is applied to assets left to beneficiaries upon an individual’s death.- Tax Exemption: No tax on assets up to £325,000.
- Tax Rate: 40%.
- Assets left to spouses or charities are generally exempt from inheritance tax.
Tax Filing and Payment Processes
- Self-Assessment System: Individuals and self-employed persons file their annual income tax returns online.
- Corporate Declarations: Companies submit corporation tax returns after completing their fiscal year.
- Payment Deadlines: Taxes must be paid by specific deadlines each year.
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