November 11, 2023

How Incorporating A Company In UK Can Maximize Your Tax Benefits

Lower Corporate Tax Rates

The corporate tax rate in the UK stands at 19%, a notably lower figure compared to various other nations. In the United States, the corporate tax rate is 21%, and in France, it is 28%. Opting to establish a company in the UK presents an opportunity to benefit from these reduced tax rates, ultimately leading to a decrease in the overall tax burden.

Tax Deductible Expenses

When you establish your business, it attains a distinct legal identity, enabling you to subtract specific costs from your taxable income. Through this deduction, you can lower your total tax obligation, contributing to a reduction in your overall tax liability.

Value Added Tax (VAT)

If your business is VAT registered, you have the opportunity to reclaim VAT on your business expenses. Furthermore, if your business engages in the export of goods or services outside the EU, you may qualify for zero-rated VAT, offering additional tax advantages.

Research and Development (R&D) Tax Credits

The UK government provides tax credits to businesses engaging in Research and Development (R&D). These credits can either be utilized to reduce corporate tax liability or, in cases where a business has no taxable profits, received as a cash payment.