With many businesses approaching the end of the accounting period’s final quarter (31st March), this is a perfect opportunity to review your employer pension contributions. For the contributions to be deductible against corporation tax, they must be paid on or before 31st March.
From 1 April 2023, the headline (i.e. main) corporation tax rate increased to 25% for taxable profits over £250,000. This change was introduced initially in the 2021 Spring Budget, which saw a new approach to corporation tax. The 2022 mini-Budget reversed these changes, yet were then reinstated. Consequently, the changes to corporation tax are as originally planned.
Even if your company doesn’t have a 31st March year-end, PK Group recommend that you talk to a Financial Adviser about your corporation tax bill. Our advisers may be able to help you reduce your corporation tax bill by maximising your pension allowance and helping you plan for retirement.
In general terms, employer contributions have been considered as a tax efficient way to fund retirement. With the new corporation tax and increased tax burdens on those receiving dividends, now is a perfect opportunity to ensure you plan how to keep as much of your hard-earned profit as possible.
We at PK Group are more than happy to help you with any questions you may have. You can contact us at welcome@pkgroup.co.uk or via +44 (0)20 8334 9953
