The Big Question - Corporate self-assessment hurts
The new corporate self-assessment system will make tax planning and business management more difficult for small and medium-sized companies, according to a majority of finance directors.
The snub to the Inland Revenue emerged in the latest Accountancy Age/Reed Accountancy Personnel The Big Question comes in the same week that companies with December year ends are due to make their first payments.
Some 46% of finance directors questioned said their tax planning would be more difficult under CTSA. Just 34% of FDs believed CTSA would not hamper forward planning.
Around 10,000 companies, with December year-ends and profits above £1.5m, were due to make tax payments in the first wave of CTSA by yesterday.
Companies are required to make quarterly tax-payment calculations, which will involve calculating profits for six months ahead.
The main concern among FDs was that future profits would be difficult to forecast under the new system.
‘Calculating corporation tax before year end and six months in advance is too much of a guess,’ said Sunil Patel of Ovid Technologies.
Another FD, who asked to remain anonymous, added: ‘CTSA means any estimate within the business has to be fireproof.’
Among those who argued CTSA would create no major problems, Peter Bruasten of Senator Pens, the business gifts retailer, said: ‘The transition has been smooth with no areas for concern.’