corporation tax

corporation tax,

imposts levied by federal, state, or local governments against corporations, their income, or their peculiar attributes, such as charters, capitalization, dividends, and franchises. In the United States such taxes were brought about by the difficulty of taxing corporate bonds and stocks and by the growth of corporations beyond state bounds, with consequent difficulty of assessment and taxation. Such special state corporation taxes now include fees and licenses for incorporation or for an increase in capitalization or for filing the corporation's charter in another state; taxes on gross earnings; taxes on tonnage and financial instruments or transactions; franchise taxes; capital stock taxes; and net income taxes. In 1909 the federal government imposed an excise tax on net incomes of U.S. corporations. That tax was superseded by a corporation income taxincome tax,
assessment levied upon individual or corporate incomes. Although personal incomes were occasionally taxed in medieval Italian cities, the income tax is essentially a modern form of taxation.
..... Click the link for more information. after the Sixteenth Amendment (1913). In Great Britain in 1920 a tax was levied on corporations, including foreign companies of limited liability doing business in Great Britain, but exempting the profits of corporations receiving income from other corporations already taxed. In both the United States and Great Britain, excess profits taxexcess profits tax,
levy on any profit above a standard level. Chiefly a wartime phenomenon, it is intended to increase revenue during periods of distress and to prevent businessmen from taking unfair advantage of the increased government spending and consumer demand that
..... Click the link for more information. has generally been imposed only during wartime.

Bibliography

See S. Réamonn, The Philosophy of the Corporate Tax (1970); H. Nurnburg, Cash Movements Analysis of the Accounting for Corporate Income Taxes (1971).

corporation tax

a tax on the worldwide profits of UK resident companies and on the profits of non-resident companies from trading operations in the UK. Profits are measured for accounting periods and include both income and capital profits. In broad terms, income is measured using income tax principles and capital profits are calculated using capital gains tax principles but with INDEXATION ALLOWANCE instead of TAPER RELIEF. The rates of corporation tax vary according to the level of profits and are set for each FINANCIAL YEAR ending on 31 March with the accounting period profits apportioned where that period does not end on that date. Special rules apply to groups of companies to permit losses of one group member to be surrendered to another and for capital assets to pass within the group without triggering a disposal for CAPITAL GAINS TAX.

corporation tax

Corporate Tax

A tax levied on corporations' profits. Because corporations are legal entities separate from their owners, they may be taxed as if they were persons. A corporate tax, then, is the equivalent of the income tax for natural persons. Corporate taxes vary from country to country; in the United States, they are levied at both the federal and state levels. Proponents of the corporate tax argue it guards against excessive profits that may result from unethical or illegal corporate practices, while opponents say that corporations simply pass on the tax to their customers.

corporation tax

a DIRECT TAX levied by the government on the PROFITS accruing to businesses. A company's corporation tax is loosely based upon its profit for the accounting period as determined in the COMPANY'S PROFIT-AND-LOSS ACCOUNT. However, since firms use different methods for calculating DEPRECIATION of FIXED ASSETS to charge against revenues and so arrive at different PROFIT figures, the UK government establishes a standard scale of CAPITAL ALLOWANCES which all firms must apply to their fixed assets when computing taxable profit.

When a company pays dividends or makes other distributions of profit to shareholders, then it must also make a payment of advance corporation tax to the government, currently equal to one third of the dividend paid. This is an advance payment of corporation tax and can be offset by the company against its liability to mainstream corporation tax when this liability is assessed at the year end. Shareholders receiving a dividend are also treated as receiving a tax credit equal, at current rates, to one third of the dividend received. This tax credit is added to the dividend received to establish the shareholders' total taxable income. This imputation system, whereby the tax paid on distributed profits by the company is credited to the shareholders, avoids double-taxing the shareholders both on their company's profits and on their dividend distributions.

In the UK (as at 2005/06) the general corporation tax rate is 30% of taxable profits per annum, but there is also a ‘smaller companies’ corporation tax rate. No tax is payable on taxable profits up to £10,000 per annum and 19% on taxable profits over £10,000 up to a maximum of £300,000 per annum.

The level of corporation tax is important to a firm insofar as it determines the amount of aftertax profit which is available to it to pay out DIVIDENDS to shareholders or to reinvest in the business (see RETAINED PROFITS). See INLAND REVENUE.

corporation tax

a DIRECT TAX levied by the government on the PROFITS accruing to businesses. The rate of corporation tax charged is important to a firm insofar as it determines the amount of aftertax profit it has available to pay DIVIDENDS to shareholders or to reinvest in the business. In the UK currently (as at 2005/06) the general corporation tax rate is 30% of taxable profits per annum, but there is also a smaller companies’ corporation tax. No tax is payable on taxable profits up to £10,000 per annum and 19% on taxable profits over £10,000 up to a maximum of £300,000 per annum. See TAXATION, FISCAL POLICY, RETAINED PROFIT.

单词	corporation tax
释义	corporation tax corporation tax n (Government, Politics & Diplomacy) a British tax on the profits of a company or other incorporated body Translations corporation tax corporation tax, imposts levied by federal, state, or local governments against corporations, their income, or their peculiar attributes, such as charters, capitalization, dividends, and franchises. In the United States such taxes were brought about by the difficulty of taxing corporate bonds and stocks and by the growth of corporations beyond state bounds, with consequent difficulty of assessment and taxation. Such special state corporation taxes now include fees and licenses for incorporation or for an increase in capitalization or for filing the corporation's charter in another state; taxes on gross earnings; taxes on tonnage and financial instruments or transactions; franchise taxes; capital stock taxes; and net income taxes. In 1909 the federal government imposed an excise tax on net incomes of U.S. corporations. That tax was superseded by a corporation income taxincome tax, assessment levied upon individual or corporate incomes. Although personal incomes were occasionally taxed in medieval Italian cities, the income tax is essentially a modern form of taxation. ..... Click the link for more information. after the Sixteenth Amendment (1913). In Great Britain in 1920 a tax was levied on corporations, including foreign companies of limited liability doing business in Great Britain, but exempting the profits of corporations receiving income from other corporations already taxed. In both the United States and Great Britain, excess profits taxexcess profits tax, levy on any profit above a standard level. Chiefly a wartime phenomenon, it is intended to increase revenue during periods of distress and to prevent businessmen from taking unfair advantage of the increased government spending and consumer demand that ..... Click the link for more information. has generally been imposed only during wartime. Bibliography See S. Réamonn, The Philosophy of the Corporate Tax (1970); H. Nurnburg, Cash Movements Analysis of the Accounting for Corporate Income Taxes (1971). corporation tax corporation tax a tax on the worldwide profits of UK resident companies and on the profits of non-resident companies from trading operations in the UK. Profits are measured for accounting periods and include both income and capital profits. In broad terms, income is measured using income tax principles and capital profits are calculated using capital gains tax principles but with INDEXATION ALLOWANCE instead of TAPER RELIEF. The rates of corporation tax vary according to the level of profits and are set for each FINANCIAL YEAR ending on 31 March with the accounting period profits apportioned where that period does not end on that date. Special rules apply to groups of companies to permit losses of one group member to be surrendered to another and for capital assets to pass within the group without triggering a disposal for CAPITAL GAINS TAX. corporation tax Corporate Tax A tax levied on corporations' profits. Because corporations are legal entities separate from their owners, they may be taxed as if they were persons. A corporate tax, then, is the equivalent of the income tax for natural persons. Corporate taxes vary from country to country; in the United States, they are levied at both the federal and state levels. Proponents of the corporate tax argue it guards against excessive profits that may result from unethical or illegal corporate practices, while opponents say that corporations simply pass on the tax to their customers. corporation tax a DIRECT TAX levied by the government on the PROFITS accruing to businesses. A company's corporation tax is loosely based upon its profit for the accounting period as determined in the COMPANY'S PROFIT-AND-LOSS ACCOUNT. However, since firms use different methods for calculating DEPRECIATION of FIXED ASSETS to charge against revenues and so arrive at different PROFIT figures, the UK government establishes a standard scale of CAPITAL ALLOWANCES which all firms must apply to their fixed assets when computing taxable profit. When a company pays dividends or makes other distributions of profit to shareholders, then it must also make a payment of advance corporation tax to the government, currently equal to one third of the dividend paid. This is an advance payment of corporation tax and can be offset by the company against its liability to mainstream corporation tax when this liability is assessed at the year end. Shareholders receiving a dividend are also treated as receiving a tax credit equal, at current rates, to one third of the dividend received. This tax credit is added to the dividend received to establish the shareholders' total taxable income. This imputation system, whereby the tax paid on distributed profits by the company is credited to the shareholders, avoids double-taxing the shareholders both on their company's profits and on their dividend distributions. In the UK (as at 2005/06) the general corporation tax rate is 30% of taxable profits per annum, but there is also a ‘smaller companies’ corporation tax rate. No tax is payable on taxable profits up to £10,000 per annum and 19% on taxable profits over £10,000 up to a maximum of £300,000 per annum. The level of corporation tax is important to a firm insofar as it determines the amount of aftertax profit which is available to it to pay out DIVIDENDS to shareholders or to reinvest in the business (see RETAINED PROFITS). See INLAND REVENUE. corporation tax a DIRECT TAX levied by the government on the PROFITS accruing to businesses. The rate of corporation tax charged is important to a firm insofar as it determines the amount of aftertax profit it has available to pay DIVIDENDS to shareholders or to reinvest in the business. In the UK currently (as at 2005/06) the general corporation tax rate is 30% of taxable profits per annum, but there is also a smaller companies’ corporation tax. No tax is payable on taxable profits up to £10,000 per annum and 19% on taxable profits over £10,000 up to a maximum of £300,000 per annum. See TAXATION, FISCAL POLICY, RETAINED PROFIT.
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