As a business owner, paying taxes may slip your mind when you are preoccupied with the company’s short and long-term objectives. Nevertheless, you need to be aware of what taxes you must pay and when the taxes are due. You should note that with most taxes, you will not receive any form of bill. Therefore, the onus is on you to find out what the law requires you to pay, otherwise, you risk facing penalties for not paying business taxes. This article will explain four types of taxes that you will pay when running an SME. <\/p>\n\n\n\n
All companies that work and operate in the UK must pay corporation tax. You pay corporation tax as a percentage of all profits your business makes, including the income generated through investments or the sale of assets<\/a>.<\/p>\n\n\n\n Notably, you will not receive a bill for this tax. Instead, you must:<\/p>\n\n\n\n As a business owner, the personal income you pay yourself from your business is subject to income tax. The amount of income tax you owe is based on how much you earn. Notably, you will only receive a bill after you have filed your tax return. <\/p>\n\n\n\n The income tax you pay will differ depending on your company structure. <\/p>\n\n\n\n\n
2. Income Tax<\/h2>\n\n\n\n
Company Structure<\/strong><\/td> Tax Implications<\/strong><\/td><\/tr> Limited Companies<\/a><\/td> If you have structured your business as a limited company, you will pay income tax through your business’s PAYE (Pay As You Earn) scheme as an employee of the business. Otherwise, any contractors will be liable to pay their own income tax. <\/td><\/tr> Sole Traders<\/a><\/td> If you run the business as a sole trader, you must complete a self-assessment tax return to pay your income tax. You will have a personal income tax-free allowance of \u00a312,570. You must complete a self-assessment tax return even if your earnings fall under this threshold. <\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n\n\n Continue reading this article below the form\n <\/i>\n<\/a>\n