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Company Taxation 2002

Corporation Tax

Rates

The rate of Corporation Tax on trading income will reduce to 16% for 2002 and 12.5% for 2003

Payment dates

A new Corporation Tax payment system is being introduced.

Up to now, a company must pay Preliminary Tax of 90% within six months of the end of their accounting year. The balance of tax payable is due one month after the Revenue Commissioners issue a notice of assessment for the year.

From 2002 onwards, Companies will have to calculate and pay their annual Corporation tax bill, one month before the end of their accounting year.

The new rules will come in over five years. Up to and including 2005, companies will have to make up to three Corporation Tax payments each year:

1.       The “Current Year Payment” of 20-80% of the final liability, as follows:

2.       90% of the final liability (less the “Current Year Payment”) within six months of the end of the accounting year

3.       Tthe remaining 10% within 1 month of receiving the Notice of Assessment from the Revenue.

By 2006, the full Final Liability must be made in the “Current Year Payment”

In 2002, any company whose 2002 accounting year ends on or before 28 July 2002, must make their  “Current Year Payment” on 28 June 2002. From then on, the new rules apply as above to all companies/

Motor vehicles

The maximum value threshold for business cars (for capital allowances and expenses) is increased from £17,000 to £17,326,  (€21,586 to €22,000)