The change aims to do away with the 400,000 estimated assessments made by the Inland Revenue. With the system applying to all accounting periods ending on or after 1 October, the Revenue has published a guide to how it will operate and is issuing an explanatory leaflet to companies.
Companies will need to file computations of their taxable profits within a strict time-scale and pay corporation tax based on self-assessment.
Price Waterhouse has launched a slim guide called Pay and File: It's Nearer than You Think. It highlights the regime's key features and makes suggestions for preparing the required computations. John Whiting, tax partner at the firm, said: 'A lot of companies are clearly not prepared for the new Pay and File system. Businesses need to ensure they have systems in place capable of producing up-to-date corporate tax data accurately and within the time-scales - or they could be liable for substantial penalties.'
Fellow accounting firm Ernst & Young has produced a more comprehensive book with publishers Kogan Page. 'With such a fundamental change, companies will need to review their systems to ensure they will be able to meet the tighter timetables,' said Charles Watt, tax partner at Ernst & Young. He is also co-author of Pay & File, the Ernst & Young guide to the new corporation tax regime.
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