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| *Ostroff, Fair and Company>>>Other Taxes |
What is a corporate tax? |
What is a corporate tax? Corporate Taxes are the direct taxes levied by the government. These taxes are given on the dividends a person receives from a company in which he/she has invested. Definitions of Corporate Tax on the Web: * The tax owned by the company according to the tax regulations and its net profit before tax. www.promitheas.com/glossary.ph... * refers to the tax paid by corporates or firms on the incomes they earn. * Corporate tax refers to direct taxes charged by various jurisdictions on the profits made by companies or associations. As a general principle, this varies substantially between jurisdictions. In particular allowances for capital expenditure and the amount of interest payments that can be deducted from gross profits when working out the tax liability vary substantially. Also, tax rates may vary depending on whether profits have been distributed to shareholders or not. ... http://www.google.com/search?hl=en&lr=&r... www.promitheas.com/glossary.ph... www.estart.com/india/finance/b... www.wikipedia.org/wiki/Corpora... A corporate tax is a deduction of a percentage of profits made by companies. The level of taxes vary in different ccountries, and even the amount companies have to pay varies according to the size of companies. In the UK small companies are exempt from tax on the profits below a certain amount (around 拢10,000 I think) and after this amount the corporation tax is ten percent. THink of it as something like income tax for companies and corporations. HM Customs and Revenue If you have a C Corporation, it is the corporation's taxable income multiplied by the applicable tax rates based on the tax tables. Remember though, with C Corporations, any dividends paid to shareholders are taxable as dividends that the shareholder must report on his/her personal return, and the dividends are not deductible as expenses by the C Corporation. That is where the double taxation comes into play. If you have an S Corporation, there is no corporation tax. Instead, the income/loss is passed through to the shareholders, on a Schedule K-1. The shareholder will report this info on his/her personal return (Form 1040) and pay income tax on it. With S Corporations, the shareholders may receive distributions (these aren't taxable to the shareholder as dividends like in C Corporations, but they are not deductible as expenses by the S Corporation). Probably more info than you asked, but hope this helps. |
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