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CELE SQE1 模拟练习

Examination Timing: 00H04M35S

GreenTech Ltd, a private limited company, has an accounting period from 1 April 2021 to 31 March 2022. During this period, it earned trading receipts of £500,000. The company also made a gain from the sale of a piece of land amounting to £150,000. GreenTech Ltd spent £75,000 on raw materials, £400,000 on wages, and £5,000 on general production costs. The corporation tax rate is 19%. 

What is the company's corporation tax liability?

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To calculate the corporation tax liability, first determine the net trading profit by subtracting deductible expenses from the gross trading receipts. Deductible expenses include raw materials, wages, and general production costs. Net trading profit: £500,000 - (£75,000 + £400,000 + £5,000) = £20,000. Add the gain from the sale of land: £20,000 + £150,000 = £170,000. The corporation tax is calculated at 19% of the total taxable profit: £170,000 x 19% = £32,300. Therefore, the company's corporation tax liability is £32,300. 

Key Point: The calculation of corporation tax liability involves determining net trading profit and adding other taxable gains, then applying the applicable tax rate.



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