Suffolk plc’s results for the year ended 31st March 2021 were:
Notes:
On 20th September 2020 Suffolk plc sold a warehouse for £140,000. The warehouse had been purchased in May 2015 for £120,000 and the company had elected to roll over a gain of £40,000 against this acquisition. The indexation allowance arising on the disposal is £6,000.
Suffolk plc owned a 100% owned subsidiary, Norfolk Ltd throughout the period. At 1st April 2020 Norfolk Ltd had trading losses brought forward of £100,000 and had total profits of £40,000 in the year ended 31st March 2021.
Required:
Calculate the corporation tax payable by Suffolk plc for the year ended 31st March 2021, assuming that it makes all available elections to minimise its liability.
(11 marks)
State the date on which the corporation tax calculated in part a) is payable and the form CT600 must be submitted.
(2 marks)
(QUESTION CONTINUES ON NEXT PAGE)
QUESTION 1 (continued)
The managing director of Suffolk plc set up a company, Essex Ltd, of which he is the sole shareholder, in January 2020. Its monthly taxable supplies have been:
|
UK trading profits (before adjusting for items below) |
£750,000 |
|
Debenture interest payable |
£40,000 |
|
Bank interest receivable |
|
|
Received 30th September 2020 |
£5,000 |
|
Accrued interest 31st March 2021 |
£4,500 |
|
Chargeable gains (note i) |
See below |
|
Charitable donation (paid under gift aid scheme) |
£5,000 |
|
January 2020 – April 2020 |
£4,000 |
|
May 2020 – June 2020 |
£6,000 |
|
July 2020 – December 2020 |
£8,000 |
|
January 2021 onwards |
£9,000 |
Required
State the date by which Essex Ltd is obliged to register for VAT and the date from which the registration becomes effective.
(7 marks)
The managing director would like advice on the difference between a mixed supply and a composite and their respective VAT treatments.
Advise the managing director on these matters, giving an example of each.
(4 marks)
Total: 24 marks
