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| Home » Types of Taxes » Corporation |
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Corporation Tax |
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Corporation tax is one of the major types of taxes from which government of a country earns a large amount of revenue. Corporation tax is also known as corporate tax. Actually corporation tax is a term that is mainly used in United Kingdom and corporate tax is used in United States of America. The main basis on which the corporation tax is taken by the government of a country is the profit that is made by various companies that are based in that country. Amount of corporation tax varies according to the jurisdiction under which the company is included.
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In United Kingdom corporation tax also includes the major assets that are owned by a company. Although financial leases do not fall under this category. Imputation system was once also an integral part of corporation tax system. This system has been begun in UK from the year 1973. This system was continued up to the year 1999. Advance Corporation Tax (ACT) is also an important part of corporation tax in this country.
The rate of Corporate tax in United States of America is 35% of the total profit of a company. This rate is one of the highest rates of taxes that are paid in the whole world. “Checking the box” system in USA is very important as far as the corporation tax is concerned. This is a system that was started here so that the companies can avoid the problem of double taxes. There is a pass through facility in this system and therefore all the companies in the United States have developed a lot.
There are corporation taxes in all the developed countries throughout the whole world. Among these countries the mentionable ones are Bulgaria, Hungary, Slovakia, Poland, Ireland, Iceland and many others as well. Organization for Economic Co-operation and Development is situated in all these countries and function of this organization is basically to control the amount of corporation tax.
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