What is company tax, how is it calculated and how does it differ from PAYE?
Company tax is tax levied on company profits. It is calculated by taking into account all income (turnover) generated by a company and deducting business expenses that the company has incurred. Company tax is imposed at the following rates for the following categories of companies:
- Manufacturing companies 10%
- Commercial Farming 10%
- Non – Manufacturing companies 25%
As opposed to company tax, PAYE is tax on an individual’s salary/earnings. PAYE is imposed to the individual earnings using marginal rates of 20% and 30% and the personal Tax Credit which is granted under PAYE, but it is not granted under company tax.