How Corporation Tax is calculated from your Xero records
The quality of your bookkeeping affects the accuracy of your Corporation Tax return
Your Corporation Tax liability is calculated from the figures in your annual accounts, which are themselves based on your Xero records. The quality of your bookkeeping directly affects the accuracy of your Corporation Tax return.
From Xero to CT600
We take your Xero profit and loss figure as the starting point. We add back non-allowable expenses (e.g. client entertainment, depreciation, personal costs). We deduct capital allowances on asset purchases. We apply any loss relief from prior years. The result is your taxable profit, to which we apply the appropriate Corporation Tax rate.
Why clean Xero records matter
Every miscoded transaction affects the starting profit figure. An expense coded to the wrong account may be non-allowable. A sale not invoiced is missing from income. The CT600 is only as accurate as the underlying accounts.
💡 Good to know: We do not file your CT600 based on Xero figures alone. We review the accounts, make year-end adjustments, prepare the formal statutory accounts, and then build the CT600 from those reviewed accounts. The process typically takes two to four weeks after we have all the information from you.
Not found what you're looking for?
Please get in touch and we'll be happy to help:
Email: You can submit a request using our contact form
Phone: 020 3897 2233
Live Chat: Select the live chat icon on the bottom right