As a takeaway owner in the UK, it's important to understand the various taxes that you will be required to pay in order to keep your business compliant.
Failure to pay the correct taxes can result in fines and penalties, so it's important to stay on top of your tax obligations.
In this blog post, we'll take a look at the different types of taxes that takeaway owners in the UK need to be aware of, as well as some tips for staying compliant.
Types of tax restaurant operators should know about in the UK
Value Added Tax (VAT)
Value Added Tax (VAT) is a consumption tax that is added to most goods and services in the UK. If your takeaway has a turnover of more than £85,000, you will be required to register for VAT and charge VAT on your sales. You will also be required to submit regular VAT returns and pay any VAT due to HM Revenue and Customs (HMRC).
Corporation Tax is a tax on the profits of limited companies and some other types of organisations. If your takeaway is a limited company, you will be required to pay Corporation Tax on your profits. This tax is calculated based on the company's profit before tax, and the rate of Corporation Tax is currently 19%.
As a takeaway owner, you will also be required to pay Income Tax on any profits that you earn from your business. The rate of Income Tax depends on your total income, and can range from 20% to 45%. It's important to keep accurate records of your income and expenses, so that you can accurately calculate your Income Tax liability.
National Insurance Contributions
National Insurance Contributions (NICs) are contributions that are made by both employees and employers towards state benefits and pensions. If you employ staff in your takeaway, you will be required to pay NICs for each employee. The rate of NICs depends on the employee's salary, and you will need to register as an employer with HMRC and submit regular returns.
Business Rates are a tax on commercial properties, and are based on the rateable value of the property. If your takeaway is located in a commercial property, you will be required to pay Business Rates to your local council. You can get a reduction on your business rates if your property is considered as small business rate relief or rural rate relief.
If you have employees working in your takeaway, you will be required to pay payroll taxes such as PAYE (Pay As You Earn) and employee NICs. You will need to register as an employer with HMRC, and you will need to submit regular returns and pay any taxes due.
Staying compliant with your tax obligations can be complex, so it's important to work with a tax advisor or accountant who can help you navigate the process. Additionally, keep accurate records of your income and expenses, and be sure to submit all tax returns and payments on time to avoid fines and penalties.
Make tax a priority at your takeaway
As a takeaway owner in the UK, it's important to understand the various taxes that you will be required to pay in order to keep your business compliant. From VAT and Corporation Tax to Income Tax and National Insurance Contributions, there are many different types of taxes that you will need to be aware of.
By working with a tax advisor or accountant and keeping accurate records, you can ensure that your business stays compliant and avoids any fines or penalties.
Please note that this is not professional tax advice and we are not tax advisors. Please consult a professional tax advisor.