Tax and the City review for October 2019

Corporation tax statistics for banks/insurance companies

HMRC published the annual UK corporation tax statistics on 24 September which highlight that banks and insurance companies continue to be a key source of revenue. The finance and insurance sector was the largest single contributor to corporation tax with liabilities of £14.1bn in 2017/18 (26% of corporation tax liabilities). This increase from £12.4bn in 2016/17 was the highest of all sectors. Reasons for this include that banks’ taxable profits have increased and their liability for corporation tax has increased through the bank surcharge of 8% and the loss restriction rules (which have applied to banks since 2016). Bank surcharge receipts have grown every year since they were introduced in 2016 and were £1.9bn in 2018/19 a 5% increase from 2017/18. However...