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question 2: I do not understand why the higher rate is applied? I thought as long as the total taxable income is between upper and lower range, the lower is applied?
Can anyone help me?
I don’t know the question you are referring to but for marginal rate companies multiply ttp by 23% then deduct marginal relief
You should look the augmented profit to determined the tax rate not total taxable profit. Be carefual if there is associated companies. If the company has x number of associated company, the upper limit and lower limit should be divided by x+1.
This means
One associated Co, then
Upper limit 1500000.÷2=750000
Lower limit 300000÷2=150000If Two associated, then
U =1500000÷3=500000
L =300000÷3=100000If there is no frank investment income, total taxable profit is augmented profit.
I agree that augmented profit plays a vital role and before calculations the tax rate should be kept in mind. But I would suggest you to take help of any good lawyer who can guide you in a correct way. For more information you can have a look at https://www.mwfloridalaw.com.
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