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SME's to contribute 'lion's share' of 64% corporation tax bill rise in London

London businesses will bear the brunt of a predicted 64% rise in the total corporation tax bill over the next 10 years, according to research carried out by chartered accountants Perrys.

The research, which took into account data from the Office of National Statistics (ONS) and the City of London Corporation, anticipates that the capital’s SMEs will stump up an estimated £18bn in corporation tax bill by 2026.

This figure is taken from the 294,000 businesses currently paying corporation tax in the capital, of which Perrys found that 99% of contributions came from small and medium enterprises.

The predicted rise comes despite the lowering of the corporation tax rate to 18% by the Chancellor, George Osborne, in last summer’s budget.

Stewart Pope, Chief Executive Officer at Perrys Chartered Accountants in Central London, commenting on the research said: “We estimate that small to medium businesses in the capital are paying an average annual corporation tax bill of £37,000 each, which is set to rise to £62,000 each by 2026.”

However, this estimated rise is not all bad news, as much of the higher contributions are a symptom of predicted higher profits for SMEs in the next decade.

Pope explained: “The higher contributions also reflect the increase in profits that businesses are generating, which is a positive indication that the capital continues to remain a great place to do business.”

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