Deduction of tax from interest
|Category|| Technical Articles
Article by David Bertram, director, Clayfield Professional Guidance Ltd. This article appeared in the June 2005 issue of Tax Adviser. To deduct tax from interest or not to deduct tax from interest – that is the question!
For many years, the instinctive answer to the question: ‘Should I deduct income tax from interest paid by a company?’ would have been ‘yes, probably’. Indeed, it has been a basic principle that, wherever possible, tax should be deducted and paid over at source.
This article looks at issues relating to the deduction or non-deduction of income tax from annual interest paid or received by companies and certain other bodies resident in the UK.
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