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Definition
Taxable profit takes your accounting profit and adjusts it for tax purposes: adding back disallowed costs, replacing depreciation with capital allowances, and applying reliefs. Corporation tax is charged on this figure, not on the profit shown in your statutory accounts.
In plain terms
It is why your tax bill rarely equals a flat percentage of the profit you see in your accounts — the taxable figure is a recalculated version.
Why it matters for your company
Understanding the adjustments helps you plan and avoid surprises. See corporation tax explained.
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