ABSTRACT
Solicitors are better placed to give advice where they have a knowledge of how business profits are calculated and where they understand the nature of tax reliefs and allowances that can be claimed by businesses. An awareness of the types of profit and the types of accounting information that is produced will support solicitors in fulfilling their roles; this applies to accounting information that is used for statutory as well as commercial purposes. This chapter looks at how business profits are calculated, and consideration is given to the types of profit that can be identified in businesses. The chapter explores what allowances can be claimed to offset against tax liabilities as well as consideration of tax relief in the event of a business being loss-making. Accounting systems and the information that is produced from them along with the purposes of that information are explained.
