2018 Results and Tax
Last updated
Last updated
We have been successfully accredited for the Fair Tax Mark for this financial year.
On this page we'll share our financial and company information for the year, for full transparency.
In September 2017, our forecast for the year was:
Turnover: £405,523
Profit before tax: £74,521
However, during the year we re-evaluated our business plan as Brexit, and political uncertainty around preparation for it, began to impact the UK economy, We decided as a team to cut back re-investment in growth in terms of recruitment, marketing and so on. We also decided to take on a larger than normal amount of work, but with the existing team. The intention was to focus on achieving a higher profitability to enable uis to grow our cash reserve, ready to be able to weather the economic impact in 2019.
The final results for the year ending 30 Sept 2018 were:
Turnover: £470,363
Profit before tax: £114,187
So we did better than forecast, and did succeed in growing our cash reserve in preparation for potential problems in the economy in 2019.
The director of the company was paid £52,292 salary in this financial year, all as PAYE.
Given our work in the digital sector we undertake research and development projects for ourselves, and our clients.
The government incentivises and rewards R&D to foster innovation using a system of tax credits managed by HMRC. Each year we submit a report on the projects we have done, the R&D elements of those, the staff time spent on them, and any resulting outputs. That report is then assessed and we are awarded a certain level of tax credit, which is calculated as a percentage of the staff time and other costs we have invested in the R&D.
This year, staff time and costs worth £70,072 was spent on R&D related work. This resulted in us being granted an R&D tax credit of £13,314.
Our R&D work included
Investigating machine learning and natural language processing to extract entity and term metadata from government research reports to aid searchability and sharing.
Investigating and prototyping approaches to conducting large scale load tests on government services in which authenticated users need to work through multi-step processes.
You can view some of the outcomes from our R&D on our blog, and in our Github repositories. We are working on publishing and releasing more of it.
The company made a profit, so the headline rate of corporation tax in this financial year is 19%. We were granted Research and Development Tax credits of £13,314 in this preiod for research work undertaken.
The Corporation Tax incurred by the company in this financial year was therefore calculated as:
Tax charge and adjustment details
£
%
Profit before tax
114,187
Corporation tax on profits before tax
21,696
19.0%
R&D Tax Credit relief
-13,314
-11.7%
Capital allowances in excess of depreciation
-1,833
-1.6%
Expenses not deductible for tax purposes
725
0.6%
Adjustment to tax charge in prior year
129
0.1%
Current Tax
7,403
6.5%
Deferred taxation
1,827
1.6%
Taxation as per the financial statements
9,230
8.1%
The net tax charge of £7,403 on a profit before tax of £114,187 gives an effective tax rate of 6.5% compared to the standard rate of 19%. The main reason for this difference between the current rate and the standard rate is the Research and Development ('R&D') tax credit. This is a government incentivises and rewards R&D to foster innovation using a system of tax credits managed by HMRC. Other factors effecting the tax charge are, capital allowances in excess of depreciation and expenses that do not qualify for tax relief (i.e. client entertaining).
The deferred taxation has arisen due to a timing difference in the purchase of fixed assets, where the tax relief has been claimed in full in the year of purchase and not when depreciation has been charged to the profit and loss account. The depreciation policy is 20% straight line.
The company and our team paid £82,172.24 of PAYE/NIC to HMRC in this financial year.
The company raised £88,404 of VAT on behalf of HMRC in this financial year.
Therefore, the overall contribution in UK taxes generated as a result of our business activities was £179,806.24.
Our full accounts are available to view here:
