Budget

[motorbiking]

yep and I know that "tax paid on profits" is not a good clue of anything.

Company A revenue of £1Bn, Margin of 70%, tax paid on profit zero.
Company B revenue of £1Bn, Margin of 40%, tax paid on profit £75M

There is a long list of things company A could be doing better than Company B. For example reinvesting its profits into growth, routing profit to a low tax zone via a license fee on IP (e.g. Starbucks) . Why do you think most of Europe's high techs were HQ'd in Dublin? Hint. It's not the Guinness.

 

[motorbiking]

meanwhile Rachel from accounts' budget appears to be impacting "working people"

Hospitality chiefs warn Reeves of carnage over Budget tax hikes

Executives from companies including the owner of Slug & Lettuce and Burger King are considering signing a letter to the chancellor warning of "business closures and job losses within a year", Sky News learns.

news.sky.com

 

[ajohn]

A good clue is tax paid on profits.

Which an audit will also show. New kid on the block for me was seeing the accounts of a company I worked for adding a good will value.

 

[ajohn]

meanwhile Rachel from accounts' budget appears to be impacting "working people"

Hospitality chiefs warn Reeves of carnage over Budget tax hikes

Executives from companies including the owner of Slug & Lettuce and Burger King are considering signing a letter to the chancellor warning of "business closures and job losses within a year", Sky News learns.

news.sky.com

Rachel Reeves avoids Liz Truss moment as markets stabilise

Interviews given by Chancellor Rachel Reeves and her number two Darren Jones speaking of a desire to soothe any tremors may have worked, though officially the government says it doesn't comment on market movements.

news.sky.com

 

[JohnD]

...considering...

Well that's pretty decisive.

 

[carmanmemoranda]

yep and I know that "tax paid on profits" is not a good clue of anything.

Company A revenue of £1Bn, Margin of 70%, tax paid on profit zero.
Company B revenue of £1Bn, Margin of 40%, tax paid on profit £75M

There is a long list of things company A could be doing better than Company B. For example reinvesting its profits into growth, routing profit to a low tax zone via a license fee on IP (e.g. Starbucks) . Why do you think most of Europe's high techs were HQ'd in Dublin? Hint. It's not the Guinness.

None of those examples give a proper or full view of any company.

Why do you always just pose 2 options

A proper audit by good accountants tells a fuller story than any snapshot picture

 

[motorbiking]

Ask any business studies student what do company’s like? profit.

What don’t they like to do with thier profits? pay tax on them.

So how do we know which companies are making healthy profits, have great order books and minimising taxes and which companies aren’t? If only investors had formula they could use?

Oh wait they do and it’s not how much tax they pay on profits or the quality of the auditors.

 

[Notch7]

Why do you think most of Europe's high techs were HQ'd in Dublin?

It’s a tax haven

 

[JohnD]

If you complete the first term of your college course, you will learn that "profit" can mean several things.

NBT is a good one to track to see if a company is getting more or less profitable.

A company that has sales of ten million, cost of sales of five million, fixed costs of ten million, with interest payments of five million is not making a profit.

Some dummies think that EBITDA is a measure of profit

It isn't

 

[motorbiking]

Nobody thinks EBITDA is a measure of profit.

JohnD however thinks

A good clue is tax paid on profits.

Which is of no interest to anyone other than the tax man.

NBT is a good one to track to see if a company is getting more or less profitable.

EBT allows you to compare two companies with different tax burdens, not much else.

Net/earnings before tax. doesn't tell you much about a firm in hyper growth mode vs one that is plodding along being outgrown, by its competitors.

 

[motorbiking]

It’s a tax haven

correct or rather it was.

which is why "tax paid on profits." isn't a good clue of anything.

 

[motorbiking]

Well that's pretty decisive.

Looks like it is. 200 warn of drastic job losses.

Hospitality bosses warn Rachel Reeves’ UK tax increases will lead to ‘drastic’ job cuts

More than 200 sign letter to chancellor saying rises in national insurance contributions will cause business closures

www.ft.com

 

[ajohn]

Looks like it is. 200 warn of drastic job losses.

Yes hospitality. The sector where inflation has refused to come down. They have often said they are absorbing their costs increases so are trying to recover profit levels and also accounting for additional inflationary cost increases. Food for instance. Their prices are still increasing due to that. I think it's a little under 5% now but has been steadily higher all along.

The comments often relate to an OBR calculation which takes the taxation take and then converts to working hours. One of the OBR's risk factors that could interfere with their predictions.

A business needs working hours to function so they have a decision to make if they want to carry on trading.

 

[motorbiking]

yep, fewer people working harder for the same money - nice.

 

[JohnD]

Looks like it is. 200 warn of drastic job losses.

People not wanting to pay tax moan about it.

Who could have seen that coming?