Income tax or Capital gains tax?

eduino · Apprentice Joined: 15 Sep 2007 Posts: 5

Hello, I’m just a beginner in business. I’m starting a small company, actually it’s not a real company but a home based lawyers’ office. I’d like to employ an assistant, too. That’s only for start; we’ll expand certainly in a couple of years. So, what do you think, will I be subjected to paying income tax or capital gains tax?

thomasin · Apprentice Joined: 13 Jan 2007 Posts: 6

An individual pays an income tax, and the whole income is taxed, but with capital gains tax or capital income tax only the difference between the total receipts and expenses which include write-offs, which is the net income, is taxed. That is the main difference. So, companies pay corporate income tax. And the problems is that you’ll have to register the office first and what you’ll pay depends mostly on that. I’m not much familiar with all this as you aren’t, but I’ll try to help. I mean I’m not familiar with opening lawyers or similar offices and clinics, but you’ll definitely find an answer here on this forum. In my opinion you’ll have to pay income tax.