# Corporate tax rate

The **Corporate Tax Rate** represents the percentage of tax your organisation pays on the **interest earned** from your maintenance fund.

This setting ensures that your maintenance plan reflects the *net* growth of the fund after tax deductions, providing a more accurate closing balance projection.

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## How it works

Each year, the system calculates interest on your maintenance fund using the **Interest Rate on Funds**.  
The **Corporate Tax Rate** is then applied to that interest amount to determine how much tax is deducted before it’s added to your balance.

**Example:**

- Fund opening balance: **$50,000**
- Interest rate: **2%** → Interest earned: **$1,000**
- Corporate tax rate: **28%**
- Tax deducted: **$280**
- Net interest added to fund: **$720**

This ensures that the growth of your maintenance fund matches what you would actually expect after taxes are paid.

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## Updating the tax rate

You can update the corporate tax rate at any time to reflect your organisation’s current tax obligations.  
As with other financial settings, any change affects **future calculations only** — past years that have already been approved remain unchanged.

Keeping this rate accurate ensures that your plan’s **closing balance** and **fund growth** projections remain realistic.

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## Summary

- The corporate tax rate is applied to **interest earned** from your maintenance fund.
- It ensures your **closing balance** reflects **net (after-tax)** growth.
- Updating the rate affects **future projections** only.
- This setting helps maintain an accurate and compliant financial forecast.