If a company's augmented profits are below the APL, how should they proceed?

When a company's augmented profits fall below the Average Profit Level (APL), the company should remain compliant with corporation tax regulations. Maintaining compliance is crucial, as it ensures that the company adheres to legal obligations regarding taxation, even if its profits do not exceed a certain threshold. This compliance can involve submitting necessary tax returns and financial documents, thereby avoiding potential legal issues and penalties that could arise from non-compliance.

Remaining compliant also allows the business to operate transparently and responsibly, fostering trust with stakeholders and regulatory bodies. This step is foundational in maintaining good standing with tax authorities and ensuring that the company is positioned appropriately for growth or for eventual profit increases in the future.

In contrast, simply reassessing the tax classification or shifting business practices may not directly address compliance with tax regulations. Operating without tax submission would be inappropriate and risky, as it could lead to significant penalties or legal consequences.