Corporation tax

2026/27

Corporation tax — bands and rates
Band	Rate	Notes
Up to £50,000	19%	Small profits rate
£50,001 – £250,000	26.5%	Marginal relief band
Over £250,000	25%	Main rate

2025/26

Corporation tax

Corporation tax — bands and rates
Band	Rate
Up to £50,000	19%
£50,001 – £250,000	26.5%
Over £250,000	25%

Corporation tax for companies

Companies pay corporation tax on their taxable profits. A small-profits rate applies below a lower limit, the main rate above an upper limit, and marginal relief smooths the rate in between. Returns and payment are due after the accounting period ends. The tables above show the current rates.

Planning — around timing, allowances, salary versus dividends and reliefs like R&D — can reduce the bill legitimately. Our compliance service files accurate company accounts and tax returns.

When the tax is actually due

For most small companies corporation tax is payable nine months and a day after the year end — before the filing deadline for the return, which is twelve months. Those two dates being different is the single most common source of interest charges we see: the company waits for the return to be finished and pays late without realising.

Quarterly instalment payments

Above a profit threshold the timetable changes completely. Tax becomes payable in quarterly instalments, and the first falls due during the accounting period itself — months before anyone has prepared the accounts that calculate the figure. It has to be estimated, and revised as the year goes on.

The threshold is divided between associated companies, so a group of modest companies under common control can be caught where none of them looks close on its own. Crossing it for the first time is a cash-flow event before it is a tax one, and it is one of the few things worth forecasting a year ahead.

Marginal relief

Between the small profits rate and the main rate there is a band where marginal relief applies, producing an effective rate higher than either. Profits in that band are unusually expensive, which is what makes the timing of income and of capital purchases worth planning around the year end.

Frequently asked

When is corporation tax due?+

Payment is normally due nine months and one day after the end of your accounting period, with the return due twelve months after. Larger companies pay in instalments.

How can I reduce corporation tax?+

Through capital allowances, the right salary/dividend mix, pension contributions, R&D relief where applicable and good timing. We plan this with you.

When does corporation tax have to be paid quarterly?+

Above a profit threshold, which is shared between associated companies — so a group of small companies under common control can be caught where none looks close alone. The first instalment falls due during the accounting period, before the accounts that work out the figure exist, so it has to be estimated and revised.

Is the payment deadline the same as the filing deadline?+

No, and assuming so is a reliable way to pay interest. For most small companies the tax is due nine months and a day after the year end; the return is not due until twelve months. Waiting for the return before paying means paying late.

What is marginal relief?+

A taper between the small profits rate and the main rate. Profits inside that band carry an effective rate higher than either headline figure, which is why moving a capital purchase or a bonus across the year end can be worth more there than anywhere else.