Corporation Tax Calculator
Estimate what your company owes.
Since April 2023, corporation tax isn’t a single rate. Smaller profits still pay 19%, bigger ones pay 25%, and profits in between get marginal relief. This calculator handles all three cleanly.
Last updated Written by Greg Hanton, Co-founder
Quick reference
How the two rates (and marginal relief) work.
The band depends on your taxable profit and how many companies you control.
-
Small profits rate
19%
Applies to taxable profit up to £50,000.
-
Main rate
25%
Applies to taxable profit of £250,000 or more.
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Marginal relief band
£50k–£250k
Profit in this range taxed at an effective rate between 19% and 25%.
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Marginal relief fraction
3/200
The standard fraction used for the 2026/27 tax year.
-
Associated companies
Shared
Thresholds are divided by the number of associated companies.
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Payment deadline
9m + 1d
Corporation tax is due nine months and one day after year-end.
Rates and thresholds are set out in the Finance Act 2021 and have applied since 1 April 2023.
Calculation result
Total corporation tax due
£—
Where the tax comes from
Accounting period
—
- Net profit (turnover − expenses)
- —
- Pre-April 2023 (— days)
- £—
- at 19%
- £—
- Post-April 2023 (— days)
- £—
- at —%
- £—
- Total corporation tax
- £—
due by —
You’ve shown a loss. No corporation tax is due for this year. Losses can usually be carried forward to offset future profits, reducing your tax bill in profitable years.
Marginal relief applied. Your profit falls inside the marginal-relief band, so the effective rate sits between 19% and 25%. Pension contributions and other timing strategies can pull profit back under the small-profits threshold and lock in the 19% rate.
Bands divided across — companies. The standard £50,000 and £250,000 marginal-relief thresholds are split across all associated companies, so for your setup the small-profits rate applies up to £— and the main rate kicks in at £—.
Heads up: Corporation tax is due 9 months and 1 day after your year end — mark the date and set the cash aside.
Want help reducing this number? Book a free chat or call 020 7731 1117.
Three things to plan around.
A little foresight at year-end can knock thousands off the bill.
Time your expenses
Legitimate spending before year-end reduces taxable profit. Kit, training, subscriptions, pension contributions — all count.
Watch the £50k cliff
Just over £50k pushes you into marginal relief. Pension contributions are a common, clean way to get tax relief while bringing profit back under the line.
Associated companies matter
If you run more than one company, the £50k and £250k thresholds split across them. Plan dividend and pension timing together.
Who needs to pay
Who actually has to pay corporation tax?
HMRC expects payment from most UK organisations that turn a profit, though a couple of common business types sit outside it entirely.
In scope
UK resident companies pay corporation tax on their worldwide profits, and the same rules apply to most limited companies, co-operatives, and unincorporated associations such as sports clubs, community groups and societies. An overseas company only pays UK corporation tax on the profit generated by its UK activities, usually through a branch or office, not on income earned elsewhere.
Outside the scope
Sole traders and partnerships don’t pay corporation tax at all. Instead, they pay income tax on their profits through Self Assessment, since the business itself isn’t a separate legal entity from its owner. If you’re a small business owner weighing up which structure suits you, our accountants can talk you through the trade-offs.
Helpful to know
What is an “associated company”?
If you control more than one company, HMRC treats the corporation tax thresholds as shared across them.
In plain English
Two companies are associated when one controls the other, or both are under the control of the same person or group. This includes overseas companies — a Ltd you control in New Zealand or Australia counts just as much as a UK one.
Common examples:
- You run a contracting Ltd and a property Ltd.
- You and your spouse each have your own Ltd company.
- A holding company that owns a subsidiary.
Why it matters
The £50,000 and £250,000 corporation tax thresholds are divided across all associated companies.
For example, with 2 of them, each one gets:
- Small-profits rate (19%) up to £25,000
- Main rate (25%) above £125,000
- Relief tapers the rate in between
Dormant companies usually don’t count, and a few other exemptions apply (passive holding companies, for example). We can check your specific setup.
Deadlines
How and when do you pay?
Registering and filing on time matters as much as getting the figure right.
Registering with HMRC
You must register for corporation tax within three months of starting to trade, even if you don’t expect a profit straightaway. HMRC uses this to set up your accounting period and issue your company’s Unique Taxpayer Reference.
Filing and payment
Your Company Tax Return is due within 12 months of the end of your accounting period, usually the same twelve months as your company’s financial year. Many companies choose 31 December as their year end, though any date works. Payment falls due earlier, nine months and one day after that same date, so budget for the bill before the return itself is required.
Corporation tax FAQs
Corporation tax questions, answered.
The things UK limited company directors ask us most about corporation tax and marginal relief in 2026/27.
How is UK corporation tax calculated for 2026/27?
Taxable profit up to £50,000 is taxed at the small profits rate of 19%. Profit of £250,000 or more is taxed at the main rate of 25%. Profit between the two thresholds is taxed at 25% with marginal relief applied, giving an effective rate that tapers between 19% and 25%. Enter your profit figure in the calculator above for your exact 2026/27 bill.
What is marginal relief and how does it work?
Marginal relief smooths the jump between the 19% small profits rate and the 25% main rate for companies with profit between £50,000 and £250,000. It’s calculated using the standard fraction of 3/200 applied to the difference between the upper limit and your profit, then deducted from tax charged at the main rate.
What are the corporation tax thresholds for 2026/27?
The small profits rate of 19% applies up to £50,000 of taxable profit. The main rate of 25% applies from £250,000 upward. Profit in between qualifies for marginal relief. These thresholds are shared across any associated companies you control.
How do associated companies affect corporation tax thresholds?
If you control more than one company, including overseas companies, HMRC divides the £50,000 and £250,000 thresholds by the number of associated companies. Two of them would each get a £25,000 small profits threshold and a £125,000 main rate threshold, for example.
When is corporation tax due?
Corporation tax is due nine months and one day after your company’s year-end, and the return itself is due 12 months after year-end. Most small and medium-sized companies pay in a single instalment rather than quarterly.
How can I reduce my corporation tax bill?
Legitimate spending before your year-end — equipment, training, subscriptions and pension contributions — reduces taxable profit and can also help bring profit back under the £50,000 small profits threshold. Timing expenses and pension contributions around year-end is one of the simplest levers available.
Do sole traders pay corporation tax?
No. Sole traders and partnerships pay income tax on their profits through Self Assessment, not corporation tax. Only limited companies, most co-operatives and some unincorporated associations pay corporation tax. If you are deciding between staying a sole trader and forming a limited company, it is worth talking to us about which is more tax efficient at your income level.
What counts as taxable profit for corporation tax?
Taxable profit is your trading profit plus any chargeable gains, for example the profit from selling a business asset, minus allowable expenses and capital allowances on qualifying capital expenditure such as equipment and machinery. These gains are taxed through corporation tax rather than personal Capital Gains Tax, which only applies to individuals. Taxable profit is not the same figure as the profit shown in your accounts, since some items are added back or relieved differently for tax purposes.
Is this corporation tax calculator up to date for 2026/27?
Yes — it uses the 2026/27 small profits rate, main rate and marginal relief fraction. The figures are a guide, and your own circumstances (associated companies, capital allowances, R&D relief) can change the result, so talk to us for a tailored calculation.
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Still not sure?
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