Corporation tax calculator

How corporation tax is worked out

What are the corporation tax rates for 2026/27?

For the financial year that started on 1 April 2026, a company with profits of £50,000 or less pays the small profits rate of 19%, and a company with profits over £250,000 pays the main rate of 25%. In between, it pays 25% less marginal relief, so its effective rate rises gradually from 19% to 25%. These are the same rates and limits that have applied since 1 April 2023, so an accounting period that runs across 1 April needs no split. Budget 2026, on 28 October 2026, kept the government's commitment to cap the main rate at 25%. Oil and gas companies pay different rates on ring fence profits; this calculator does not cover them.

How is marginal relief worked out?

Marginal relief is taken off the tax at the 25% main rate. HMRC's formula is 3/200 × (upper limit − augmented profits) × (taxable profits ÷ augmented profits). Augmented profits are your taxable profits plus any dividends received from companies outside your group; without such dividends the last part of the formula is 1. A company with £100,000 of profits pays £25,000 at 25%, less 3/200 of £150,000, which is £2,250, so £22,750 in all, an effective rate of 22.75%. HMRC's own example adds £8,000 of dividends to £90,000 of profits: £22,500 less relief of 3/200 × £152,000 × 90/98, about £2,094, which leaves £20,406. Between the limits each extra pound of profit costs 26.5p in tax, and each extra pound of allowable cost saves 26.5p.

What counts as an associated company?

Another company is associated with yours if one controls the other, or both are controlled by the same person or people, wherever it is resident. The £50,000 and £250,000 limits are divided by the number of companies: with three associated companies, each of the four gets a lower limit of £12,500 and an upper limit of £62,500. A company counts even if it was associated for only part of the accounting period. A company that carried on no trade or business during the period is ignored, and so is a passive holding company that only holds shares in its 51% subsidiaries and passes their dividends on. Shares held by your relatives or business partners only count towards control if the two companies are substantially interdependent, through financial, economic or organisational links.

What if my accounting period is shorter than 12 months?

The limits are reduced in proportion. HMRC's example is a company with £55,000 of profits in a 9‑month period: its limits are £37,500 and £187,500, so it pays £13,750 at 25% less marginal relief of 3/200 × £132,500, which is £1,987.50, and that leaves £11,762.50. Strictly the limits are reduced by days rather than months, so the figure for a real period can differ by a few pounds. An accounting period can never be longer than 12 months: if your company's accounts cover 15 months, it files two Company Tax Returns, normally one for the first 12 months and one for the remaining 3.

When do I pay corporation tax?

A company with taxable profits of up to £1.5 million pays its corporation tax 9 months and 1 day after the end of its accounting period, so by 1 January 2028 for a year ending 31 March 2027. The Company Tax Return is due later, 12 months after the end of the period, and a late return brings a penalty even when there is no tax to pay. Companies with taxable profits over £1.5 million pay in instalments. HMRC charges interest on tax paid late and pays interest on tax paid early.

Rates checked 9 November 2026 against GOV.UK "Corporation Tax rates and allowances" and "Marginal Relief for Corporation Tax", HMRC's Company Taxation Manual (CTM03910 to CTM03955) and the Budget 2026 document. GOV.UK says non-UK resident companies and close investment holding companies cannot claim marginal relief; this calculator assumes your company is neither. This is general information, not tax advice. See GOV.UK: Corporation Tax rates and allowances and Marginal Relief for Corporation Tax.