Corporation Tax:
the complete guide
UK Corporation Tax is charged on a limited company's taxable profit at either the small profits rate (19%, profits up to £50,000) or the main rate (25%, profits over £250,000), with marginal relief tapering the rate in between. It's due 9 months and 1 day after your accounting period ends, before your accounts are even filed with Companies House.
Every UK limited company pays Corporation Tax on its taxable profits, and getting the rate, the deadline and the relief entitlements right matters for cash flow planning as much as compliance. This guide covers the three things directors ask about most: what rate applies to your profit level, when the tax is actually due, and how marginal relief works if you sit between the two headline rates.
The two headline rates, and the band in between
Companies with profits up to £50,000 pay the small profits rate. Companies with profits over £250,000 pay the main rate. Profit in between doesn't jump straight from one to the other, it's tapered by marginal relief, which smooths the transition so a company just over £50,000 doesn't suddenly face the full main rate on its entire profit. See our full breakdown of 2026/27 rates for the exact figures and how associated companies share the thresholds.
When the tax is actually due
Corporation Tax is due 9 months and 1 day after your accounting period ends, which is earlier than most new directors expect, since it's due before your accounts even need to be filed with Companies House. Missing this deadline triggers HMRC interest from the due date, regardless of when you eventually file. Our deadline guide covers exactly how to calculate your specific due date and what happens if you're going to miss it.
Marginal relief, in plain terms
If your profit sits between £50,000 and £250,000, marginal relief reduces your Corporation Tax below what the main rate would otherwise produce, tapering the effective rate upward as profit rises through the band. It's calculated automatically by HMRC's formula, no separate claim needed, but the maths is worth understanding so you're not surprised by the figure. Our marginal relief guide walks through a full worked example.
Associated companies change the maths
If you control more than one company, the £50,000 and £250,000 thresholds are shared between them, not given to each company in full. Two associated companies effectively split the bands in half each, which catches out group structures that weren't planned with this in mind.
In this guide
UK corporation tax rates 2026/27
Small profits rate, main rate and marginal relief in between, explained in full.
When do I need to pay corporation tax?
The exact deadline, and why it catches new companies out.
Corporation tax marginal relief, with examples
A full worked example of how the taper actually works.
Frequently asked questions
What is the current UK Corporation Tax rate?
The small profits rate is 19% for profits up to £50,000, and the main rate is 25% for profits over £250,000, with marginal relief tapering the rate for profits in between.
When is Corporation Tax due?
Corporation Tax is due 9 months and 1 day after the end of your accounting period, which is earlier than the Companies House filing deadline for your accounts.
Do I need to claim marginal relief separately?
No, HMRC's Corporation Tax calculation applies marginal relief automatically based on your declared profit, no separate claim is needed.
Does having more than one company change my Corporation Tax rate?
Yes, if you have associated companies under common control, the £50,000 and £250,000 thresholds are divided between them, reducing the lower-rate band available to each company.
Get your Corporation Tax handled properly
Book a free consultation and we'll make sure your rate, deadline and any relief are all correct.