Corporation tax

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Corporation tax

Corporation Tax is charged on the profits of companies and other organisations, including trading profits, investment income, and capital gains.

Companies must pay tax on profits above the relevant thresholds at rates set by the government, with small profits sometimes eligible for reduced rates.

Corporation Tax is reported and paid through the company’s tax return, and various reliefs and allowances may reduce the amount due.

Select Tax Category:

Financial year commencing
	1 April 2020	1 April 2021	1 April 2022	1 April 2023	1 April 2024	1 April 2025	1 April 2026
Main rate	19%	19%	19%	25% (1)	25% (1)	25% (1)	25% (1)
Small profits rate	N/A	N/A	N/A	19% (2)	19% (2)	19% (2)	19% (2)
Lower limit	N/A	N/A	N/A	£50,000 (2, 3)	£50,000 (2, 3)	£50,000 (2, 3)	£50,000 (2, 3)
Upper limit	N/A	N/A	N/A	£250,000 (1, 3)	£250,000 (1, 3)	£250,000 (1, 3)	£250,000 (1, 3)
Marginal relief fraction	N/A	N/A	N/A	3/200 (4)	3/200 (4)	3/200 (4)	3/200 (4)

[1] Annual profits exceeding the upper limit will be charged at the main rate.

[2] The small profits rate applies to companies with annual profits less than or equal to the lower limit. The small profits rate does not apply to close investment holding companies.

[3] The lower and upper limits will be proportionately reduced for short accounting periods and where there are associated companies.

[4] Companies with profits between the lower limit and the upper limit will pay tax at the main rate reduced by marginal relief.