Corporation Tax Calculator: How Much Will Your Company Pay in 2025/26?
Working out your corporation tax bill isn't as simple as "multiply profit by 25%". Since April 2023, the UK has had two corporation tax rates with a marginal relief band in between.
Use our free corporation tax calculator to get an instant estimate, or read on to understand exactly how the calculation works.
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The Two Corporation Tax Rates
For financial years starting April 2023 onwards:
| Profit Level | Rate | You Pay |
|---|---|---|
| Up to £50,000 | 19% (small profits rate) | £9,500 max |
| £50,001 – £250,000 | 19-25% (marginal relief) | £9,501 – £62,500 |
| Over £250,000 | 25% (main rate) | 25% of profit |
How Marginal Relief Works
The marginal relief formula reduces your tax when profits fall between £50,000 and £250,000:
Corporation tax = Profit × 25%
Minus marginal relief = (Upper limit – Profit) × Profit / Profit × 3/200
In practice, the effective rates look like this:
| Profit | Tax | Effective Rate |
|---|---|---|
| £50,000 | £9,500 | 19.00% |
| £60,000 | £11,750 | 19.58% |
| £75,000 | £15,438 | 20.58% |
| £100,000 | £22,750 | 22.75% |
| £125,000 | £29,688 | 23.75% |
| £150,000 | £36,250 | 24.17% |
| £175,000 | £42,438 | 24.25% |
| £200,000 | £48,750 | 24.38% |
| £250,000 | £62,500 | 25.00% |
Read our full guide to marginal relief →
Worked Examples
Example 1: Freelance Developer (£40,000 profit)
- Profit: £40,000
- Rate: 19% (below small profits threshold)
- Corporation tax: £7,600
- Due date: 9 months and 1 day after period end
Example 2: Small Consultancy (£80,000 profit)
- Profit: £80,000
- Basic tax at 25%: £20,000
- Marginal relief: (£250,000 – £80,000) × £80,000/£80,000 × 3/200 = £2,550
- Corporation tax: £17,450 (effective rate: 21.81%)
Example 3: Growing Agency (£300,000 profit)
- Profit: £300,000
- Rate: 25% (above upper limit)
- Corporation tax: £75,000
Example 4: Property Company (£120,000 rental profit)
- Profit: £120,000
- Basic tax at 25%: £30,000
- Marginal relief: (£250,000 – £120,000) × £120,000/£120,000 × 3/200 = £1,950
- Corporation tax: £28,050 (effective rate: 23.38%)
Factors That Affect Your Calculation
1. Associated Companies
If you control multiple companies, the £50,000 and £250,000 thresholds are divided equally between them.
Two associated companies:
- Small profits threshold: £25,000 each
- Upper limit: £125,000 each
Three associated companies:
- Small profits threshold: £16,667 each
- Upper limit: £83,333 each
This means a company with £30,000 profit could pay 19% if it's the only company, but fall into the marginal relief band if the director has associated companies.
Read our associated companies guide →
2. Accounting Period Spanning 1 April
If your accounting period crosses 1 April, profits are split across two financial years. Each portion is taxed at the rates for that financial year.
Example: Period 1 January 2024 – 31 December 2024
- FY2023 (Jan–Mar): 91/366 days = 24.86% of profit
- FY2024 (Apr–Dec): 275/366 days = 75.14% of profit
- Each portion taxed at the applicable FY rates
Since both FY2023 and FY2024 have the same rates (19%/25%), this split doesn't change the tax amount. But when rates changed between FY2022 (flat 19%) and FY2023 (19%/25%), the split mattered significantly.
3. Allowable Expenses
Your taxable profit is after deducting all allowable business expenses. Common deductions:
- Staff costs and director salary
- Office rent, utilities, insurance
- Professional fees (accountant, solicitor)
- Marketing and advertising
- Travel and subsistence
- Equipment and supplies
Full list of allowable expenses →
4. Capital Allowances
Business assets aren't deducted as expenses — they're deducted through capital allowances:
- Annual Investment Allowance: 100% deduction on first £1M of qualifying expenditure
- Full expensing: 100% deduction on main rate plant and machinery
- Writing down allowance: 18% or 6% per year for remaining assets
5. Losses
Trading losses from this period or previous periods can reduce your taxable profit:
- Current year losses: Offset against other income in the same period
- Carried forward: Use against future trading profits
- Carried back: Offset against the previous 12 months' profits
Guide to corporation tax losses →
When Is Corporation Tax Due?
| Event | Deadline |
|---|---|
| Pay corporation tax | 9 months and 1 day after period end |
| File CT600 return | 12 months after period end |
Example: Accounting period ends 31 March 2025
- Tax payment due: 1 January 2026
- CT600 filing deadline: 31 March 2026
Large companies (profits over £1.5M) pay in quarterly instalments.
Corporation tax payment guide →
Free Calculator + £59 Filing
- Use our free calculator to estimate your corporation tax bill
- File your CT600 with Taxpipe for £59 — we handle the calculations, iXBRL accounts, and HMRC submission
No subscription. No accountant needed. Just straightforward tax filing.
Related Articles
- Corporation Tax Rates 2025/26 and Marginal Relief
- How to Pay Corporation Tax to HMRC
- CT600 Filing Checklist
- How to Reduce Corporation Tax Legally
- Associated Companies and Thresholds
- Small Company Corporation Tax Rates 2025/2026
- UK Corporation Tax Rates: Complete History
- Corporation Tax Marginal Relief Explained