Corporation Tax Rates UK 2026: How Much Does Your Company Pay?

Chandraketu Tripathi

Finance Editor, Kaeltripton

Published 4 Apr 2026

Last reviewed 4 May 2026

✓ Fact-checked

By Chandraketu Tripathi | Updated April 2026

UK corporation tax is charged on the profits of limited companies at rates between 19% and 25%, depending on profit level. The rates have been unchanged since April 2023, when the main rate rose from 19% to 25% and the small profits rate was reintroduced. Understanding exactly how much tax your company will pay — including the marginal relief calculation for profits between £50,000 and £250,000 — is essential for cash flow planning and dividend decisions.

Key Facts

Small profits rate: 19% (profits up to £50,000) | Main rate: 25% (profits above £250,000) | Marginal relief band: £50,001 – £250,000 | Rates frozen: unchanged since April 2023 | Payment deadline: 9 months + 1 day after year-end

UK Corporation Tax Rates 2026 — At a Glance

Profit Level	Rate	Notes
Up to £50,000	19% — Small Profits Rate	Only applies if company has no associated companies
£50,001 – £250,000	Between 19% and 25%	Marginal relief applies — effective rate between 19% and 25%
Above £250,000	25% — Main Rate	Full 25% on all taxable profits
Associated companies	Thresholds divided	2 associated companies: each threshold halved to £25,000/£125,000

Corporation Tax Calculator: How Much Does Your Company Pay?

Source: HMRC. Marginal relief formula: (£250,000 − profits) × 3/200. Excludes R&D credits, capital allowances, and other reliefs.
Annual Profit	Rate Applied	Marginal Relief	Tax Payable	Effective Rate
£20,000	19%	None	£3,800	19.0%
£50,000	19%	None	£9,500	19.0%
£75,000	25% less relief	£2,625	£16,125	21.5%
£100,000	25% less relief	£2,250	£22,750	22.75%
£150,000	25% less relief	£1,500	£36,000	24.0%
£200,000	25% less relief	£750	£49,250	24.6%
£250,000	25%	None	£62,500	25.0%
£500,000	25%	None	£125,000	25.0%
£1,000,000	25%	None	£250,000	25.0%

How to Calculate Marginal Relief — Step by Step

If your company's taxable profits fall between £50,001 and £250,000, you use marginal relief to calculate the actual tax owed. Here's the formula: Marginal Relief = (£250,000 − Taxable Profits) × 3/200. Then: Tax Payable = (Profits × 25%) − Marginal Relief. Example for a company with £120,000 profit: 1) 25% of £120,000 = £30,000. 2) Marginal relief = (£250,000 − £120,000) × 3/200 = £130,000 × 0.015 = £1,950. 3) Tax payable = £30,000 − £1,950 = £28,050. Effective rate = 23.4%.

Associated Companies: How They Affect Your Thresholds

If your company has associated companies — other companies under the same or related ownership — the £50,000 and £250,000 profit thresholds are divided between them. The number of associated companies equals the total number of companies in the group minus one. For example: 1 company alone = thresholds of £50,000 and £250,000. 2 associated companies = thresholds of £25,000 and £125,000 each. 4 associated companies = thresholds of £12,500 and £62,500 each. This can push a small business into the marginal relief band or even the main rate sooner than expected.

When Is Corporation Tax Due?

Company Size	Payment Deadline	Return Deadline
Small (profits under £1.5m)	9 months + 1 day after accounting period end	12 months after accounting period end
Large (profits £1.5m–£20m)	Quarterly instalments in months 7, 10, 13, 16	12 months after accounting period end
Very large (profits over £20m)	Quarterly instalments in months 3, 6, 9, 12	12 months after accounting period end

Reducing Your Corporation Tax Bill Legally

Claim all allowable expenses — salaries, rent, equipment, software, professional fees, travel
Capital allowances — full expensing on qualifying plant and machinery (100% first-year allowance)
R&D tax relief — enhanced deductions or payable credits for qualifying research and development
Pension contributions — employer pension contributions are a deductible business expense
Director salary planning — salary and dividend mix to optimise personal and corporate tax
Loss relief — carry losses forward against future profits or back against prior year profits

Frequently Asked Questions

What is the corporation tax rate in the UK for 2026?

The UK corporation tax rates for 2026 (financial year starting 1 April 2026) are: 19% (small profits rate) for profits up to £50,000, 25% (main rate) for profits above £250,000, and a marginal rate between 19% and 25% for profits between £50,001 and £250,000 — calculated using marginal relief. These rates are unchanged from 2023-24, 2024-25, and 2025-26.

How is corporation tax calculated UK?

Corporation tax is calculated on your company's taxable profits — this is your turnover minus allowable business expenses, capital allowances, and reliefs. If profits are under £50,000: multiply by 19%. If profits are over £250,000: multiply by 25%. If profits are between £50,000 and £250,000: start with 25% then subtract the marginal relief amount = (£250,000 minus your profits) × 3/200.

What is marginal relief for corporation tax UK?

Marginal relief reduces the effective corporation tax rate for companies with profits between £50,001 and £250,000. It is calculated as: (Upper limit £250,000 − your profits) × 3/200. Example: profits of £100,000: tax at 25% = £25,000. Marginal relief = (£250,000 − £100,000) × 3/200 = £2,250. Final tax = £22,750 (effective rate 22.75%).

What is the small profits rate for corporation tax UK 2026?

The small profits rate is 19% and applies to companies with taxable profits of £50,000 or less in a 12-month accounting period. If your company has associated companies (companies under common control), the £50,000 threshold is divided between them — for example, 2 associated companies each get a threshold of £25,000.

When is corporation tax due UK?

For small companies (profits under £1.5 million), corporation tax is due 9 months and 1 day after the end of your accounting period. For example, a company with a 31 March 2026 year-end must pay by 1 January 2027. Large companies (profits over £1.5 million) pay in quarterly instalments. You must also file your CT600 corporation tax return within 12 months of your accounting period end.

Related Articles

Disclaimer: Prices and rules change — always verify with NHSBSA, GOV.UK, HMRC, and Companies House. Sources: nhs.uk, nhsbsa.nhs.uk, gov.uk, cpe.org.uk, Pharmaceutical Journal, Community Pharmacy England, myiva.co, DS Burge. April 2026.