TL;DR: "Taxes payable" in a UK accounting context normally means the amount of tax that has been incurred for a period but not yet paid to HMRC at the balance sheet date. The figure appears on the balance sheet as a current liability and combines corporation tax payable, PAYE income tax payable, employee and employer National Insurance payable, VAT payable, and any other tax owed. For a UK company, corporation tax for an accounting period is normally payable nine months and one day after the period end (or in instalments for larger companies). PAYE and NIC are typically payable monthly. VAT is normally payable quarterly under Making Tax Digital. The taxes payable figure is reconciled at each period end and is a routine balance sheet line in UK company accounts prepared under FRS 102 or FRS 105.
Last reviewed May 2026
"Taxes payable" is a term used in financial reporting to describe a liability for tax that has been incurred but not yet paid. It appears on a company's balance sheet as a current liability, alongside trade creditors, accrued expenses and other short-term liabilities. The figure is the total of all tax obligations that the entity has incurred but has not yet settled with HMRC (or, for companies trading in more than one country, with overseas tax authorities).
This guide explains what makes up the taxes payable line in UK company accounts in 2026, how each tax is calculated and paid, the relevant accounting framework, and how to reconcile the balance sheet figure against the HMRC position for a company at the year end.
What makes up the taxes payable line
In a UK company balance sheet prepared under FRS 102 (the main UK accounting standard for small and medium-sized entities), FRS 105 (for micro-entities), or full IFRS for listed companies, the taxes payable line typically combines several sub-balances. The largest, for a profitable trading company, is usually corporation tax. PAYE and National Insurance payable from the most recent payroll month is the next significant component. VAT payable on the most recent quarter's return is the third.
The exact composition depends on the company's accounting policies and the level of disclosure. Some accounts disaggregate the line into separate captions (corporation tax payable, PAYE/NIC payable, VAT payable); others combine them under "other taxes and social security" and "corporation tax payable" as two lines. The notes to the accounts may give a further breakdown.
A loss-making company can still have taxes payable at the period end if PAYE, NIC and VAT obligations exceed the corporation tax loss. Equally, a company with a corporation tax loss may have a corporation tax receivable position (if the loss can be carried back to recover tax paid in a prior period under group relief or carry-back rules).
Corporation tax payable
Corporation tax for a UK company is charged on its taxable profits for an accounting period. The taxable profit is the accounting profit adjusted for tax-specific rules: adding back disallowable expenses, deducting allowable expenses, applying capital allowances on capital expenditure rather than accounting depreciation, and applying loss relief and group relief where available.
The corporation tax main rate for 2026-27 is 25 percent for companies with taxable profits over 250,000 pounds. A small profits rate of 19 percent applies to companies with profits up to 50,000 pounds, with marginal relief tapering between the two thresholds. The thresholds are reduced for groups of companies and for associated companies under the related rules.
Standard corporation tax payment is due nine months and one day after the end of the accounting period (so 1 October 2027 for a year ending 31 December 2026). "Large" companies (taxable profits over 1.5 million pounds, adjusted for associated companies) pay in quarterly instalments during and after the accounting period; "very large" companies pay earlier in the period. The instalment regime is set out in the Corporation Tax (Instalment Payments) Regulations 1998.
PAYE and National Insurance payable
PAYE income tax and employee/employer National Insurance contributions deducted from each payroll run are payable to HMRC. The standard deadline is the 22nd of the month following the payroll period (or the 19th by post). For example, PAYE and NIC on April 2026 payroll are due by 22 May 2026.
For small employers (under 1,500 pounds total monthly PAYE/NIC), HMRC allows quarterly payment instead of monthly, with the same 22nd (or 19th by post) deadline at the end of each quarter. Late payment triggers interest under HMRC's repayment supplement and surcharge regime.
The balance sheet figure for PAYE and NIC payable at the period end typically includes one month's payroll deductions plus any earlier amounts not yet paid. The figure is reconciled against the HMRC PAYE account, which shows the running balance owed.
VAT payable
VAT-registered businesses charge VAT on taxable supplies (at the standard rate of 20 percent, the reduced rate of 5 percent on certain supplies, the zero rate on specific categories, or the exempt rate) and reclaim input VAT on business purchases. The net VAT due to HMRC is paid at the end of each quarterly VAT return period under Making Tax Digital.
VAT returns are due one month and seven days after the end of the VAT quarter. For a business on the standard quarterly cycle with a quarter ending 31 March, the VAT return is due by 7 May. The payment is due at the same time. Direct debit users have the payment taken three working days after the due date.
The balance sheet figure for VAT payable at the period end is the net VAT due on the quarter that has ended but not yet been paid, plus any partial quarter accrued to the period end if the VAT quarter does not align with the accounting year end.
Deferred tax
Deferred tax is a separate line from current tax payable and reflects the timing differences between accounting and tax treatment of items. Common timing differences include capital allowances differing from accounting depreciation, provisions accounted for but not yet allowable for tax, and the use of losses against future profits.
Deferred tax can be a liability (where the company has timing differences that will produce extra tax in future periods) or an asset (where the company expects to recover tax in future periods, for example through unused trading losses carried forward). The recognition criteria are set in FRS 102 section 29 (or IAS 12 for full IFRS preparers).
Deferred tax is normally shown separately from current tax payable in the balance sheet, typically under "Provisions for liabilities" rather than under "Creditors". The combined deferred tax and current tax position is sometimes called the company's "total tax position".
Capital Gains and other taxes
UK companies do not pay Capital Gains Tax in the personal sense; gains on the disposal of assets by companies are normally chargeable to corporation tax under the chargeable gains rules in the Taxation of Chargeable Gains Act 1992. The gain is added to the company's taxable profits for the period and is included in the corporation tax payable line.
Stamp duty, Stamp Duty Land Tax and Stamp Duty Reserve Tax on share transfers and property purchases are normally one-off liabilities and are paid at the time of the transaction. They appear in taxes payable only if the transaction has happened before the period end but the payment has not yet been made.
The Apprenticeship Levy (paid by employers with annual paybill above 3 million pounds) and the Plastic Packaging Tax (paid by manufacturers and importers of plastic packaging with less than 30 percent recycled content) are specialist taxes that affect specific industries. Both are normally paid monthly and appear in taxes payable for any accrued but unpaid amount at the period end.
Reconciliation and disclosure
The taxes payable balance sheet figure should reconcile to the HMRC position at the period end. For corporation tax, this means matching against the corporation tax computation for the period and the HMRC account balance. For PAYE and NIC, this means matching against the payroll RTI submissions and the HMRC PAYE account. For VAT, this means matching against the VAT returns submitted.
Discrepancies can arise from timing differences (a return submitted late, a payment in transit, a refund pending), from HMRC errors (which do happen and can take time to correct), or from prior-period adjustments that affect the current balance. Reconciling at each period end avoids surprises and is part of standard year-end accounts work.
The financial statements typically disclose the corporation tax charge for the year (and any prior-period adjustment), the deferred tax movement, and the effective tax rate (corporation tax as a percentage of accounting profit). Larger companies disclose more detail under FRS 102 section 29 or under IAS 12 for IFRS preparers.
How we verified this
This article reflects the Corporation Tax Act 2009 and Corporation Tax Act 2010 for the corporation tax framework, HMRC guidance on PAYE, NIC and VAT payment deadlines, the Corporation Tax (Instalment Payments) Regulations 1998 for the large company instalment regime, FRS 102 section 29 (Income Tax) for the UK accounting treatment of current and deferred tax for small and medium-sized entities, and current GOV.UK and HMRC published rates for corporation tax, PAYE, NIC and VAT. Specific rates and thresholds change at each annual budget and the latest figures should be checked on GOV.UK for the relevant period.
Disclaimer: This article is general information about UK taxes payable in a company accounting context. It is not personal tax, accounting or legal advice. The right treatment in a specific case depends on the company's circumstances and the accounting framework applied. Businesses should take advice from a chartered accountant or chartered tax adviser on the calculation, presentation and payment of taxes.
Frequently asked questions
What does "taxes payable" mean in UK accounting?
Taxes payable is the amount of tax that has been incurred for a period but not yet paid to HMRC at the balance sheet date. It appears as a current liability on the balance sheet and typically combines corporation tax payable, PAYE income tax and National Insurance payable, VAT payable, and any other tax owed at the period end.
How is corporation tax payable calculated?
Corporation tax is charged on the company's taxable profits for the accounting period at the rates in force for the period. The taxable profit is the accounting profit adjusted for tax-specific rules including capital allowances, disallowable expenses, and loss relief. The 2026-27 main rate is 25 percent for profits over 250,000 pounds, with a 19 percent small profits rate for profits up to 50,000 pounds and marginal relief between the thresholds.
When does corporation tax have to be paid?
Standard corporation tax is due nine months and one day after the end of the accounting period. Large companies (taxable profits over 1.5 million pounds, adjusted for associated companies) pay in quarterly instalments under the Corporation Tax (Instalment Payments) Regulations 1998. Very large companies pay earlier within the accounting period.
How often is PAYE paid to HMRC?
Monthly for most employers, with the deadline being the 22nd of the month following the payroll period (or the 19th by post). Small employers with total monthly PAYE and NIC under 1,500 pounds can pay quarterly. Late payment triggers interest and (for repeated late payments) a surcharge under HMRC's late payment regime.
Is deferred tax included in taxes payable?
No. Deferred tax is shown separately from current tax payable, typically under "Provisions for liabilities" in the balance sheet. Deferred tax reflects timing differences between accounting and tax treatment of items, while current tax payable reflects amounts actually owed to HMRC. The financial statements disclose both, with the total tax charge shown in the income statement.
