Corporation Tax Calculator UK (2026)
Work out the corporation tax a UK limited company owes on its taxable profit, including the 19% small profits rate, the 25% main rate and Marginal Relief. It also shows your payment and filing dates. Rates last checked against GOV.UK on 1 October 2026.
Nothing you enter is stored or sent anywhere. Results are estimates for information only, not tax advice.
Rates, assumptions and limits
Rates used (periods from 1 April 2023, unchanged for 2026): 19% up to £50,000, 25% over £250,000, and 25% less Marginal Relief in between, using the 3/200 fraction. Source: HMRC rates and allowances.
Features: small profits rate, main rate, Marginal Relief, associated companies, short accounting periods, dividends from non-associated companies, close investment-holding companies, payment and filing dates.
Not covered: ring fence profits, non-UK resident companies, loss relief rules, R&D relief, group relief, periods starting before 1 April 2023. Short periods scale the limits by days ÷ 365. Check results with HMRC’s Marginal Relief calculator or an accountant.
Corporation Tax Calculator UK: How to Work Out What Your Company Owes (2026)
A corporation tax calculator turns your company’s taxable profit into the bill HMRC expects, using the 19% small profits rate, the 25% main rate, or a sliding scale in between. This guide is for UK limited company directors, contractors and bookkeepers who want to understand the maths behind the number, not just read it off a screen.
Quick answer: taxable profits of £50,000 or less are taxed at 19%, and profits over £250,000 at 25%. Between those limits the tax is 25% of profit minus Marginal Relief, where Marginal Relief = 3/200 × (£250,000 − profit) for a standalone company with a 12-month period. A company with £100,000 of taxable profit owes £22,750, an effective rate of 22.75%. For a quick figure, use the calculator on this page, then check the assumptions below.
- What corporation tax is and who pays it
- How corporation tax is calculated, step by step
- UK corporation tax rates for 2026
- Marginal Relief explained
- What changes the result
- What counts as taxable profit
- Deadlines: when corporation tax is due
- Corporation tax and director pay
- Common mistakes
- When a calculator is not enough
- FAQ
- Sources
What corporation tax is and who pays it
Corporation tax is the tax a UK limited company pays on its profits. It is not the same as the Income Tax a director pays on salary, and it is not charged on turnover. A company with £500,000 of sales and £460,000 of allowable costs is taxed on the difference, after adjustments.
Sole traders and partnerships do not pay it. They pay Income Tax on business profits through Self Assessment. Some people search for a “corporate tax calculator”, but in the UK the tax is called corporation tax, and the rules below are UK-specific.
How corporation tax is calculated, step by step
If you have wondered how corporation tax is calculated, the process has five steps. The bill is not simply a percentage of the profit in your accounts, because tax rules treat some costs differently from accounting rules.
- Start with accounting profit for the company’s accounting period: income minus business costs. The period is usually your financial year, as explained on GOV.UK’s accounting period page.
- Add back costs the tax rules do not allow, such as depreciation and client entertaining.
- Deduct capital allowances and any reliefs you qualify for. These replace depreciation for tax purposes.
- Apply the right rate to the resulting taxable profit: 19%, 25%, or 25% less Marginal Relief.
- Pay and file on time. Payment is usually due 9 months and 1 day after the period ends, and the return 12 months after.
Worked example: from accounts to tax bill
These figures are invented for illustration. The company is standalone, has a 12-month period and receives no dividends.
| Line | Amount |
|---|---|
| Turnover | £180,000 |
| Staff costs (including director salary) | −£60,000 |
| Rent | −£12,000 |
| Software and subscriptions | −£6,000 |
| Client entertaining | −£3,000 |
| Depreciation | −£4,000 |
| Accounting profit | £95,000 |
| Add back client entertaining | +£3,000 |
| Add back depreciation | +£4,000 |
| Less capital allowances | −£5,000 |
| Taxable profit | £97,000 |
| Tax at 25% | £24,250 |
| Marginal Relief: 3/200 × (£250,000 − £97,000) | −£2,295 |
| Corporation tax due | £21,955 |
That is an effective rate of about 22.63% on taxable profit. Notice that the accounting profit and the taxable profit differ by £2,000, which is why a calculator that only asks for “profit” needs you to enter the adjusted figure.
UK corporation tax rates for 2026
GOV.UK’s rates and allowances page shows that the rates for years starting 1 April 2026 match those for 2023, 2024 and 2025. There is no single rate for all companies any more, because the rate depends on profit.
| Taxable profit | Rate | How it works |
|---|---|---|
| £50,000 or less | 19% | Small profits rate |
| £50,001 to £250,000 | 25% less Marginal Relief | Effective rate rises gradually from 19% to 25% |
| Over £250,000 | 25% | Main rate |
The standard fraction used in the Marginal Relief formula is 3/200. You can confirm all of these figures on HMRC’s Corporation Tax rates and allowances page and the GOV.UK rates guide.
Rates apply by financial year, which runs from 1 April to 31 March. If your accounting period straddles two financial years with different rates, tax is worked out for each part by the number of days. With the rates unchanged since April 2023, this only matters for periods that began before that date.
Marginal Relief explained
Marginal Relief stops the tax bill jumping from 19% to 25% the moment profit passes £50,000. HMRC’s Marginal Relief guidance says it applies to companies with profits between £50,000 and £250,000.
For a company with no dividend income from other companies, taxable profit and augmented profits are the same, so the last part equals 1 and the formula simplifies to 3/200 × (£250,000 − profit). That is the version used in the examples here.
| Taxable profit | Corporation tax | Effective rate |
|---|---|---|
| £30,000 | £5,700 | 19.00% |
| £50,000 | £9,500 | 19.00% |
| £75,000 | £16,125 | 21.50% |
| £100,000 | £22,750 | 22.75% |
| £150,000 | £36,000 | 24.00% |
| £200,000 | £49,250 | 24.63% |
| £250,000 | £62,500 | 25.00% |
| £300,000 | £75,000 | 25.00% |
One practical consequence comes from this formula. Because the relief shrinks as profit grows, each extra £1 of profit between £50,000 and £250,000 costs about 26.5p in corporation tax (25p of tax plus 1.5p of lost relief). That is higher than the headline 25%, and it is worth remembering when you time a large purchase or bonus near the threshold.
To check a result against the official method, HMRC provides a Marginal Relief calculator for profits from 1 April 2023.
What changes the result
The £50,000 and £250,000 limits are not fixed for every company. Several situations change them or remove Marginal Relief altogether.
Associated companies
The limits are divided by the number of associated companies, including yours. HMRC’s example is a company with three other associated companies, where the limits are divided by 4, giving £12,500 and £62,500. You can read more in HMRC’s associated companies manual.
Here is how much this matters. A standalone company with £60,000 of profit pays £12,150 (20.25%). If it has one associated company, the limits halve to £25,000 and £125,000, and the bill becomes £14,025 (23.38%), because 25% × £60,000 = £15,000 less 3/200 × £65,000 = £975.
Short accounting periods
If the period is shorter than 12 months, for example the first period after incorporation, the limits are reduced proportionately. A calculator that assumes a full year will overstate the relief for a short period.
Companies that cannot claim Marginal Relief
According to HMRC, you cannot claim Marginal Relief if you are a non-UK resident company, a close investment holding company, or if your profits, including distributions from unrelated, unassociated companies, go over £250,000.
What counts as taxable profit
The most common reason a DIY calculation is wrong is the profit figure, not the rate. The table shows typical treatment. Conditions apply, so check GOV.UK’s guidance on expenses for your own costs.
| Item | Usual tax treatment |
|---|---|
| Staff wages, rent, software, insurance | Deductible if incurred for the business |
| Client entertaining | Not deductible, so add it back |
| Depreciation in the accounts | Added back, replaced by capital allowances |
| Equipment and machinery | Relief through capital allowances |
| Fines and penalties | Not deductible |
| Dividends paid to shareholders | Not a cost, paid out of profit after tax |
The allowances and reliefs page lists the main reliefs that can reduce a bill further.
Deadlines: when corporation tax is due
This is the surprise for many new directors: the payment deadline falls before the return is due. GOV.UK’s guidance on paying your Corporation Tax bill says most companies must pay 9 months and 1 day after the accounting period ends.
| Task | Deadline | If the period ends 31 March 2026 |
|---|---|---|
| Pay corporation tax | 9 months and 1 day after period end | 1 January 2027 |
| File the Company Tax Return (CT600) | 12 months after period end | 31 March 2027 |
| Taxable profits over £1.5 million | Paid in instalments | See GOV.UK rules |
Diary the payment date yourself, because HMRC charges interest on tax paid late. The filing rules are on GOV.UK’s Company Tax Returns page.
Corporation tax and director pay
Corporation tax is only half the picture for an owner-managed company. Salary is a deductible cost, so it reduces the company’s taxable profit. Dividends are paid from profit after corporation tax, so they do not. Both then create personal tax for the director.
To see the personal side, use our UK income tax calculator and the UK take-home pay calculator. GOV.UK explains tax on dividends for the shareholder. If the company provides a vehicle, the company car tax calculator covers the benefit-in-kind side of that decision.
Looking at the company and personal bills together is the only way to judge how much you keep overall. For more tools, browse our UK financial calculators hub.
Common mistakes when working out corporation tax
- Using turnover instead of profit. Tax is charged on taxable profit, not sales.
- Skipping the add-backs. Accounting profit and taxable profit often differ by depreciation and non-deductible costs.
- Applying a flat 25%. Smaller companies pay 19% or a blended rate, so a flat 25% can overstate the bill by thousands.
- Ignoring associated companies. A second company under common control can halve the limits.
- Forgetting short periods. A first-year period under 12 months reduces both limits.
- Mixing up payment and filing dates. Payment comes first, at 9 months and 1 day.
- Treating dividends as a cost. They do not reduce corporation tax.
When a calculator is not enough
A corporation tax calculator is an estimate built on stated assumptions. Ask an accountant if any of these apply:
- The company made a loss, or carries losses forward from earlier years.
- You claim research and development relief or other specialist reliefs.
- The company is part of a group, or has associated companies you are unsure about.
- The company receives dividends or has overseas income.
- Profits are above £1.5 million, which brings instalment payments.
- The accounting period changed, or straddles different rates.
Frequently asked questions
What is corporation tax?
Corporation tax is the tax a UK limited company pays on its taxable profits. It is separate from the personal tax a director or shareholder pays on their own salary or dividends.
How much is corporation tax in the UK?
The main rate is 25% on profits over £250,000, and the small profits rate is 19% on profits of £50,000 or less. Profits in between are taxed at the main rate reduced by Marginal Relief, so the effective rate sits between 19% and 25%.
How do you calculate corporation tax?
Start with your accounting profit, add back costs that are not allowable, deduct capital allowances and reliefs to reach taxable profit, then apply the rate that fits that profit. For profits between £50,000 and £250,000, subtract Marginal Relief from the tax at 25%.
Is corporation tax charged on turnover or profit?
It is charged on taxable profit, not turnover. Allowable business costs reduce the profit that is taxed, although some costs, such as client entertaining, are not deductible.
When do I pay corporation tax?
Most companies pay 9 months and 1 day after the end of the accounting period. For a period ending 31 March 2026, that is 1 January 2027. Companies with taxable profits above £1.5 million pay in instalments.
Is there an official HMRC corporation tax calculator?
HMRC offers a Marginal Relief calculator for profits from 1 April 2023. It checks the relief for companies with profits between the lower and upper limits, but it does not build your whole tax bill from your accounts.
Do sole traders pay corporation tax?
No. Sole traders pay Income Tax on their business profits through Self Assessment. Corporation tax applies to limited companies.
Bottom line
Work out taxable profit first, then pick the rate: 19% up to £50,000, 25% above £250,000, and a blended rate in between. Check whether associated companies or a short period change your limits, and put the payment date in your diary. Those steps catch the errors that make most quick estimates wrong.