UK Corporation Tax Calculator 2026/27

For the 2026/27 tax year, the UK Corporation Tax rates are:

• Small Company Rate (19%): Profits up to £50,000
• Marginal Relief: Applies between £50,000 and £250,000
• Main Rate (25%): Profits over £250,000

These thresholds are adjusted proportionally for companies with associated companies.

UK Corporation Tax is calculated using this formula:

The resulting taxable profit is then taxed at the appropriate rate based on:

• Your profit level relative to the tax thresholds
• Number of associated companies
• Whether marginal relief applies

Add backs are disallowed expenses — costs in your accounts that HMRC does not allow as tax deductions. Common add backs include:

• Client and staff entertainment (50% disallowance typically applies)
• Depreciation (replaced by capital allowances for tax)
• Disallowed donations (exceeding HMRC limits)
• Penalties and fines
• Owner's personal expenses mixed with business costs

Use our calculator above to add these adjustments to your profit per accounts.

Marginal relief prevents companies from paying disproportionately more tax when their profits exceed the small company threshold. It provides a reduction on the Corporation Tax bill for profits between £50,000 and £250,000.

The relief is calculated using the marginal fraction of 3/200 (1.5%). Without marginal relief, a company with £100,000 profit would pay £25,000 tax (25%). With relief, the tax might be around £19,250 — a significant saving.

The formula accounts for the difference between profits taxed at the main rate vs. the small rate.

Associated companies share the Corporation Tax profit thresholds. A company is associated if it has control over another company, or if the same person(s) control both.

When calculating thresholds:

Example: With 2 associated companies, the limits become £25,000 and £125,000 each instead of £50,000 and £250,000.

This means more companies may fall into the marginal relief band or pay the main 25% rate.

Capital allowances are tax deductions for capital expenditure on business assets. They replace depreciation in tax calculations because depreciation is not allowable for Corporation Tax purposes.

Types of Capital Allowances:

• Annual Investment Allowance (AIA): 100% relief on qualifying expenditure up to £1,000,000
• First Year Allowances (FYA): 100% for energy-efficient or environmentally beneficial equipment
• Writing Down Allowances (WDA): 18% or 6% per year on remaining value
• Structures and Buildings Allowance: 3% per year for commercial buildings

Corporation Tax payment deadline: 9 months and 1 day after your company's accounting period ends.

CT600 return filing deadline: 12 months after your accounting period ends.

Example: For a company with year-end 31 March 2026:

• Tax payment due: 1 January 2027
• CT600 return due: 31 March 2027

All Corporation Tax payments and returns must be filed electronically through HMRC's online services.

Profit per Accounts is the net profit shown in your statutory accounts, prepared under UK GAAP or IFRS. It includes all income and expenses according to accounting rules.

Taxable Profit is the profit calculated for Corporation Tax purposes. It starts with the accounting profit and makes adjustments for:

• Adding back disallowed expenses (add backs)
• Including non-trading income (e.g., bank interest)
• Deducting capital allowances instead of depreciation
• Claiming loss reliefs and deductions

The taxable profit is often different from the accounting profit, which is why a detailed calculation is essential.