About the UK Corporation Tax Calculator
This UK corporation tax calculator works out the tax a limited company owes on its taxable profits for accounting periods in the financial year starting 1 April 2026, using the rates HMRC confirms for FY2023 onwards: 19% small profits rate up to £50,000, 25% main rate above £250,000 and marginal relief in between. Enter taxable total profits, any exempt distributions received, the number of associated companies and the length of the accounting period.
Between the two limits, marginal relief reduces the 25% charge so tax rises gradually; the effective marginal rate on profits in that band is 26.5%. The limits are divided by the number of associated companies plus one and reduced proportionately for an accounting period shorter than 12 months, which the calculator handles automatically.
It is aimed at company directors, bookkeepers and accountants estimating a CT600 liability or planning dividends and pension contributions. Taxable profit means profit after adding back disallowable costs and deducting capital allowances. Ring-fence (oil and gas) profits, which have their own rates, are not covered, and close investment-holding companies pay the 25% main rate on all profits regardless of size.
With the default inputs, the corporation tax payable is £28,050.00. Change any value above to recalculate instantly.
How to use the uk corporation tax calculator
- 1Enter taxable total profits after adjustments and capital allowances.
- 2Add any dividends received from non-group companies (exempt distributions).
- 3Enter the number of associated companies under common control.
- 4Set the accounting period length if it is shorter than 12 months.
- 5Read the corporation tax due, the marginal relief and your effective rate.
Formula and method
Corporation tax depends on augmented profits (A): taxable total profits (N) plus exempt distributions from non-group companies. If A does not exceed the lower limit (£50,000), all of N is taxed at the 19% small profits rate. If A is at least the upper limit (£250,000), N is taxed at the 25% main rate.
In between, tax is calculated at 25% and then reduced by marginal relief using HMRC’s formula F × (U − A) × N/A, where the standard fraction F is 3/200. Both limits are divided by one plus the number of associated companies and multiplied by the period length ÷ 12 for a short accounting period. HMRC confirms the same rates and limits for financial years 2023, 2024, 2025 and 2026.
- N
- Taxable total profits
- A
- Augmented profits (N + exempt distributions)
- L, U
- Lower (£50,000) and upper (£250,000) limits after adjustment
- F
- Standard marginal relief fraction, 3/200
Worked examples
£120,000 profit, standalone company
Profit is between £50,000 and £250,000, so tax is first worked out at 25% (£30,000). Marginal relief is 3/200 × (£250,000 − £120,000) × £120,000/£120,000 = £1,950, so tax is £28,050 — an effective rate of 23.4%.
£40,000 profit — small profits rate
Profits are under the £50,000 lower limit, so the whole £40,000 is taxed at 19%: £7,600.
£80,000 profit with one associated company
Two companies share the limits, so they fall to £25,000 and £125,000. Tax at 25% is £20,000, less marginal relief of 3/200 × (£125,000 − £80,000) = £675, giving £19,325.
£300,000 profit — main rate
Profits exceed the £250,000 upper limit, so everything is taxed at 25%: £75,000.
Frequently asked questions
What is the corporation tax rate for 2026/27?+
For the financial year starting 1 April 2026 the main rate is 25% for profits over £250,000 and the small profits rate is 19% for profits up to £50,000. Companies in between pay 25% reduced by marginal relief.
How does marginal relief work?+
Marginal relief reduces the 25% charge for profits between £50,000 and £250,000 using the formula 3/200 × (upper limit − augmented profits) × taxable profits ÷ augmented profits. It makes the effective rate rise smoothly from 19% to 25%.
Why is the marginal rate 26.5%?+
Inside the marginal relief band each extra £1 of profit is taxed at 25% and also reduces marginal relief by 1.5p (3/200), so the combined marginal rate is 26.5% until profits reach £250,000.
What counts as an associated company?+
A company is associated with another if one controls the other or both are under the control of the same person or group of persons. Dormant companies and some passive holding companies are ignored. The limits are divided by the number of associated companies plus one.
When is corporation tax due?+
For most companies, corporation tax must be paid 9 months and 1 day after the end of the accounting period, and the CT600 return is due 12 months after the period end. Large companies with profits over £1.5 million pay by quarterly instalments.
Tax results are estimates based on published rules and simplified assumptions. They are not tax advice — check official guidance or a tax professional for your situation.