UK Corporation Tax Calculator 2026/27
Calculate UK Corporation Tax due for accounting periods ending in 2026/27 using current HMRC rates. Handles the 19% small profits rate, 25% main rate, marginal relief between £50,000 and £250,000, associated companies, and short accounting periods — all instantly in your browser, no data sent anywhere.
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How UK Corporation Tax Works in 2026/27
UK Corporation Tax applies to the taxable profits of limited companies, clubs, societies and foreign companies with a UK branch. Since 1 April 2023, HMRC has operated a two-rate system with marginal relief, and the rates remain unchanged for the 2026/27 financial year. Which rate applies depends on the size of your taxable profits and whether you have associated companies under common control.
Corporation Tax Rates 2026/27
Small profits rate: 19% on taxable profits up to £50,000
Main rate: 25% on taxable profits of £250,000 or more
Marginal band: 25% less marginal relief between £50,001 and £249,999 (effective ~26.5%)
The marginal band is counter-intuitive: profits sitting between the lower and upper limits are actually taxed at an effective marginal rate of 26.5%, slightly higher than the headline 25%, because marginal relief tapers away as profits approach the upper limit. Last updated: 14 April 2026, based on HMRC rates effective April 2023 onward.
Marginal Relief Formula Explained
Marginal relief smooths the jump between the 19% small profits rate and the 25% main rate. Instead of a sudden cliff-edge at £50,000, relief is calculated using the standard fraction of 3/200 (0.015). The formula is applied after computing tax at the main 25% rate.
Marginal Relief Standard Formula
Step 1: Main tax = Taxable Profits × 25%
Step 2: Marginal Relief = (Upper Limit − Taxable Profits) × (Taxable Profits / Augmented Profits) × 3/200
Step 3: Corporation Tax = Step 1 − Step 2
Example: £120,000 taxable profit, no associates
- Main tax: £120,000 × 25% = £30,000
- Marginal relief: (£250,000 − £120,000) × 1 × 3/200 = £1,950
- Corporation tax due = £28,050 (effective rate 23.38%)
For companies with no franked investment income (dividends received from other UK companies), augmented profits equal taxable profits, so the ratio in step 2 is 1. The tool assumes this most-common scenario. If your company receives franked investment income, the marginal relief will be slightly lower and you should consult your accountant.
Associated Companies and Short Accounting Periods
If a company has associated companies — another company under common control of the same person or group — the £50,000 and £250,000 thresholds are divided equally between them. This stops groups from fragmenting profits across many small companies to stay under the small profits rate ceiling. A company with two associates shares the thresholds three ways: the lower limit becomes £16,667 and the upper limit £83,333.
Threshold Adjustments
Associated companies: Divide limits by (associates + 1)
Short period: Multiply limits by (months / 12)
Both apply together: Calculator handles this automatically
Accounting periods shorter than 12 months (common in a company's first year or after a year-end change) pro-rate the limits on a daily basis — the calculator uses months as a close approximation. For a 6-month period with no associates, the lower limit is £25,000 and the upper limit £125,000.
When Corporation Tax Must Be Paid
Small and medium companies must pay corporation tax 9 months and 1 day after the end of their accounting period. For a year ending 31 March 2027, the payment is due 1 January 2028. Large companies — those with augmented profits above £1.5 million (divided by associates) — must pay in quarterly instalments, with the first due 6 months and 13 days into the accounting period. Very large companies (profits above £20 million) pay even earlier instalments, often starting during the accounting period itself.
The company tax return (CT600) must be filed within 12 months of the period end, but payment is due earlier than filing, which catches many directors out. Always file on time: HMRC charges a £100 late-filing penalty even if no tax is due.
Frequently Asked Questions
What are the UK corporation tax rates for 2026/27?
From April 2023 onwards (unchanged for 2026/27), the small profits rate is 19% for taxable profits up to \u00a350,000, and the main rate is 25% for profits of \u00a3250,000 or more. Between \u00a350,001 and \u00a3249,999 the main rate of 25% applies but is reduced by marginal relief, producing an effective rate of approximately 26.5% on the slice of profits within the marginal band.
How is marginal relief for corporation tax calculated?
Marginal relief uses the standard fraction of 3/200. The formula is: Marginal Relief = (Upper Limit \u2212 Taxable Profits) \u00d7 (Taxable Profits \u00f7 Augmented Profits) \u00d7 3/200. Corporation tax is then 25% of profits minus that relief. For a company with no franked investment income, augmented profits equal taxable profits, so the company-in-company fraction is 1.
How do associated companies affect corporation tax thresholds?
If a company has associated companies (under common control), the \u00a350,000 lower limit and \u00a3250,000 upper limit are divided by the total number of associates plus one. For example, a company with two associates shares the thresholds three ways \u2014 the lower limit becomes \u00a316,667 and the upper limit \u00a383,333 \u2014 so more profits are taxed at the main 25% rate.
When do I have to pay UK corporation tax?
For most small and medium companies, corporation tax is due 9 months and 1 day after the end of the accounting period. Large companies with profits above \u00a31.5 million (divided by associated companies) must pay in quarterly instalments, and very large companies with profits above \u00a320 million pay earlier instalments starting in the accounting period itself.
Does the calculator support short accounting periods?
Yes. If you enter an accounting period shorter than 12 months, the \u00a350,000 and \u00a3250,000 thresholds are pro-rated proportionally. For example, a 6-month period uses a \u00a325,000 lower limit and \u00a3125,000 upper limit. This matches HMRC\u2019s approach for new companies or accounting period changes.