Corporation Tax Calculator United Kingdom

Every UK limited company pays Corporation Tax on its taxable profit, and since April 2023 the rate depends on how much profit it makes. This calculator applies the 2026/27 rules, a 19% small profits rate, a 25% main rate and marginal relief in the band between, so you can estimate your bill, see your effective rate and see how associated companies change the result.

The two rates and the band between

The small profits rate of 19% applies when taxable profit is £50,000 or less. The main rate of 25% applies once profit reaches £250,000. In between, you pay the main rate and subtract marginal relief, so a company just over £50,000 is not suddenly worse off than one just under it. The effective rate climbs gradually from 19% at the bottom of the band to 25% at the top.

How marginal relief is calculated

Multiply your profit by the 25% main rate, then subtract the marginal relief fraction (3/200, or 0.015) times the gap between your profit and the £250,000 upper limit. As a formula: tax = profit × 25% − (£250,000 − profit) × 0.015. Because the relief shrinks as profit approaches £250,000, each extra pound of profit inside the band is taxed at 26.5%, which matters when deciding whether to bring income forward or defer it.

A worked example

A company has £100,000 of taxable profit and no associated companies. The profit is inside the band, so the starting figure is £100,000 × 25% = £25,000, less (£250,000 − £100,000) × 0.015 = £2,250. The Corporation Tax due is £22,750, an effective rate of 22.75%, leaving £77,250 after tax. A company with £40,000 of profit is below the lower limit and pays 19%, or £7,600. A company with £300,000 is above the upper limit and pays the full 25%, or £75,000.

Associated companies

The profit limits are shared between associated companies, typically companies under common control. Both limits are divided by the number of associated companies plus one, so with two associates each company has a lower limit of about £16,667 and an upper limit of about £83,333. The rule, which replaced the 51% group companies test from April 2023, stops a business splitting into several small companies to keep every part in the 19% band. Enter the number of associated companies in the advanced options to see the effect.

How to use the calculator

Enter your company’s taxable profit, meaning profit after allowable expenses and capital allowances, not turnover. The calculator returns the Corporation Tax due, your effective rate, the profit left after tax and the marginal relief applied. If you have associated companies, enter how many in the advanced options; the limits adjust automatically.

Managing profit around the marginal band

Because each extra pound of profit between £50,000 and £250,000 is taxed at 26.5%, planning has the most effect in the band. Legitimate ways to reduce taxable profit include an employer pension contribution for a director, capital allowances such as the Annual Investment Allowance or full expensing on qualifying plant and machinery, and timing discretionary costs so they fall in the right accounting period. A director’s salary is a deductible expense that lowers company profit, while dividends come out of post-tax profit and are taxed on the individual. None of this changes the rates the calculator applies, but it explains why two companies with the same turnover can pay very different Corporation Tax. Weigh any decision to bring income forward or defer it against the 26.5% marginal rate rather than the 25% headline.

Common mistakes

The most frequent is entering turnover instead of taxable profit. Another is overlooking associated companies, which share the £50,000 and £250,000 limits and can push more profit into the main rate than you expect. Short accounting periods catch people out too: the limits are reduced in proportion for a period of less than twelve months, which this tool does not model. Some owners assume that once profit passes £50,000 the whole amount is taxed at 25%, forgetting that marginal relief raises the effective rate gradually. Large companies should also remember the £1.5 million instalment threshold, itself divided by the number of associates, which changes when the tax is paid rather than how much.

Assumptions and limitations

This is a planning estimate, not a substitute for your CT600 return. It uses the 2026/27 rates and profit limits, stored as parameters sourced from HMRC and reviewed each year. It assumes a twelve-month accounting period. It does not cover ring-fence profits from oil and gas, close investment-holding companies (which pay the main rate whatever their profit), exempt distributions that increase augmented profits, or reliefs such as R&D credits and loss carry-backs. For anything beyond a quick estimate, check the current HMRC guidance or speak to an accountant.

About This Corporation Tax Calculator

Use this Corporation tax calculator to get an instant, accurate estimate. The figures follow official GOV.UK guidance and every rate and threshold is kept up to date for 2026. Adjust the inputs above to match your situation, or browse all our calculators to plan your next step.