Corporation Tax Calculator
Estimate the Corporation Tax your company owes on its taxable profits, including Marginal Relief.
Using 2026/27 UK tax rates
Profit after allowable expenses and capital allowances.
Advanced options
Other companies under common control, not counting this one. This shares the £50,000 and £250,000 limits between them.
Usually 12. A shorter period reduces both thresholds proportionately.
Taxable profits plus exempt distributions, such as dividends from unconnected companies. Only affects which rate band applies.
Corporation Tax due
£17,450.00
- Taxable profits
- £80,000.00
- Basis of charge
- Main rate with Marginal Relief
- Tax at main rate
- £20,000.00
- Less Marginal Relief
- − £2,550.00
- Effective tax rate
- 21.81%
- Profit after Corporation Tax
- £62,550.00
Thresholds used: £50,000.00 lower limit and £250,000.00 upper limit, after adjusting for associated companies and the length of the period.
What this means
On profits of £80,000.00, the Main rate with Marginal Relief applies, giving Corporation Tax of £17,450.00 — an effective rate of 21.81%. That leaves £62,550.00 in the company after tax.
Corporation Tax is payable nine months and one day after the end of your accounting period for most small companies, so the figure above is money that needs to stay available rather than being drawn out.
Quick answers
- What is the Corporation Tax rate for 2026/27?
19% on profits up to £50,000.00, 25% on profits of £250,000.00 or more, and a tapered effective rate in between via Marginal Relief.
- How much Corporation Tax is due on £50,000 profit?
At exactly £50,000.00, profits sit at the small profits limit, so the 19% rate applies: tax of £9,500.
- How much is due on £100,000 profit?
£22,750 after Marginal Relief — an effective rate of 22.75%. See the worked example below for the full calculation.
- How much is due on £250,000 profit?
At the upper limit of £250,000.00, Marginal Relief has tapered to zero, so tax is charged at the full 25% main rate: £62,500.
- Does Corporation Tax apply to turnover or profit?
Profit. Corporation Tax is charged on taxable total profits — income and gains after allowable expenses, capital allowances and reliefs — not on your total sales.
Plan ahead for your Corporation Tax bill
Corporation Tax is normally paid after the accounting period ends, so the bill can arrive some months after the profit was earned.
Many businesses find it easier to set money aside progressively through the year rather than funding the bill from future cash flow. This is general information, not tax planning advice.
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How we calculated it
Profits at or below the lower limit of £50,000.00 are taxed at 19%. Profits at or above the upper limit of £250,000.00 are taxed at 25%. In between, tax is charged at 25% and then reduced by Marginal Relief.
Marginal Relief = 3/200 × (upper limit − augmented profits) × (taxable profits ÷ augmented profits). We use that statutory formula rather than a blended percentage, so the answer matches HMRC's method.
Both limits are divided by the total number of associated companies (including this one) and reduced proportionately for accounting periods shorter than 12 months.
Assumptions
The figure entered is treated as taxable total profits after allowable expenses, capital allowances and reliefs. Ring-fence profits, patent box, R&D claims, losses brought forward and quarterly instalment payments are not modelled.
How this calculator works
Since April 2023 the UK has had two Corporation Tax rates rather than one. Small companies keep the 19% rate, large companies pay 25%, and companies in the middle pay a gradually increasing effective rate through Marginal Relief. The result is a smooth slope between 19% and 25% rather than a cliff edge.
Associated companies matter because the £50,000 and £250,000 limits are shared. Broadly, another company is associated with yours if one controls the other, or both are under the control of the same person or people. If you control two companies, each has limits of £25,000 and £125,000, so the higher rates start much earlier.
Once you know the Corporation Tax due, check what is left for shareholders with the dividend tax calculator or compare how a director draws income with the salary vs dividend calculator.
Worked examples
£40,000 profit
A single company with a full 12-month year makes £40,000 taxable profit. That is below the £50,000.00 lower limit, so the small profits rate of 19% applies throughout: tax = £40,000 × 19% = £7,600, leaving £32,400 after tax. The effective rate is 19%.
£100,000 profit
The same company instead makes £100,000, which sits between the two limits, so tax starts at the 25% main rate: £25,000. Marginal Relief is 3/200 × (£250,000 − £100,000) × (£100,000 ÷ £100,000) = £2,250. Tax due is £25,000 − £2,250 = £22,750, an effective rate of 22.75%, leaving £77,250 in the company.
£300,000 profit
At £300,000, profits are above the £250,000.00 upper limit, so the full 25% main rate applies with no Marginal Relief: tax = £300,000 × 25% = £75,000, leaving £225,000 after tax.
Key terms explained
- Marginal Relief
A statutory reduction that tapers Corporation Tax gradually from 25% down to 19% for profits between the lower and upper limits, so there is no sudden jump in rate as profits cross £50,000.
- Augmented profits
Taxable total profits plus certain exempt distributions received from unconnected companies, most commonly dividends. They decide which rate band applies, while the tax itself is charged on taxable total profits.
- Associated company
Broadly, another company under common control with yours — for example because the same person controls both. Associated companies share the £50,000 and £250,000 limits between them.
Common mistakes
Assuming every company simply pays 19% or 25%
Profits between the lower and upper limits are charged at 25% and then reduced by Marginal Relief, producing an effective rate anywhere between 19% and 25% — not a flat figure.
Forgetting associated companies alter the thresholds
The £50,000 and £250,000 limits are shared between associated companies. Two associated companies each get limits of £25,000 and £125,000, so higher rates and Marginal Relief can start much sooner than expected.
Confusing turnover with taxable profit
Corporation Tax is charged on taxable total profits after allowable expenses and capital allowances, not on total sales revenue.
Common questions
When does the 19% rate apply?
The 19% small profits rate applies when a company's augmented profits are at or below £50,000 (adjusted for associated companies and short accounting periods).
When does the 25% rate apply?
The full 25% main rate applies once augmented profits reach £250,000 or more, with no Marginal Relief available above that point.
What happens between £50,000 and £250,000 profit?
Tax is charged at the 25% main rate and then reduced by Marginal Relief, using the formula 3/200 × (upper limit − augmented profits) × (taxable profits ÷ augmented profits). This produces a smoothly increasing effective rate between 19% and 25%.
What is Corporation Tax Marginal Relief?
A statutory calculation that tapers the tax rate gradually from 25% down to 19% as profits fall from £250,000 to £50,000, avoiding a sudden jump in rate at either threshold.
What is an effective Corporation Tax rate?
The actual percentage of profit paid in tax once Marginal Relief is applied — calculated as tax due divided by taxable profits. It sits between 19% and 25% for companies in the Marginal Relief band.
What counts as an associated company?
Broadly, another company is associated with yours if one has control of the other, or if the same person or group of people controls both. Dormant companies are generally ignored. Each associated company reduces the £50,000 and £250,000 limits proportionately, so two associated companies share £25,000 and £125,000 limits each.
What are augmented profits?
Augmented profits are your taxable total profits plus certain exempt distributions received from companies you are not connected with — most commonly dividends from other companies. They are used to decide which rate band you fall into, while the tax itself is charged on taxable total profits.
What happens if my accounting period is shorter than 12 months?
The £50,000 and £250,000 limits are reduced in proportion to the length of the period. A six-month period has limits of £25,000 and £125,000, so a short period can push a company into Marginal Relief on profits that would otherwise be taxed at 19%.
Sources
Last reviewed: 7 September 2026 · Statutory rates: 2026/27. This calculator is information only and is not tax, accounting or financial advice.