Corporation Tax calculator
Work out the corporation tax on your company's profit — the 19% small-profits rate, the 25% main rate, and the marginal relief that bridges them — including how associated companies shrink the thresholds.
Your company
The bill
Your effective rate on the curve
Three rates, and the odd one in the middle
Corporation tax in 2026/27 has a small-profits rate of 19% up to £50,000, a main rate of 25% above £250,000, and between the two a mechanism called marginal relief that produces an effective 26.5% on each pound inside the band. Yes, higher than the main rate: the system claws back the benefit of the 19% start as profit grows. A company making £40,000 pays £7,600, a clean 19%. At £100,000 the bill is £22,750, a 22.8% average but 26.5p on the next pound earned. At £300,000 the full 25% applies to everything: £75,000.
The £50,000 to £250,000 squeeze
That 26.5% marginal zone is where planning actually pays. A £5,000 employer pension contribution made by a company at £100,000 of profit saves £1,325 of corporation tax, where the same contribution at the 19% small-profits rate saves £950. Timing matters too: pulling allowable spending into a year that sits inside the band buys relief at the highest rate the regime offers. Directors drawing income should also know the band exists, because salary is deductible and shifts the company's position within it.
Associated companies shrink the thresholds
The £50,000 and £250,000 limits are shared between associated companies, broadly those under common control. Two associated companies get £25,000 and £125,000 each; five get £10,000 and £50,000. A group of small companies can find every one of them paying marginal-relief rates on modest profits, which is exactly the sort of thing that surfaces at year-end when it's too late to plan for. The calculator handles the division for you. For what the tax means for your own pay, the director's pay planner and the salary vs dividend comparison pick up the story where the company bill ends.
Common questions
What are the corporation tax rates for 2026?
Profits up to £50,000 pay the 19% small-profits rate and profits of £250,000 or more pay the 25% main rate. Between the two, marginal relief tapers the bill — which means each pound in that band is effectively taxed at 26.5% until the average reaches 25%.
What is marginal relief and how is it calculated?
Marginal relief bridges the 19% and 25% rates. The company pays 25% on all profit, minus a relief of 3/200 of the difference between £250,000 and its profit. The effect is an average rate that climbs smoothly from 19% at £50,000 to 25% at £250,000.
How do associated companies change the thresholds?
The £50,000 and £250,000 thresholds are divided by the number of associated companies plus one. Two companies under common control each get thresholds of £25,000 and £125,000 — so profits hit the higher rates much sooner. Dormant companies don’t count.
Is corporation tax the only tax a company pays on profit?
It is the tax on the company’s profit, but taking the money out personally is taxed again — dividend tax, or income tax and NI on salary. Our salary vs dividend and sole trader vs limited company calculators show the combined picture.
These results are estimates for general information only and are not financial advice. Corporation tax depends on your exact accounting period, reliefs and adjustments — confirm the real bill with your accountant. Read the full disclaimer.