Find out how much your small business will be sending to the tax man with our simple corporation tax calculator for UK businesses in 2019 / 2020.
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It’s a tax on company profits and is paid every year, based on your company tax accounting period. It’s also usually your company’s financial year (which can be different to the normal tax year).
In some ways, corporation tax is to businesses what income tax is to individuals. As a small business you pay corporation tax on net profits by generally doing the business, but also investing and selling assets as a company.
The Corporation Tax main rate (excluding ring fence profits) is currently at 19% for 2019/20 and has been for years starting 1 April 2017, 1 April 2018 and 1 April 2019.
If you do business as any of the following, you will have to ensure you pay corporation tax:
For the tax year starting 1 April 2020 (so 2020/21) it will be reduced from 19% to 17%. This was announced by the government in the 2016 budget.
You must file a corporation tax return before 12 months has passed since the end of the accounting period it covers, otherwise you’ll have to pay a penalty. However, you must pay your corporation tax bill (if an amount is payable), usually 9 months and 1 day after the end of the accounting period.
It’s calculated using the percentage for the tax year (shown above) and applied to taxable profits
Yes, personal service companies such as contractor limited companies are required to pay it on their profits.
The HMRC have more information on corporation tax rates, registration and more.