Corporation Tax Rates
The Corporation Tax rates UK companies pay on profits, where marginal relief applies between the small profits rate and the main rate, and how ring fence companies differ.
Small profits rate
19%
Paid by companies with profits of £50,000 or less, for the financial year starting 1 April 2026.
GOV.UK — HMRC · checked 9 Nov 2026
Main rate
25%
Paid by companies with profits over £250,000, for the financial year starting 1 April 2026.
GOV.UK — HMRC · checked 9 Nov 2026
Marginal relief lower limit
£50,000
Profits between this and the upper limit are taxed at the main rate, reduced by marginal relief.
GOV.UK — HMRC · checked 9 Nov 2026
Marginal relief upper limit
£250,000
Above this, profits are taxed at the full main rate.
GOV.UK — HMRC · checked 9 Nov 2026
Profits between the two limits get marginal relief
The Corporation Tax rate a company pays depends on its level of profit. Companies with profits at or below £50,000 pay the small profits rate. Companies with profits above £250,000 pay the main rate.
A company with profits between those two limits pays the main rate, reduced by marginal relief. This is a reduction in the tax bill that makes the effective rate rise gradually instead of jumping from one rate to the other.
Both profit limits are lower for a company that has associated companies or an accounting period shorter than twelve months: they are reduced in proportion.
HM Revenue and Customs (HMRC) offers a Marginal Relief calculator that shows how much relief is available on profits from 1 April 2023.
Some companies have their own rates
Unit trusts and open-ended investment companies are different: a separate special rate applies to them, rather than the small profits or main rate.
A company whose profits come from oil extraction or oil rights in the UK or the UK continental shelf is a "ring fence" company. Its Corporation Tax rates differ from those of other companies, so the small profits and main rates above do not describe it.
The profit limits for ring fence marginal relief are the same as for other companies from 1 April 2023, and were different for periods before that.
Selling a business asset can create a chargeable gain
Profits from selling or disposing of a business asset are taxed with Corporation Tax. These profits are called chargeable gains.
Indexation Allowance can be used when the gain is worked out, to allow for inflation (as measured by the Retail Prices Index) from the time the asset was acquired until 31 December 2017. It has been frozen since 1 January 2018: where you bought an asset before 2018 and sell it later, the December 2017 factor is used in the calculation, whatever the sale date.