Corporation tax calculator
UK corporation tax has two rates and a band between them. Profits up to £50,000 pay the small profits rate of 19%; profits of £250,000 or more pay the main rate of 25% on the whole amount. In between, the company pays the main rate less marginal relief, which tapers away as profit rises, so each extra pound in that band is taxed at 26.5%, higher than either headline rate. That is the figure a director deciding whether to take profit this year or next needs. Rates checked 2026-08-28 against gov.uk; unchanged since April 2023.
Calculator
Corporation tax calculator
Profit after allowable expenses and salaries, before dividends.
Corporation tax on £80,000 of profit
£17,450.00
An effective rate of 21.8%, leaving £62,550.00 in the company. Marginal relief takes £2,550.00 off the main-rate figure.
Inside the marginal relief band: 26.5% on the next pound
Between £50,000 and £250,000 the company pays the main rate less marginal relief of 3/200 of the distance to £250,000. The relief shrinks as profit rises, which is why the rate on each extra pound in this band is 26.5%, higher than the 25% main rate itself. On £80,000, the next £1,000 of profit costs £265.00 in tax.
The limits assume one company and a twelve-month accounting period. Each associated company divides both limits, so two companies share £25,000 and £125,000 each, and a short period scales them down in proportion. What the company pays its director in salary and dividends is the next question: the dividend tax calculator and the outside IR35 calculator take this figure on to take-home pay.
How marginal relief works
The relief is 3/200 of the gap between the profit and £250,000. At exactly £50,000 it is worth the full difference between the two rates, so the company pays 19%; at £250,000 the gap is zero and the relief with it. The slope is what catches people out: the tax bill rises from £9,500 to £62,500 across a band of £200,000, which is 26.5% of every pound in it. A company on £100,000 of profit paying £22,750 is therefore charged more on its next pound than a company on £300,000.
What the limits assume
- One company. The £50,000 and £250,000 limits are divided by the number of associated companies plus one. A director with two companies has limits of £25,000 and £125,000 for each, which pushes both into the marginal band far sooner.
- A twelve-month accounting period. A shorter first or last period scales the limits down in proportion to its length.
- Taxable profit, not turnover. Salaries paid to the director and staff, employer National Insurance, pension contributions and allowable expenses all come off first. Dividends do not: they are paid from profit after this tax.
How to use the corporation tax calculator
- 1
Enter the company's taxable profit for a twelve-month period: income less allowable expenses, salaries and employer contributions.
- 2
Read the tax due and the effective rate on the whole profit.
- 3
Check which band the profit sits in, and the rate on the next pound, which is what matters for timing a decision.
- 4
If there are associated companies or a short accounting period, halve or prorate the limits before reading the band.
When should you use the corporation tax calculator?
Use it when you know the company's profit for the year and need the tax on it, particularly if the profit sits between £50,000 and £250,000, where the rate on each extra pound is not either headline rate.
Deciding whether to take profit this year or next
In the marginal band each extra pound is taxed at 26.5%, so deferring profit that would land there can be worth more than it looks.
Comparing a bonus with a dividend
Salary is deducted before this tax; a dividend is paid after it. The comparison needs both this figure and the dividend calculator.
You run more than one company
Associated companies divide both limits between them, so a company well under £50,000 on its own can still be in the marginal band.
A first or final year shorter than twelve months
The limits scale to the period length; a six-month period has limits of £25,000 and £125,000.
Where to go next
- Dividend tax calculatorTo take the after-tax profit through to the director.Open
- Outside IR35 calculatorTo the contractor arrangement with this tax inside it.Open
- Employers NI calculatorTo what a salary costs the company before this tax.Open
All 51 calculators share one tested engine, so a figure from the corporation tax calculator agrees with every other page here. See the full calculator index or the pay and tax guides.
From company profit to your own pocket
This page stops at the company. What is left after corporation tax can be retained, paid as salary, or paid as dividends, and each route is taxed again in the director's hands. The dividend tax calculator takes the after-tax profit through the dividend allowance and rates; the outside IR35 calculator models the usual contractor arrangement of a small salary plus dividends from a day rate, with this tax already inside it. If the work is inside IR35, the umbrella calculator is the right one instead, because there is no company profit to tax.
Rates from gov.uk corporation tax rates, checked 2026-08-28 by Hadi. Single company, twelve-month period, no associated companies.