Limited company guide
How corporation tax is calculated for a small UK company, from accounting profit to tax due.
Written and reviewed by Waqas Sagar Member of ICAEW, Fellow of ACCA, Fellow of AAT, a double graduate and entrepreneur at heart, helping startups grow and serving thousands of businesses nationwide with an excellent team. Published by LimitedCompany.Accountants, 12 London Road, Morden, London SM4 5BQ. Reviewed 12 September 2026 against 2026/27 UK rates and current Companies House and HMRC guidance.
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Xero Gold PartnerCertified advisor
QuickBooks PartnerCertified ProAdvisor100+ yearsCombined team experienceFully insuredUp to £2m indemnityCorporation tax starts with accounting profit, then adjusts: add back items that are not deductible such as depreciation, client entertaining and most fines, and deduct capital allowances on qualifying equipment.
From profit to taxable profit
The rates
Losses
Corporation tax starts with accounting profit, then adjusts: add back items that are not deductible such as depreciation, client entertaining and most fines, and deduct capital allowances on qualifying equipment.
The result is taxable total profit, to which the rates apply.
19% on profits up to £50,000, 25% on profits above £250,000, with marginal relief tapering the effective rate between those points. Those limits are divided by the number of associated companies, which matters if a director controls more than one company.
The annual investment allowance gives 100% relief on up to £1m of qualifying plant and machinery, and full expensing gives 100% first-year relief on qualifying new plant and machinery for companies.
Trading losses can generally be set against other profits of the same period, carried back twelve months, or carried forward against future profits.
Thresholds, rates and deadlines quoted here reflect the 2026/27 UK position. Check current GOV.UK guidance, or ask us, before you rely on them for your own company.
Local help
We work with company directors across London and Surrey from our office at 12 London Road, Morden, London SM4 5BQ. Pick your area, or send the form below and we will call you back.
Frequently asked
No, on taxable profit after allowable costs and capital allowances.
No. Dividends are paid out of post-tax profit. Salary and employer pension contributions are deductible; dividends are not.
Keep bank statements, sales and platform reports, purchase invoices, payroll records, VAT workings, finance agreements and Companies House correspondence. We confirm the exact list at onboarding and identify gaps before a filing deadline becomes urgent.
The fee depends on transaction volume, record quality, VAT and payroll requirements, historic catch-up and the level of reporting needed. We agree a fixed scope and price before technical work starts, with published packages available on our fees page.
Yes. We request professional clearance, collect the prior records and authorities, check the next Companies House and HMRC deadlines, and give you one clear handover list. The process is normally completed remotely.
Yes. We work through secure cloud records, scheduled reviews and digital approvals, while keeping a named team available by phone, video call and email. Clients can also visit our Morden office by appointment.
We regularly work with Xero, QuickBooks, FreeAgent, Sage and connected sales or expense apps. The right setup depends on transaction volume, integrations and the reports you need, not simply the software brand.
The relevant calendar may include annual accounts, Corporation Tax payment and return dates, confirmation statements, VAT returns, payroll submissions and Self Assessment. We map the dates from your company year end and registrations.
No. This page explains general UK rules and common accounting treatment. Your facts, contracts and wider tax position must be reviewed before you rely on a conclusion.
Included approach
Check the current rules
Deadlines, thresholds and filing rules change. GOV.UK and Companies House publish the current statutory position; advice should then be applied to your company’s circumstances.
Talk to an accountant
Share your next deadline, accounting problem or growth question. We will reply with a clear next step and quote any technical work before it begins.
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Appointments run Monday to Friday, 9:00am to 5:30pm. Your confirmation is emailed straight away.
Four London offices
Work with us entirely online, or sit down with your accountant at whichever office suits you. Open Monday to Friday, 9:00am to 5:30pm. Office visits are by appointment only, so please book before coming in.
Free, no obligation
Pick a time that suits you and a qualified accountant will call you about your company, deadlines and fees.
Appointments run monday to friday, 9:00am to 5:30pm. Your confirmation is emailed straight away.
