HMRC Corporation Tax: complete guide for limited companies

Tell HMRC within three months of starting to do business. That can include trading, buying and selling with a view to profit, advertising, employing someone or earning interest. You will need the company UTR, registration number, trading date and accounting date.

A company can be active for Corporation Tax while still having little income. If it has not begun business and receives no taxable income, tell HMRC it is dormant rather than filing unnecessary returns.

Corporation Tax applies to trading profit, investment income and chargeable gains. The computation adjusts accounting profit for disallowable costs, capital allowances, losses, reliefs and tax rules that differ from the accounts.

Common errors include deducting dividends, treating depreciation as tax relief, missing private use, recording platform deposits as turnover and ignoring an overdrawn director's loan account.

Most small companies pay Corporation Tax nine months and one day after the accounting period ends and file the CT600 within 12 months. Statutory accounts normally reach Companies House within nine months, creating three linked but separate obligations.

The CT600 is filed online with tagged accounts and a tax computation. HMRC can issue a notice to file even where no tax is due, and that notice must be answered unless HMRC withdraws it.

Keep company and accounting records for at least six years from the end of the accounting period, longer if a return is late or an enquiry remains open. Records should support sales, expenses, assets, liabilities, loans, payroll, VAT and tax adjustments.

A company can normally amend its return within 12 months of the filing deadline. HMRC can open an enquiry and request the evidence behind the accounts and computation.

Reconcile monthly, forecast taxable profit quarterly, review reliefs before year end, close the accounts promptly, calculate the liability, pay using the correct period reference and file the CT600 with matching accounts. This order prevents most late interest and correction work.

Rates and deadlines are reviewed for 2026/27, but HMRC interest rates and individual circumstances can change the result. Check the linked official guidance or ask us before acting.