Limited company
Corporation Tax calculator with marginal relief
One rate for small profits, one for large ones, and a sliding scale in the middle that hides a steeper rate than either.
A company with £80,000 of taxable profit in the financial year starting 1 April 2026 pays £17,450 of Corporation Tax: the main rate of 25 % on the whole profit, minus £2,550 of marginal relief, an effective rate of 21.8 %. The rules have not changed since April 2023. Profits up to the lower limit of £50,000 pay the small profits rate of 19 %; profits of £250,000 or more pay 25 %; between the two, marginal relief equals the standard fraction of 3/200 times the gap between the upper limit and the profit. Both limits are divided by one plus the number of associated companies and cut in proportion for an accounting period shorter than twelve months. The relief tapers away as profit rises, so each extra pound inside the band costs 26.5 %, more than the main rate itself.
Corporation Tax from 1 April 2026
Corporation Tax
£17,450
| Rate band | marginal relief |
| Marginal relief | £2,550 |
| Effective rate | 21.8 % |
| Limits used | £50,000 to £250,000 |
Figures checked by Radif Partners · Editorial policy · How we calculate
From £30,000 to £300,000
The table shows the tax for a company with no associated companies and a twelve-month accounting period. The last column is what the next £100 of profit costs, as a percentage: the figure to watch when deciding whether to spend on equipment before the year end or pay a bonus.
| Taxable profit | Regime | Marginal relief | Corporation Tax | Average rate | Rate on the next pound |
|---|---|---|---|---|---|
| £30,000 | small profits rate | £0 | £5,700 | 19 % | 19 % |
| £50,000 | small profits rate | £0 | £9,500 | 19 % | 26.5 % |
| £80,000 | marginal relief | £2,550 | £17,450 | 21.8 % | 26.5 % |
| £120,000 | marginal relief | £1,950 | £28,050 | 23.4 % | 26.5 % |
| £180,000 | marginal relief | £1,050 | £43,950 | 24.4 % | 26.5 % |
| £249,000 | marginal relief | £15 | £62,235 | 25 % | 26.5 % |
| £300,000 | main rate | £0 | £75,000 | 25 % | 25 % |
Working out marginal relief by hand
For £80,000: the main rate gives £20,000. The gap to the upper limit is £170,000, and 3/200 of that is £2,550. Take the relief off: £17,450 to pay. The full formula in section 18B of the Corporation Tax Act 2010 also scales the relief by the ratio of taxable profit to augmented profit; a company receiving distributions from companies that are neither related nor associated has augmented profits above its taxable profit and gets a little less relief than this simple version shows.
Associated companies and short periods
HMRC’s Company Taxation Manual treats two companies as associated when one controls the other or both are controlled by the same person or persons. Each association divides the limits: with two associated companies they fall to a third. A builder who runs a trading company and a separate property company may therefore pay 25 % on profits far below £250,000. A first or final accounting period shorter than a year reduces the limits in proportion too, which the months box in the calculator applies. Marginal relief is not available to close investment holding companies or to companies not resident in the UK.
Where Corporation Tax sits in a director’s pay
The figure in the calculator is charged on profit after the director’s salary and employer National Insurance. On £80,000 of trading profit, a £12,570 salary and its employer National Insurance bring the taxable profit down and the bill to £13,818, before any dividend is paid. Dividends come out of what is left and are taxed again in the shareholder’s hands, which the limited company tax calculator adds up in one place.
Small profits rate 19 %, main rate 25 %, lower limit £50,000, upper limit £250,000, standard fraction 3/200 (HMRC rates and allowances).