Starting a new business? Get 40% off our accountancy services for 3 months! 😎


If you run a business in the UK then you might need to submit a Company Tax Return and pay Corporation Tax on the profits that you make. Tax can be a tricky subject, so our article goes into more detail, and covers:

What is Corporation Tax?

Who needs to pay it?

What type of tax return do I need for Corporation Tax?

Company Tax Return FAQs

How much is the Corporation Tax rate in 2023/24?

Marginal Relief for Corporation Tax

How can I reduce my Corporation Tax bill?

Corporation Tax is paid by some UK businesses and organisations on the profits that they make. Profit is the amount of income left over once the business has paid all of its expenses.

Corporation Tax is normally payable by all limited companies incorporated in the UK. There are other organisations which might also need to pay it, even though they’re not incorporated (set up as a limited company):

Other types of businesses, such as sole traders and partnerships, won’t pay Corporation Tax. Instead, you’ll need to submit a Self Assessment tax return, and pay Income Tax on the profits that you make.

Limited company accountancy services

From only £54.50 per month

Learn more

You’ll need to submit a Company Tax Return in order to pay Corporation Tax if you operate a limited company. HMRC will use the information that you submit to work out how much Corporation Tax you owe.

Yes, you should still submit your Company Tax Return, even if you don’t have any tax to pay this year. This is because HMRC won’t know what you owe until they receive your tax return, so you might simply get a fine if you don’t tell them!

Will I need to send a Company Tax Return for a dormant company?

You don’t need to submit a Company Tax Return for a dormant company.

The definition of a dormant company for Corporation Tax purposes is a bit different to the one used by Companies House. As long as your company isn’t actively trading or liable for Corporation Tax, then it’s dormant.

You must tell HMRC that your company is dormant!

Otherwise, they’ll expect to receive a Company Tax Return from you, and you might receive a penalty for not submitting one.

How do I register for Corporation Tax?

Most companies register for Corporation Tax when they register the business at Companies House (known as incorporation), but you can do it at a later date as long as you register within 3 months of starting to trade.

Trading doesn’t just mean making sales, and can actually refer to any sort of business activity – even placing an advert!

You’ll need to sign into your business tax account to register for Corporation Tax, using your Government Gateway ID to sign in. You’ll also need your company’s Unique Taxpayer Reference (UTR).

What should I include in my Company Tax Return?

A complete Company Tax Return consists of several key pieces of information, including:

Should I include my overseas profits on my CT600 tax return form?

If the company is based in the UK, it will be liable for Corporation Tax on all of the profits that it makes, wherever they originate. If the company is based overseas but trades through a branch or office in the UK, only the taxable profits in the UK will be liable for UK tax.

If your UK-based company has to pay tax elsewhere, there may be a double-taxation agreement in place which means the tax you pay overseas can be deducted from your UK Corporation Tax liability.

How do I submit my CT600 and Company Tax Return?

You can complete a CT600 form online, and submit it along with your accounts and other details as part of your Company Tax Return.

You don’t have to do it yourself, and can ask an accountant to do it for you instead, but it’s still your responsibility to make sure it’s submitted on time, and that the bill is paid!

When do I need to submit my Company Tax Return?

The deadline for submitting your Company Tax Return is 12 months following the end of the financial accounting period that it relates to. You might sometimes hear this referred to as the statutory filing date.

What’s the deadline for paying Corporation Tax?

The deadline for paying your Corporation Tax is nine months and a day following the end of the accounting period that it relates to. Not a typo – the deadline for paying the bill really is earlier than the deadline for submitting the tax return!

How do I pay my company’s Corporation Tax bill?

You can pay your tax bill online, through online banking, or over the phone. You can normally only pay through a branch of your bank if you have a paying-in slip from HMRC.

Don’t forget to quote the Corporation Tax payment reference which relates to the accounting period you’re paying for.

You can find this on the ‘notice to deliver your tax return’, any reminders from HMRC, or by signing into your company’s HMRC online account. Choose ‘view Corporation Tax statement’, ‘accounting periods’, then select the correct period. The reference number you need is 17 characters long, for example 1234567890A01234B. It is not the same as your company registration number!

Is a Company Tax Return the same as submitting accounts?

No, the company tax return and the company accounts are two separate things. The company tax return goes to HMRC, who will then calculate and collect the Corporation Tax the company owes.

Your company accounts go to Companies House, who file them with your record for public viewing.

The way that businesses pay Corporation Tax is changing, and from 1st April 2023 limited companies will pay tax depending on which rate they’re eligible for:

Companies reporting profits of… Pay Corporation Tax at a rate of…
Small profit rate Less than £50,000 19%
Main profit rate More than £250,000 25%

HMRC say that the thresholds are proportional to the number of associated companies that your company has. So, if your company has a further 3 other associated companies, that makes a total of 4.

That means that the limits are divided by 4, so the threshold for the small profit rate becomes £12,500 and the limit for the main profit rate becomes £62,500.

Marginal Relief will adjust the rate of Corporation Tax for companies who report profits between these thresholds.

You might be able to claim Marginal Relief if your company’s annual taxable profits from 1st April 2023 are between £50,000 and £250,000. You won’t be able to claim Marginal Relief for:

How do I work out Marginal Relief for Corporation Tax?

The easiest way to work out how much Marginal Relief is available to you is probably with HMRC’s online calculator, but our table below shows how the calculation works on a basic level. In our example the limited company:


Calculation Result
Upper limit
The point at which companies start paying the main profit rate
Taxable profit
The company’s total taxable profit for the financial year
Upper limit minus taxable profit £250,000 – £70,000 £180,000
Marginal Relief fraction
This is the difference between the main profit rate (25%) and the small profit rate (19%), expressed as a fraction.

It’s used to provide a gradual increase in the rate of Corporation Tax between the two.

Normally shown as a fraction (3/200), we’ll show the decimal equivalent to make the calculation easier to understand. 0.015
Marginal Relief available £180,000 x 0.015 £2,700
Corporation Tax before Marginal Relief £70,000 x 25% Main Profit Rate £17,500
Corporation Tax after Marginal Relief £17,500 – £2,700 £14,800

In this case, the effective rate of Corporation Tax is 21.14%, illustrating how there’s a gradual increase in the rate between 19% and 25%.

The good news is that there are several ways you can reduce your Corporation Tax bill, and they’re absolutely allowed!

Pay yourself a salary

Salaries are an allowable expense, which means you can offset them against your profits in order to reduce your Corporation Tax bill. It’s why paying yourself a small salary can be a tax efficient way to take money out of the business.

Pension payments that your company makes on behalf of directors are also deductible, whilst helping you save for the future.

Claim all of your allowable expenses

Keeping excellent financial records helps business owners stay on top of what’s happening in their business, and use this information to make more effective decisions, but it’s also useful for making sure that you record every business expense, ready to claim tax relief.

Claim Capital Allowances

If you buy assets for your business, such as machinery or other types of long-term assets, you might be able to reduce your tax bill by claiming Capital Allowances.

R&D tax relief

Limited companies can sometimes claim tax relief against the cost of research and development work, as long as it meets the strict R&D tax relief criteria.

Tax can be a complicated subject! Learn more about our online accounting services for limited companies. Call the team on 020 3355 4047, and get an instant online quote.

About The Author

Elizabeth Hughes

A content writer specialising in business, finance, software, and beyond. I'm a wordsmith with a penchant for puns and making complex subjects accessible. Learn more about Elizabeth.

More posts by this author
Notify of
Inline Feedbacks
View all comments

Read more posts...

Do I Need to Pay Tax if I Drive for Uber?

Uber is a platform that connects its users to drivers who can either provide them with a lift or drop food off…

Read More

Mental Health for the Self-Employed at Christmas Report

Self-employment can often be an attractive prospect, with more opportunities for flexible working and creative freedom. The responsibility of being your own…

Read More

Claiming R&D Tax Relief for Businesses

Limited companies involved in research and development (R&D) activities may be able to claim different types of tax relief against their Corporation…

Read More
Back to Blog...

Confirm Transactions

The number of monthly transactions you have entered based on your turnover seem high. A transaction is one bookkeeping entry such as a sale, purchase, payment or receipt. Are you sure this is correct?

Yes, submit my quote
No, let me change it

Please contact our sales team if you’re unsure

VAT Returns

It is unlikely you will need this service, unless you are voluntarily registered for VAT.

Are you sure this is correct?

Yes, the business is VAT registered
No, let me change it

Call us on 020 3355 4047 if you’re not sure.


You will receive our bookkeeping software Pandle for free, as part of your package.

You can use this to complete your own bookkeeping, or we can provide a quote to complete your bookkeeping for you.

Please select and option below:

I will do my own bookkeeping
I want you to do my bookkeeping

Call us on 020 3355 4047 if you’re not sure.