Corporation tax

Corporation tax rates and bands are as follows:

Financial year to 31 March 2017 31 March 2016
 Taxable profits 20% 20%
 Tax credits on dividends N/A 10% 
 Loans to participators rate 32.5%  25%
 Diverted profits tax 25% 25%

Corporation tax payable

For small and medium sized companies

  • Nine months and one day after the end of the accounting period

For large companies

  • Instalments:

The 14th day of the seventh, tenth, 13th and 16th months after the commencement of a 12 month accounting period.

  • Balance:

Nine months and one day after the end of the accounting period.

Beyond 31 March 2017

In Autumn Statement 2016 the government reaffirmed its commitment to reducing the rate of corporation tax to 17% by 2020.

From 1 April 2019 companies with taxable profits of £20 million or more will be required to pay corporation tax in quarterly instalments in the third, sixth, ninth and twelfth months of their accounting period. The £20 million threshold will be divided by the number of companies in the group.

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