What is the Corporation Tax small profits rate for 2026/27?

Full answer

UK Corporation Tax has used a two-rate structure since **1 April 2023**, replacing the flat 19% rate that was in place from April 2017 to March 2023. **2026/27 Corporation Tax rates:** | Profit level | Rate | |---|---| | Up to £50,000 | **19%** (small profits rate) | | £50,001 – £250,000 | Marginal relief (effective marginal rate: **26.5%**) | | Above £250,000 | **25%** (main rate) | **Marginal Relief formula:** *MR = (£250,000 − augmented profits) × (trading profits ÷ augmented profits) × 3/200* This reduces the CT liability from the 25% main rate down toward the 19% small profits rate — resulting in an **effective marginal rate of 26.5%** through the £50k–£250k band. **Associated companies rule:** If your company has associated companies (companies under common control), the **£50,000 and £250,000 thresholds are divided** by the number of associated companies + 1. Example: You control 2 companies → each has thresholds of £25,000 (small profits) and £125,000 (main rate). **Close Investment-Holding Companies (CIHCs):** Companies that are CIHCs (essentially investment holding companies not actively trading) pay the **main rate of 25%** regardless of profit level — the small profits rate does not apply. **Ring-fenced profits (oil & gas):** Ring-fenced profits from oil and gas extraction have different CT rates — not covered by the standard small profits / main rate structure. **Historical rates:** | Period | Rate | |---|---| | 2017/18 – 2022/23 | Flat 19% | | From 1 April 2023 | 19% (small) / 25% (main) | | 2026/27 | 19% (small) / 25% (main) — unchanged |

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