Corporation Tax: Upcoming filing deadlines and reminder about recent amendments

Recent changes HM Revenue & Customs (HMRC) made to the rate of Corporation Tax mainly affected larger businesses in the UK. 

As of April 2023, companies that generate a profit of more than £250,000 during their accounting period will pay a rate of 25 per cent in Corporation Tax, an increase from the 19 per cent that it was previously. 

Smaller businesses that made a profit of £50,000 or less still pay the previous rate of 19 per cent so the recent updates have no impact on them.  

Businesses hovering between £50,000 and £250,000 profits for their accounting periods should be entitled to marginal relief.  

Marginal relief gradually increases the Corporation Tax rate between the 19 per cent smaller profits rate and the 25 per cent main rate.  

Marginal relief means many businesses in this profit bracket will be able to avoid having to pay the full 25 per cent main rate.  

Dividend payments 

The increase in Corporation Tax has added further complexity for large business owners who normally pay themselves and other shareholders in dividends to reduce the tax they pay.  

This complexity has been compounded by HMRC’s recent amendments to the dividend allowance, which has fallen from £2,000 to £1,000 as of 6 April 2023. 

It is now advised that larger business owners assess the number of dividends that they pay to avoid paying more tax than they need to.  

Upcoming Corporation Tax filing deadlines 

Please read below for the upcoming Corporation Tax filing deadlines.  

  • 14 June 2023 – Corporation Tax instalment payments for large and very large companies 
  • 30 June 2023 – Corporation Tax return due for accounting periods ended 30 June 2022
  • 1 July 2023 – Corporation Tax for accounting periods ended 30 September 2022 where not payable by instalments 

For more information about Corporation Tax and advice on how to submit your returns, please contact us.