Every active UK limited company must file a corporation tax return (CT600) with HMRC each year, whether or not it made a profit. For non-resident founders, understanding the filing deadlines, payment deadlines, applicable tax rates and penalty regime is the foundation of avoiding unnecessary compliance costs. This guide covers everything you need to know for 2026.
2026 Corporation Tax Key Numbers
- Small profits rate (profits ≤ £50,000): 19%
- Main rate (profits ≥ £250,000): 25%
- Tax payment deadline: 9 months and 1 day after accounting period end
- CT600 filing deadline: 12 months after accounting period end
- First late filing penalty: £100 (day 1)
What Is a Corporation Tax Return (CT600)?
A CT600 is the corporation tax return that UK limited companies must submit to HMRC for each accounting period. It reports the company's taxable profits and calculates the tax liability due.
The CT600 must be filed alongside:
- Statutory accounts (Company Accounts): Profit & loss statement and balance sheet in an acceptable format
- Supplementary pages: Where applicable — e.g., for R&D tax credits, capital allowances, or group relief
CT600 must be filed electronically through HMRC's online service or HMRC-approved software. Paper returns are not accepted.
Two Deadlines: Payment vs Filing
Many founders confuse these two deadlines — they are different, and the payment deadline comes first:
| Obligation | Deadline | Example (accounting period ending 31 Dec 2025) |
|---|---|---|
| Pay corporation tax | 9 months and 1 day after accounting period end | 1 October 2026 |
| File CT600 | 12 months after accounting period end | 31 December 2026 |
The key insight: pay first, file later. This means your tax payment must be made before the return is even due. Late payment triggers daily interest even if the return is eventually filed on time. Start preparing your accounts as soon as possible after the accounting period ends to give yourself time for both deadlines.
Large companies (annual profits above £1.5m) must pay quarterly instalments — this guide focuses on the standard process for smaller companies.
2026 Corporation Tax Rates Explained
The UK uses a progressive corporation tax structure for 2026:
| Annual Taxable Profit | Rate |
|---|---|
| Up to £50,000 | 19% (small profits rate) |
| £50,001 – £249,999 | Marginal rate (19%–25% progressive) |
| £250,000 and above | 25% (main rate) |
Associated companies reduce thresholds. If you control multiple companies, the £50,000 and £250,000 thresholds are divided equally among all associated companies. Two associated companies each get a £25,000 small profits threshold. This is a common blind spot for founders with multi-company structures.
What You Need to Prepare
- Full company accounts: Profit & loss and balance sheet, prepared to UK GAAP, FRS 102, or FRS 105 standard
- Income and expense records: All bank statements, invoices, and receipts for the accounting year
- Payroll records: PAYE records including director salary and employer NI contributions
- Asset register: If you own fixed assets, you'll need depreciation and capital allowances calculations
- HMRC Business Tax Account: Your company must be registered for corporation tax with HMRC; access via Government Gateway
How to File CT600
Option 1: HMRC Online Filing (Free)
HMRC's free online service allows direct submission for straightforward cases. You'll need your Government Gateway credentials and your company's Unique Taxpayer Reference (UTR).
Option 2: Accountant or Tax Software
Most small companies use an accountant with professional software (Xero Tax, IRIS, Sage) to handle both the accounts preparation and CT600 submission together. An accountant can also identify deductions that typically save more than the fee charged. UK small company accounting and tax typically costs £500–£2,000 per year depending on complexity.
Common Allowable Deductions
The following expenses can be deducted when calculating taxable profit (provided they are wholly and exclusively for business purposes):
- Staff salaries and employer NI (including director salary)
- Office rent, utilities (or a proportion of home office costs)
- Business travel (not commuting)
- Professional fees: accountants, lawyers
- Software and SaaS subscriptions (business use)
- Equipment via Annual Investment Allowance (AIA — £1,000,000 limit in 2026)
- R&D expenditure (may qualify for R&D Tax Credits)
- Loan interest (on business-purpose borrowing)
Dividends are not a deductible business expense — they are a post-tax distribution of profit.
Late Filing Penalties & Interest
| How Late | Penalty |
|---|---|
| 1 day late (filing) | £100 |
| 3 months late (filing) | Additional £100 |
| 6 months late (filing) | 10% of estimated unpaid tax |
| 12 months late (filing) | Further 10% of unpaid tax |
| Late tax payment | Daily interest ~7.25% p.a. (2026 rate) |
If you file late two years in a row, the £100 fixed penalties increase to £500. HMRC may also raise a "determination" — an estimate of what you owe — which is usually higher than the actual liability and difficult to dispute until a real return is filed.
Common Mistakes to Avoid
- Confusing payment and filing deadlines: Waiting for the filing deadline to pay tax means months of accrued interest
- Forgetting to register with HMRC: New companies must notify HMRC within 3 months of starting to trade or having taxable income
- Miscalculating associated company thresholds: Multi-company founders who wrongly apply full thresholds to each company may underpay tax
- Missing allowable deductions: Not recording home office apportionment, travel, and software subscriptions that are legitimately deductible
- Treating dividends as expenses: Dividends cannot reduce taxable profit
Register Your UK Company Today
After registration, you have 3 months to notify HMRC for corporation tax. From £2.99, same-day registration available.
Register a UK CompanyFAQs
When is my first corporation tax return due?
Your company's first accounting period typically starts on the date of incorporation and ends on the last day of the month, up to 12 months later (set automatically by Companies House). Tax payment is due 9 months and 1 day after the period ends; the CT600 is due 12 months after it ends. If the first period is shorter than 12 months, the same calculation applies from its end date.
Does a dormant company need to file CT600?
Companies formally notified to HMRC as dormant and with no taxable activity are generally exempt from CT600 filing, but must still file dormant accounts with Companies House annually. If a dormant company receives bank interest or any other income, it is no longer fully dormant and must file normally.
Do I need an accountant to file my CT600?
Not legally, but it is strongly recommended. Beyond compliance, accountants identify allowable deductions that routinely save more than their fee. UK small company accounting and tax services typically cost £500–£2,000 per year depending on company complexity.