Currently all companies, regardless of the size of their profits, pay corporation tax at the rate of 19%, which will continue until 31 March 2023.

From 1 April 2023, a new higher rate comes into effect for companies with profits over £50,000. They will face a significant increase and must pay corporation tax at a rate of 25%.

All companies with profits below £50,000 will continue paying the 19% rate of corporation tax.

Depending on the circumstances, if a company’s profits lie between £50,000 and £250,000, it may be possible to claim some marginal tax relief to reduce the 25% rate.