Payment of Corporation Tax

 

For most companies, the payment of Corporation Tax is due nine calendar months and one day after the end of the accounting period. This is known as the 'Normal Due Date'. If the accounting period ends on the last day of a month, the normal due date will be the first day of the tenth following month. For example, an accounting period ending on 31 May 2002 will have a due date of 1st March 2003.

Large companies must pay their tax earlier than this date, by Quarterly Instalments (see below).

  • If the right amount of tax is not paid by the normal due date, the company may be liable to pay interest on the tax underpaid.
  • It too much tax was paid before the normal due date, the company may be entitled to interest on any repayment due.
  • If tax due is paid before the normal due date, the company may be entitled to interest on the payment because they paid early.

These are general guidelines only. More information can be found in the booklet - A General Guide to Corporation Tax Self Assessment

Payment by Quarterly Instalments

Large companies (typically, those who have profits of over £1.5million) must pay their tax by Quarterly Instalments. There are special rules for companies when they become 'large' so that they do not need to pay by quarterly instalments in the first period for which they are 'large' (unless their profits exceed £10 million).

Your company's accountant or professional advisor will be able to advise you about whether your company needs to pay by Quarterly Instalments.

If your company, or one of the companies in a group of companies, has to pay its tax by Quarterly Instalments, the group can enter into a Group Payment Arrangement with us. This arrangement lets you manage any uncertainty over how much tax individual companies owe, as compared to what the group owes. You will still have to estimate the right amount of tax for the group as a whole, but need not worry about the precise division between the group of companies.

More information and details can be found in:
   
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