Corporation Tax: rates of tax
CTA09/S8, CTA10/S3 (2),(3), CTA10/S18
Finance Acts determine the rates of CT chargeable for a financial year (CTM01405).
For financial years up to and including 2014, CTA10/S3 and S18 provide for special rates of CT to be charged on UK resident companies with smaller profits which are not close investment-holding companies (CTM60700 onwards). Broadly this means companies whose profits do not exceed the ‘marginal relief upper limit’ formerly referred to as the ‘upper relevant maximum amount’ (CTM03500 onwards). From the financial year 2015 on, the small profits rate of tax was abolished for companies other than oil and gas companies with ring fence profits.
For financial years 2000 to 2005 ICTA88/S13AA provided for companies resident in the UK which are not close investment holding companies or investment trusts with rental income to pay CT at a lower starting rate where their profits did not exceed the ‘first relevant amount’ (CTM03510)
The rates of CT, and relevant limits and fractions, applicable to smaller profits for the financial year 1989 onwards are detailed at CTM03510.
Where an accounting period straddles 31 March, it will fall partly into two different financial years, in which case:
- the profits are apportioned on a time basis between the two financial years (CTM01405), and
- each portion is charged at the rate for the relevant financial year.
The full rates of CT for the financial years 1989 onwards are shown below. For companies with oil and gas activity ring fence profits these rates differ. The main rate is 30 per cent for financial years 2008 to 2014.
|Financial Year (commencing 1 April in calendar year)||Full Rate|