Wondering how to pay corporation tax without getting stung by interest or penalties? You pay HMRC online, quoting your 17-character corporation tax payment reference for the correct accounting period. Payment is due 9 months and 1 day after the end of your accounting period, so a company with a 31 March year end must pay by 1 January. The money must reach HMRC by that date, even though your Company Tax Return (CT600) isn't due until 12 months after the period ends.
Miss the date and HMRC charges interest from day one. Pay early and they pay interest to you. Here's how to get it right.
When Is Corporation Tax Due?
For most companies there is a single deadline: nine months and one day after the end of your accounting period (usually your financial year). The return is filed later, but the money is due first.
| Accounting period ends | Payment deadline | Tax return (CT600) deadline |
|---|---|---|
| 31 March 2027 | 1 January 2028 | 31 March 2028 |
| 30 June 2026 | 1 April 2027 | 30 June 2027 |
| 31 December 2026 | 1 October 2027 | 31 December 2027 |
If the deadline lands on a weekend or bank holiday, make sure your payment clears on the last working day before it, unless you use Faster Payments, which can clear the same or next day.
Payment Deadlines for Large Companies
Companies with taxable profits over £1.5 million pay corporation tax in quarterly instalments rather than as a single lump sum, and "very large" companies (profits over £20 million) pay earlier still. These thresholds are divided between associated companies, so groups can fall into instalments sooner than they expect. If you think you're near the line, get advice before your first instalment date.
How to Pay Corporation Tax to HMRC
You need your 17-character corporation tax payment reference, not your 10-digit Unique Taxpayer Reference (UTR). The reference changes every accounting period, so always copy the correct one from your HMRC online account or payslip. Use the wrong reference and HMRC may allocate the payment to the wrong year.
Payment methods, fastest first:
| Method | Time to reach HMRC |
|---|---|
| Online/telephone banking (Faster Payments) | Same or next day |
| CHAPS | Same working day |
| Debit card online | Same or next day |
| Corporate credit card (fee applies) | Same or next day |
| Direct Debit (already set up) | 3 working days |
| Direct Debit (first time) | 5 working days |
| Bacs | 3 working days |
There is no longer a personal credit card option, and you can't pay corporation tax at the Post Office. For the official method list and HMRC's bank details, see GOV.UK's Pay your Corporation Tax bill guidance.
How to Pay Corporation Tax by Bank Transfer
For Faster Payments, CHAPS or Bacs, pay HMRC Cumbernauld using the sort code, account number and your 17-character reference shown in your online account. Always leave a working-day buffer, a payment that bounces back for a wrong reference can tip you past the deadline.
What to Do When There's Nothing to Pay
If your company is dormant or made a loss with no tax due, you still have to tell HMRC there's no payment due for that period, otherwise they'll chase you for a payment that doesn't exist. You do this online or by returning the payslip marked "NIL".
What Corporation Tax Rate Will I Pay in 2026/27?
The amount you owe depends on taxable profit:
| Taxable profit | Rate (2026/27) |
|---|---|
| Up to £50,000 | 19% (small profits rate) |
| £50,000-£250,000 | 25% with Marginal Relief |
| Over £250,000 | 25% (main rate) |
Marginal Relief tapers the effective rate between the two limits, so a company on £100,000 profit pays an effective rate of roughly 22.75%, not the full 25%. Both the £50,000 and £250,000 thresholds are shared between associated companies and reduced pro rata for accounting periods shorter than 12 months. Our corporation tax services include a full Marginal Relief calculation so you pay the right figure, not a rounded-up estimate.
How to Avoid Interest and Penalties
A few habits keep you on the right side of HMRC:
- Diarise the payment date, not the filing date. They're three months apart, and people pay late because they're watching the wrong one.
- Set money aside monthly. Park 19-25% of profit in a separate account so the bill never lands as a shock.
- Don't confuse late-payment interest with penalties. Interest runs automatically from day one of lateness. Separate penalties of £200 or more apply to filing the CT600 late.
- Pay early if you can. HMRC pays credit interest on early payments, modest, but better than nothing.
Late-payment interest is charged at HMRC's published rate, which tracks the Bank of England base rate plus a margin. On a five-figure bill it adds up quickly, so even a few days late is worth avoiding.
Frequently Asked Questions
Can I pay corporation tax in instalments if I'm a small company?
Quarterly instalments are mandatory only for companies with profits over £1.5 million. Smaller companies pay in one go by the 9-months-and-1-day deadline. If you genuinely can't pay, contact HMRC about a Time to Pay arrangement before the deadline rather than simply missing it.
What's the difference between my UTR and my payment reference?
Your UTR is a permanent 10-digit number identifying your company. Your corporation tax payment reference is 17 characters and is specific to a single accounting period. Always pay using the 17-character reference, or HMRC may credit the wrong year.
What happens if I pay corporation tax late?
HMRC charges interest automatically from the day after the deadline until you pay, with no grace period. Persistent or large overdue balances can trigger debt-collection action. There's no separate fixed penalty for paying late, those penalties apply to filing your return late. See our FAQ for more on HMRC interest and penalties.
Do I still need to do anything if my company made a loss?
Yes. You must still notify HMRC that there's no corporation tax to pay for the period and file a CT600 showing the loss. Reporting the loss also lets you carry it back or forward to reduce tax in other years.
Getting the deadline, the reference and the rate right is the difference between a clean payment and an interest bill. If you'd rather hand the calculation, filing and payment timetable to someone who does it every day, get in touch with Zmartly, we'll make sure your corporation tax is paid correctly and on time, every period.
