Starting a business is exciting, but it comes with a checklist of essential steps—including making sure your business is registered for Corporation Tax. 

What is Corporation Tax? 

It’s a tax on the profits a Limited (Ltd) company makes. Every UK-based business that’s up and running and operating as a Ltd company must be on HMRC’s radar. 

Ensuring your business is registered for Corporation Tax is required to comply with HMRC’s legal obligations. Failing to register or missing deadlines can result in fines, eating into your hard-earned profits.

This guide will walk you through the process, so you know exactly what’s involved in ‘registering’ for Corporation Tax. 

A more detailed explanation of Corporation Tax

Corporation Tax is a mandatory tax that UK-based companies pay on their profits from these activities - doing business (trading profits), investments, and selling assets for more than was paid for them (chargeable gains).

Essentially, if your business is generating profit, it’s liable to pay Corporation Tax on the income after deducting allowable business expenses. 

This tax applies to:

• limited companies,
• foreign companies with a UK branch or office,
• certain unincorporated associations like clubs and societies.

The rate for Corporation Tax can vary, so it’s essential to stay updated with HMRC’s current rates. Businesses need to calculate and report their profits for each accounting period, typically aligning with their financial year. 

Similar to personal tax, companies also receive correspondence from HMRC and are required to self-assess and pay their taxes within nine months and one day after the end of their accounting period. Staying aware of these details is crucial to avoid late payments and the penalties that come with them.

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Corporation Tax Rates Explained

Key Points:

• Small Profits Rate (19%): Applies to companies with profits up to £50,000.
• Main Rate (25%): Applies to companies with profits above £250,000.
• Marginal Relief: Provides a gradual increase in the Corporation Tax rate for companies with profits between £50,001 and £250,000, effectively smoothing the transition from the small profits rate to the main rate.

These rates are set to remain consistent for the 2024/2025 and 2025/2026 financial years, as per the latest UK budget announcements.

For companies with associated entities, the profit thresholds are proportionately reduced. It's essential to stay informed about any future changes to Corporation Tax rates by consulting official HMRC resources or seeking professional tax advice.

How do I register for Corporation Tax?

You might be surprised to learn that there isn’t a separate process to register for Corporation Tax. When you (or a formation agent on your behalf) register your Limited company with Companies House, you’ll automatically be ‘registered’ for Corporation Tax too. 

HMRC will then send a confirmation letter with your Corporation Tax Number (or Unique Taxpayer Reference). Keep this number safe—it’s essential for your future tax filings and correspondence, including submitting your Corporation Tax Return (which is a legal requirement for all Ltd companies, even if the business doesn’t make a profit).

How can I register to view Corporation Tax in my Government Gateway account? 

While the process of registering for Corporation Tax happens automatically when you register your business with Companies House, it’s not automatically connected to your Government Gateway account. 

To view your Corporation Tax details, you’ll need to manually link it to your account.

Here’s how:

1. Set Up a Government Gateway Account
   If you haven’t already, head to HMRC’s website and create a Government Gateway account. This gives you secure access to online tax services. If you already have a Government Gateway ID but aren’t sure how to find it, refer to our article, “What is a Government Gateway ID and where to find it.”
2. Access the Corporation Tax Registration Service
   Log into your Government Gateway account and select ‘Enrol for service’.
3. Provide Your Company Details
   Complete the form by inputting essential information such as your company registration number, start date of trading, and your corporation tax number. Ensure that these details match those on your company records to avoid processing delays.
4. Submit the Form
   Double-check your entries for accuracy, then submit the form. Once HMRC receives it, they will send you an authorisation code in the post for security purposes. You can then enter this code into your government gateway account to complete the link and your corporation tax data will be accessible.

Although it’s not necessary to do this, many businesses opt to do so as it gives them a clearer overview of their Corporation Tax.  

Confirmation and next steps

Once you’ve submitted your registration with Companies House, HMRC will send a confirmation letter containing your Corporation Tax Unique Taxpayer Reference (UTR). This process typically takes a few weeks, so keep an eye on your mail. 

Your UTR is essential for filing your tax returns and managing your Corporation Tax obligations. After receiving your UTR, the next step is maintaining detailed records of your income, expenses, and profits. You’ll need to submit your Company Tax Return annually, within 12 months of your accounting period’s end. However, HMRC does require payment to be received within 9 months and 1 day of the period end.

Even if your business makes no profit, you’ll still need to file a Corporation Tax Return—you just won’t pay any tax. Staying proactive helps avoid penalties and ensures your business stays compliant.

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Corporation Tax summarised

Although there’s no formal process to “register” for Corporation Tax,  it’s vital to make sure your Limited company is correctly registered with Companies House. If you’ve done this, you should receive your Corporation Tax Number within a few weeks.

Learning how Corporation Tax works, preparing the right information, and following the necessary steps, will make Corporation Tax filing easier.  The most important takeaway is that timely registration and maintaining accurate records are key to staying on top of your obligations. 

With the Corporation Tax ‘registration’ complete, you’re one step closer to running your business smoothly and focusing on what you do best—making it thrive.

Need your year-end accounts and Corporation Tax filed? 

At Crunch, our Corporation Tax accountants handle everything for your Ltd company. You can enjoy peace of mind knowing your annual accounts are in expert hands, allowing you to focus on what you do best—running your business.

Interested? Book a call with our advisors to see how we could help make your Limited company accounting easier.

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