Marginal Relief for Corporation Tax
You can reduce your Corporation Tax bill through Marginal Relief from 1 April 2023 if your company’s profits are lower than £250,000.
What Marginal Relief is
From 1 April 2023 the Corporation Tax rate changes to:
- 19% for taxable profits below £50,000 (small profit rate)
- 25% for taxable profits above £250,000 (main rate)
Marginal Relief provides a gradual increase in Corporation Tax rate between the small profits rate and the main rate — this allows you to reduce your rate from the 25% main rate.
Who can claim Marginal Relief
Your company or organisation may be able to claim Marginal Relief if its taxable profits from 1 April 2023 are between:
- £50,000 (the lower limit)
- £250,000 (the upper limit)
If your accounting period is shorter than 12 months these limits are proportionately reduced. These limits are also proportionately reduced by the number of associated companies your company has.
For example, if your company has 3 other associated companies, the limits are divided by 4. The lower limit becomes £12,500 and the upper limit becomes £62,500.
Who cannot claim Marginal Relief
You cannot claim Marginal Relief if:
- you’re a non-UK resident company
- you’re a close investment holding company
- your profits (including distributions from unrelated, unassociated companies) go over £250,000
Check how much relief you can claim
You can calculate Marginal Relief for Corporation Tax to check how much Marginal Relief you may be able to claim.
You should only use this service to calculate Marginal Relief on Corporation Tax profits from 1 April 2023.
Updates to this page
Published 1 January 2007Last updated 5 January 2023 + show all updates
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Welsh translation added.
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Use the calculator to check if you can reduce your Corporation Tax bill through Marginal Relief from 1 April 2023.
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The Marginal Relief tool should only be used to calculate marginal relief on corporation tax profits up to 1 April 2015.
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Page updated to provide more guidance on who can claim Marginal Relief and how to claim Marginal Relief for Corporation Tax
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The overview section has been updated to show the new rules 'before 1 April 2015'.
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First published.