Changes to Corporation Tax from 2023 – Calculate your increase

Currently all Limited companies in the U.K pay 19% corporation tax on annual profits but this will increase for many businesses from April 2023. For any companies making less than £50,000 profit per year the rate will stay the same at 19%. For any company making over £250,000 profit per year, the rate rises to 25% but there is also an effective tax of 26.5% on any profits above £50,000, up to £250,000.

You can use our handy calculator below to calculate your rate of tax and what the difference is between the current rate of 19% and the new rate.

Frequently asked questions

What is the current rate of corporation tax?

The current rate is 19% and will remain so until April 2023.

What will the rate of corporation tax be from April 2023

Any profits over £250,000 will be taxed at 25%
Any profits between £50,000 and £250,000 will be taxed at 26.5%
Any profits up to £50,000 will be taxed at 19%.

Why is the tax rate higher for earnings between £50,000 and £250,000

This is to ensure that companies earning over £250,000 profits pay 25% tax.
The first £50,000 is taxed at 19%, which comes to £9500 tax.
The next £200,000 is taxed at 26.5%, which comes to £53,000 in tax

Meaning the total tax on the first £250,000 profit is £62,500 (which is a rate of 25%.

How Kudos can help

It’s never been more important to seek advice on your tax return. Here at Kudos we can help you effectively plan for this tax increase by utilising pensions with Kudos Wealth or purchasing assets with Kudos Commercial & Fleet. This will allow you to maximise your tax savings whilst investing in the future of your business.

Contact us today to see how we can help you get ready for next year’s corporation tax increase. 

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