Corporation tax payment deadlines — 9 months and 1 day, and quarterly instalments for larger companies

Corporation Tax has two deadlines that are easy to confuse. The payment deadline and the Company Tax Return deadline are different dates. For most small companies, Corporation Tax is due 9 months and 1 day after the end of the accounting period, while the Company Tax Return, form CT600, is due within 12 months of the period end. The extra time for filing is not extra time to pay.

Take a worked example. If a company's accounting period ends on 31 March, the payment is due on 1 January of the following year: nine months after 31 March is 31 December, plus one day. The CT600 for the same period is due by the following 31 March. The profit figure should therefore be settled, or well estimated, by the payment date. Late payment can attract interest, and a late return penalties.

For a small company, the practical point is cash planning. The payment date is based on the end of the accounting period, not on when the accounts are signed. If profits have risen, the bill may be larger than last year, and leaving the calculation until December can create an unwelcome surprise. Review the expected profit during the year, set aside funds as profits arise, and check the payment date against the accounting records.

Larger companies pay differently. Companies with taxable profits above £1.5 million pay in quarterly instalments, rather than in a single payment. For a 12-month period, those instalments fall in months 7, 10, 13 and 16 after the start of the period. GOV.UK puts the first instalment at 6 months and 13 days after the first day of the period, then at three-month intervals. For a period starting on 1 April, that gives 14 October, 14 January, 14 April and 14 July.

Very large companies, with taxable profits above £20 million, pay earlier still, in months 3, 6, 9 and 12. For a period starting on 1 April, that means 14 June, 14 September, 14 December and 14 March. These thresholds are annual rates, and they can be reduced proportionately where there are associated companies or a shorter accounting period. There are also exceptions, for example where the total liability is under £10,000. The lesson is simple: do not treat the filing deadline as the payment deadline, and start planning for instalments well before a company grows towards the £1.5 million threshold.