How and When to Pay Corporation Tax: 2026/27 Guide

A company with taxable profits up to £1.5 million normally pays Corporation Tax nine months and one day after the end of its accounting period. Larger companies may have to pay by quarterly instalments.

This guide focuses on how to pay, which reference to use and how long payment methods take. For a comparison of all filing dates, see our Corporation Tax deadline guide.

When is Corporation Tax paid?

For most small and medium-sized companies, cleared funds must reach HMRC nine months and one day after the accounting period ends.

Example: an accounting period ending 31 March 2027 normally produces a payment deadline of 1 January 2028. Because payment deadlines can fall on a weekend or bank holiday, the company must choose a payment method that reaches HMRC on time.

Companies paying by instalments

HMRC applies different payment dates to companies whose taxable profits exceed the instalment thresholds. The headline threshold begins at £1.5 million, with separate rules above £20 million.

Thresholds are adjusted for:

• short accounting periods;
• associated companies; and
• certain first-year and profit-level exceptions.

A group with several associated companies can enter the instalment regime at a much lower profit per company. Forecast the position during the year.

How to pay Corporation Tax

GOV.UK lists several methods. Current indicative clearing times are:

HMRC does not accept Corporation Tax payments by post. Check GOV.UK immediately before paying because services and processing times can change.

Use the correct payment reference

Use the 17-character Corporation Tax payment reference for the accounting period being paid. It can be found on the notice to deliver the Company Tax Return, HMRC reminders or the company’s online tax account.

The reference normally changes for each accounting period. Reusing an old reference can cause the payment to be allocated to the wrong period and make the current account appear overdue.

Bank-holiday and weekend deadlines

Where a deadline falls on a weekend or bank holiday, GOV.UK says payment should reach HMRC on the last working day before it, unless the company pays through Faster Payments using online or telephone banking. Do not initiate a slow method on the deadline date.

How much should the company pay?

Estimate taxable profit, then apply the appropriate Corporation Tax rates and reliefs. The amount is based on taxable profit, not simply the accounting profit shown in statutory accounts.

Adjustments can include disallowable expenses, capital allowances, losses, group relief, chargeable gains and marginal relief. A company should calculate the liability early enough to meet the payment date, even though the CT600 filing deadline is normally three months later.

Paying early or late

HMRC may pay interest on Corporation Tax paid early. It charges interest on late payment. Interest does not replace other consequences where a return is filed late.

If the company cannot pay on time, contact HMRC as early as possible. A Time to Pay arrangement is not automatic and depends on the company’s circumstances.

How to check payment

Allow the stated processing time, then check the company’s HMRC online account. Retain the bank confirmation, amount, date, reference and accounting period. If the payment is missing, contact HMRC with those details rather than sending a duplicate immediately.

No Corporation Tax due

If HMRC expects payment but the company has no Corporation Tax liability, follow the GOV.UK process to report that no payment is due. A nil liability does not automatically remove a notice to file the CT600.

Common payment mistakes

• using the filing deadline as the payment deadline;
• using a reference from the previous accounting period;
• forgetting that a long first set of accounts can create two tax periods;
• overlooking associated companies when testing instalment thresholds;
• paying by a slow method too close to the deadline;
• assuming a bank confirmation means HMRC allocated the payment correctly; and
• sending a second payment before tracing the first.

Frequently asked questions

Can Corporation Tax be paid by personal card?

GOV.UK provides an online debit and corporate credit-card service. Check the accepted cards, fees and current conditions before paying.

Can Corporation Tax be paid in instalments voluntarily?

A company outside the mandatory quarterly regime can make payments before the deadline, but that is different from an agreed Time to Pay arrangement for overdue or unaffordable tax.

Is the payment reference the company UTR?

No. The payment reference incorporates period-specific information and is 17 characters. Use the reference shown for the relevant period.

Official source

Use GOV.UK: Pay your Corporation Tax bill immediately before making payment.