Budget 2013 Reaction and Analysis: Corporation Tax

Rates of corporation tax

From 1 April 2013, the main rate of corporation tax will be 23% and from 1 April 2014 it will be cut to 21%.  The small profits rate is to remain at 20% throughout the same period.

From 1 April 2015, the corporation tax main rate will be aligned with the small profits rate and set at 20%.  Hence there will be a single rate of tax for all companies irrespective of their level of taxable profits.

The small profits rate applies where profits are less than £300,000 and the main rate applies where profits exceed £1,500,000.  These thresholds will become less important in future, but will still be relevant to determining whether Quarterly Instalment Payments are payable.