Standard payment deadline

Most companies must pay Corporation Tax 9 months and 1 day after the end of their accounting period. This is separate from the filing deadline for the CT600 return, which is 12 months after the accounting period ends.

For example, if your accounting period ends on 31 March 2025, your Corporation Tax payment is due by 1 January 2026, but your CT600 does not need to be filed until 31 March 2026.

Corporation Tax payment deadlines

When to pay Corporation Tax - the 9 months and 1 day rule, with exceptions for large companies requiring quarterly instalments.

Corporation Tax is due 9 months and 1 day after your accounting period ends. This is earlier than the CT600 filing deadline (12 months), so you must pay before submitting your return.

Standard payment deadline: 9 months and 1 day after accounting period ends
Filing deadline (CT600): 12 months after accounting period ends
Example: 31 March year end: Pay by 1 January, file by 31 March following year
Example: 31 December year end: Pay by 1 October, file by 31 December following year
Interest on late payment: Bank of England base rate + 4% (currently 8%)
Repayment interest: Bank of England base rate - 1% (if HMRC owes you)

Large company exception: Quarterly instalments

Companies with profits over £1.5 million cannot wait 9 months - they must pay in quarterly instalments during and after the accounting period.

Quarterly instalment thresholds:

£1.5m - £20m profits: Pay in 4 instalments (months 7, 10, 13, 16)
Over £20m profits: Pay earlier (very large company rules)

Associated companies: The £1.5m threshold is divided by the number of associated companies. With 2 associated companies, the threshold becomes £750,000 each.

Practical payment tips

Set up a tax reserve: Transfer estimated Corporation Tax monthly to avoid cash flow shock
Use HMRC online payment: Fastest method - allows payment up to deadline day
Bank transfers take time: BACS takes 3 working days, Faster Payments is same day
Cheques are risky: Must be received and cleared by deadline - allow 6+ working days
Interest runs from day 1: Even one day late triggers interest charges

Pay your Corporation Tax

How to pay

You can pay Corporation Tax by:

Direct Debit: Set up through your HMRC online account (allows single or variable payments)
Online banking or Faster Payments: Use your Corporation Tax payment reference (17-character code)
CHAPS: Same-day bank transfer for urgent payments
Bacs: Takes 3 working days to process

Payments by cheque or at a bank counter are no longer accepted. Always allow processing time for the payment to reach HMRC before the deadline.

Quarterly instalments for large companies

Companies with annual profits exceeding £1.5 million (adjusted for associated companies) must pay Corporation Tax in quarterly instalments during the accounting period, rather than 9 months after it ends.

Corporation Tax quarterly instalment payment schedule

Quarterly instalment requirements for large companies (profits over £1.5 million).

Large companies must pay Corporation Tax in quarterly instalments rather than in one lump sum. This significantly affects cash flow planning and is often missed by growing businesses crossing the £1.5m threshold for the first time.

Threshold for quarterly instalments: £1.5 million annual profits
Associated companies rule: £1.5m threshold divided equally (e.g., 2 associated companies = £750,000 threshold each)
Very large companies threshold: Profits over £20 million (earlier payment schedule applies)
Amount per instalment: 25% of estimated annual Corporation Tax liability

Payment schedule for £1.5m-£20m profits

Companies with profits between £1.5 million and £20 million must pay Corporation Tax in quarterly instalments on the following schedule:

Instalment 1: Month 7 of accounting period (14 days after end of month 6)
Instalment 2: Month 10 (14 days after end of month 9)
Instalment 3: Month 13 (1 month and 14 days after period end)
Instalment 4: Month 16 (4 months and 14 days after period end)

Example: Company with December year-end and £2m profit

Estimated Corporation Tax: £2m × 25% = £500,000
Per instalment: £500,000 ÷ 4 = £125,000
Instalment 1: 14 July (while still trading - 6 months before year-end)
Instalment 2: 14 October
Instalment 3: 14 February (after year-end)
Instalment 4: 14 May

Cash flow impact: You pay significant Corporation Tax before the accounting period ends - when cash may be tied up in stock, debtors, or reinvested in growth.

Very large companies (over £20m profits)

Companies with profits over £20 million must pay instalments even earlier - starting in month 7 of the accounting period (compared to month 14 for companies in the £1.5m-£20m bracket).

Important: You must estimate profits accurately. HMRC charges interest if you underpay instalments. Missing instalments triggers automatic interest charges (even if unintentional).

Corporation Tax quarterly instalment payments

Late payment consequences

If you pay Corporation Tax late, HMRC charges interest from the day after the payment deadline until the date of payment. There is no separate late payment penalty for Corporation Tax (unlike late filing), but the interest can be significant for large liabilities.

Time to Pay arrangements

If you cannot pay your Corporation Tax on time, contact HMRC before the deadline to discuss a Time to Pay (TTP) arrangement. HMRC may agree to let you pay in instalments over an agreed period, typically 6-12 months.

To negotiate a TTP arrangement, you will need to explain your financial position and propose a realistic repayment schedule. Interest continues to accrue during the arrangement, but HMRC will not take enforcement action while you keep to the agreed terms.

Estimate your liability early

Calculate your expected Corporation Tax liability during the accounting period, not after it ends. This helps with cash flow planning and identifies whether quarterly instalments apply.
Set aside funds monthly

Put aside an estimated portion of your monthly profit for Corporation Tax. A common approach is to set aside 19-25% of pre-tax profits each month into a separate bank account.
Check for quarterly instalment obligations

If your profits exceed the quarterly instalment threshold (adjusted for associated companies), you must pay in four instalments during the accounting period. Missing this obligation results in interest charges.
Pay before the deadline

Allow processing time for your chosen payment method. Faster Payments usually arrive same day, but Bacs takes 3 working days.

Pay your Corporation Tax

Business Context Testing

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Plan your Corporation Tax payments

Standard payment deadline

How to pay

Quarterly instalments for large companies

Late payment consequences

Time to Pay arrangements

Estimate your liability early

Set aside funds monthly

Check for quarterly instalment obligations

Pay before the deadline

Compliance Assistant

🧪 Business Context Testing

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Standard payment deadline

How to pay

Quarterly instalments for large companies

Late payment consequences

Time to Pay arrangements

Estimate your liability early

Set aside funds monthly

Check for quarterly instalment obligations

Pay before the deadline

Related guides in Tax & Finance

Business Context Testing

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