Companies with large profits must pay Corporation Tax 'electronically' in instalments. You can also pay online, by telephone banking, or other methods (e.g. Bacs, CHAPS, cheque, Direct Debit).
HM Revenue and Customs base the deadlines for corporate tax payments on taxable profits made by the company.
As a limited company or organisation, you need to pay your Corporation Tax bill on any profits by nine (9) months and one (1) day after the end of your accounting period.
As a rule, an accounting period is the same as a financial year. But, you could have two accounting periods in your limited company's first accounts and Company Tax Return.
Some companies, generally the larger ones, must pay Corporation Tax in instalments. A 'large' company refers to one with annual profits above the upper limit for the accounting period in question. Even so, some exceptions do apply.
Your company must ensure all payments reach the bank account of HM Revenue and Customs (HMRC) before the deadline date. The method you use for Corporation Tax payment will determine how much time you need to allow for clearance.
Note: Under new Corporation Tax rules you can no longer pay the bill by postal methods or at the Post Office.
Weekends and UK Bank Holidays do not count as working days. Make sure the payment reaches HMRC account on the last working day before (unless using the 'Faster Payments' method).
You can use CHAPS, Bacs, or Faster Payments to pay HM Revenue and Customs. The payslip sent to you by HMRC informs you which account to use. Use the Cumbernauld account if you are still unsure.
|Account Name||Sort Code||Account Number|
You will have a 17-character Corporation Tax payslip reference. Quote this number for the accounting period that you are paying. You can find your payslip reference number:
Note: Using the wrong reference number is likely to delay the clearance of your payment.
Online or telephone banking (using Faster Payments) usually reach HMRC account the same day or the following day. This includes weekends and bank holiday periods in the United Kingdom.
CHAPS payments should go into the HMRC account on the same working day. But, they must be made within the bank processing cut-off time. As a rule, Bacs transactions take 3 working days to clear.
Note: Every bank has its own processing limits and processing cut-off times. Check these limits and times before planning a date to send bill payments.
You should use these bank details if you will pay your Corporation Tax bill from an overseas account.
|Account Number (IBAN)||Bank Identifier Code (BIC)||Account Name|
You can make one single payment to cover several different companies for the same accounting period. If so, use the online CHAPS enquiry form to get further details. The banking address for HM Revenue and Customs is:
Barclays Bank PLC
1 Churchill Place
You can pay tax online by entering your payment details into the system. There is a non-refundable fee for paying by corporate credit card. You may need to use one of the other payment methods for Corporation Tax if the card does not cover the full amount.
Note: You cannot pay this kind of tax bill with a personal credit card. Using the wrong reference number will delay the transaction.
You should allow three (3) working days for the payment to reach the bank account of HM Revenue and Customs.
Note: You can pay your tax bill by debit or credit card after setting up the payment system with HMRC.
You can make the bill payment at a bank or building society branch by cash or by cheque. Remember to use the payslip that you got from HM Revenue and Customs and allow three working days for the transaction.
If you choose to pay by cheque make it payable to 'HM Revenue and Customs only' followed by your 17-character Corporation Tax payslip reference for the accounting period that you are paying.
Note: If you do not have a payslip you would need to pay by another method instead, such as by:
You can use your company HMRC online account to set up and to make changes to a Direct Debit. Use your 17-character payslip reference for the accounting period that you are paying.
You should allow five (5) working days for processing for the first time you set up a Direct Debit. It should then take three (3) working days once it gets authorised as a Direct Debit through HMRC. Your bank statements will show the payment as 'HMRC NDDS'.
Note: You would be able to pay your tax bill by Direct Debit after setting up the payment system with HMRC.
Making joint payments is a way for a group of companies to save money on Corporation Tax bills. So, you can pay corporate taxes under Group Payment Arrangements if your company is in a group. In this case, HM Revenue and Customs would send you the correct payslip reference by letter.
If you do not tell HM Revenue and Customs that you have nothing to pay, they will send payment reminders to you. Even so, you still need to file your company tax return. Tell HMRC by (either):
You can check whether HM Revenue and Customs received your payment (or not) in your HMRC online account. As a rule, it only takes them a few days to update the account once they receive the payment.
Note: The short video presented by HM Revenue and Customs (HMRC) explains the current Corporation Tax deadlines and how to make payments (e.g. using a Business Tax Account).
Different Ways to Pay Corporation Tax in the United Kingdom