The complete picture of limited company tax for 2026/27: corporation tax, paying yourself, VAT, PAYE, the filing duties and how to stay compliant.
Running a limited company opens up real tax advantages, but it also brings a set of taxes and deadlines that do not apply to a sole trader. Knowing what your company has to pay, and when, is the key to staying compliant and keeping more of your profit. This guide gives you the complete picture of limited company tax for the 2026/27 year.
A company can encounter several taxes. Corporation tax is paid on its profits. If it employs anyone, including you on a salary, it operates PAYE and pays employer National Insurance. If its turnover is high enough, it must register for and charge VAT. And when you take profit out as dividends, you pay dividend tax personally. Understanding how these fit together is what good planning is all about.
Corporation tax is the main company tax, charged at 19% on profits up to £50,000 and 25% above £250,000, with marginal relief in between, for 2026/27. It is due 9 months and 1 day after your accounting period ends, and the return follows later, so you pay before you file. Claiming all allowable costs and capital allowances keeps the bill down.
How you take money out of the company affects your overall tax. Most directors use a mix of a small salary, which is a deductible cost for the company, and dividends, which are taxed at lower personal rates after a £500 allowance. Getting the balance right, taking account of National Insurance and the dividend rates that rose from April 2026, is one of the most valuable pieces of planning for a company owner.
If your company's VAT taxable turnover goes over £90,000 in any rolling 12 months, it must register for VAT, charge it on its sales and file regular returns under Making Tax Digital. Some companies register voluntarily below the threshold to reclaim VAT on their costs. Choosing the right VAT scheme can save both money and time.
As soon as the company pays a salary, to you or to staff, it runs a payroll and operates PAYE, deducting income tax and National Insurance and reporting to HMRC each payday. The company also pays employer National Insurance, although the Employment Allowance can reduce this for companies that qualify.
A company has several filings each year. It must prepare annual accounts and file a version at Companies House, file a corporation tax return and accounts with HMRC, and file a confirmation statement to keep its public details current. These have different deadlines tied to your company's own dates, which is exactly the kind of thing it pays to have tracked for you.
Good records underpin everything. A company must keep accounting records, details of what it owns and owes, and a record of income and expenses. Cloud accounting software makes this far easier and is becoming essential as more of the tax system moves online.
Corporation tax on profits, employer National Insurance and PAYE if it employs anyone, VAT if registered, and dividend tax is paid personally by shareholders on dividends.
19% on profits up to £50,000 and 25% above £250,000 for 2026/27, with marginal relief in between.
Usually a small salary plus dividends, balanced to use allowances and keep National Insurance low, but the ideal mix depends on your figures.
Annual accounts at Companies House, a corporation tax return and accounts with HMRC, and a confirmation statement, each with its own deadline.
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