This guide explains the basics of how to fill in your Company Tax Return form and work out the Corporation Tax your company or organisation will have to pay.
It highlights items relevant to a small company or organisation with straightforward tax affairs such as a single company trading in the UK only. You should read it along with the 'Company Tax Return form guide' and your Company Tax Return form.
Bear in mind that the boxes on the return form are not always in numerical order. But the box numbers for particular items are the same whether you're using HMRC's free online filing software or commercially available software.
On this page:
To work out the amount of Corporation Tax to pay in an accounting period, you take the pre-tax profit (or loss) figure shown in your company or organisation's accounts and adjust it to arrive at your taxable profits or 'profits chargeable to Corporation Tax'. The Company Tax Return form CT600 enables you to do this and your software may do some of these calculations for you.
All the box numbers mentioned in this guidance refer to boxes on form CT600.
Starting with your company's pre-tax profit figure in your accounts you then:
Put this figure in Box 3.
Put any details of your capital allowances and balancing charges (see the next section below) in Boxes 172, and 105 to 114. These boxes are in the section of the return 'Charges and allowances included in calculation of trading profits or losses'.
You then put any trading losses you've brought forward from an earlier accounting period in Box 4.
Deduct Box 4 from Box 3 and put the result in Box 5. This figure is your net trading and professional profits.
Capital allowances enable you to deduct ('write off') the cost of your company's capital assets such as machinery, computers, equipment or vehicles against your taxable profits for Corporation Tax.
Balancing charges may arise when you sell, give away or stop using a capital item in your business. Balancing charges increase your taxable profits.
When you sell or otherwise dispose of a capital item for more than you paid for it, making a 'capital gain', that gain may be taxable.
If your company or organisation is liable to Corporation Tax, you don't pay Capital Gains Tax separately on any gains. Instead, you pay Corporation Tax on your 'chargeable gains'. In your Company Tax Return you calculate your net chargeable gains and add that to your net income.
You enter your gross chargeable gains, if any, in Box 16.
Then enter your capital losses for your current accounting period and any brought forward from previous accounting periods in Box 17. You can only enter a figure here that's less than or equal to your gains in Box 16.
Deduct Box 17 from Box 16.
If the result is positive or zero, put that figure in Box 18. This is your 'net chargeable gain' figure. You can't have a negative figure in Box 18.
If you've made capital losses for this accounting period, you can't deduct those losses from your profits in the same accounting period. You leave Boxes 16 and 17 blank. Instead, you put the amount of capital losses in Box 131.
You can then 'carry forward' those capital losses to offset against any capital gains you make in a future Corporation Tax accounting period(s). You would include those losses in Box 17 of a future Company Tax Return. You can carry forward capital losses indefinitely.
Add your net trading and professional profits figure in Box 5 to your net chargeable gains figure in Box 18 and then add any other income from the boxes in between. Put this figure in Box 21.
The figure in Box 21 is your figure for 'profits before other deductions and reliefs'.
Note HMRC uses the terms 'deductions' and 'reliefs' for various expenses, losses or allowances that you subtract from your profits before you calculate how much Corporation Tax to pay. This is in contrast to 'credits' or other types of relief that are deducted directly from the amount of Corporation Tax payable. (See also the sections below.)
After subtracting other relevant deductions and reliefs such as trading losses carried back (Box 30), you arrive at your 'profits chargeable to Corporation Tax' figure (Box 37).
You then multiply your Box 37 figure by the relevant Corporation Tax rate(s) to get your gross Corporation Tax chargeable. You can find information about current Corporation Tax rates in the next section of this guide.
If your company or organisation's accounting period spans two HMRC Corporation Tax financial years and different Corporation Tax rates apply in each, you'll need to apportion the company’s taxable profits on a time basis.
If the figure you enter in Box 37 is zero, you must not make an entry in Box 42. If you do, you may have problems submitting your return.
There are currently two rates of Corporation Tax, depending on the company or organisation's taxable profits:
There is also a sliding scale between the lower and upper rates known as 'Marginal Relief'.
If your company or organisation's taxable profits are:
your company or organisation may be able to claim Marginal Relief and so pay less Corporation Tax.
Next, you make any adjustments for reliefs and deductions to your tax payable:
You then arrive at your Corporation Tax payable figure (Box 86).
Box 86 is 'your self assessment of tax payable' before any tax credits or similar. It's the 'bottom line' of your tax calculation.
You claim any tax credits due using the boxes in the 'tax reconciliation' section of the return form.
Corporation Tax credits reduce the amount of Corporation Tax you pay by deducting an amount (the credit) directly from the amount of Corporation Tax you would have paid. If you don't have any Corporation Tax to pay, sometimes you can get a cash repayment.
There are various tax credits available. One is Research and Development (R&D) tax credits for small and medium-sized companies.
You can now show how much Corporation Tax you'll have to pay (Box 92) or should be repaid to you (Box 93). This allows you to reconcile how much Corporation Tax is still payable or repayable.
If your company makes a loss instead of a profit, you can normally choose to:
You put the relevant information in Boxes 122 to 138.
Virtually all companies and organisations must submit their Company Tax Returns online. You must also pay any Corporation Tax that's due electronically.
Additionally, your tax computations and, with very few exceptions, the accounts that form part of your Company Tax Return, must be submitted in Inline eXtensible Business Reporting Language (iXBRL) format.