Sarah Bradford outlines how the corporation tax regime is changing from 1 April 2023.
For the financial year 2021 (which started on 1 April 2021), companies pay corporation tax on their profits at a rate of 19%, regardless of the level of those profits. This remains the case for the financial year 2022 (which runs from 1 April 2022 to 31 March 2023).
However, new rules come into effect from 1 April 2023. Consequently, for some companies the rate of corporation tax will, from that date, rise to 25%.
The new regime
From 1 April 2023, there is no longer a one-size-fits-all approach to corporation tax, and the rate at which companies pay corporation tax will depend on the level of their profits. There is something of a sense of déjà vu here, as the post-April 2023 regime looks rather like