Limited Company Tax | Business At

Limited company tax involves significant changes for the 2026-2027 tax year that affect compliance and efficiency for UK business owners.

This article outlines incorporation relief, corporation tax rates, filing updates, Companies House fees, and new reporting requirements to help you navigate your tax obligations.

Defer Capital Gains with Incorporation Relief

Incorporation relief allows deferral of capital gains tax when transferring a business to a company in exchange for shares.

The relief is automatic for going concern transfers, and you can opt out by notifying HMRC if it is not advantageous.

The base cost of shares is reduced by the deferred gain for future tax calculations.

Navigate Current Corporation Tax Rates

Corporation tax rates and allowances have been updated for the 2026-2027 tax year.

Marginal relief is available for companies with profits between £50,000 and £250,000, replacing the single rate system from 2023.

Understanding these rates is essential for accurate tax planning and compliance.

Adapt to New Tax Filing Methods

The HMRC online service for filing company accounts and tax returns closed on 31 March 2026.

From 1 April 2026, companies must use commercial software to file with HMRC, while still submitting accounts to Companies House separately.

Paper returns are only allowed in specific cases, such as filings in Welsh or with a reasonable excuse.

Prepare for Updated Companies House Fees

Companies House fees increased from 1 February 2026, with digital filing costs rising.

The incorporation fee is now £100, confirmation statement fee is £50, and voluntary strike off fee is £13.

These changes fund enforcement activities and aim to reduce economic crime under new legislation.

Manage New Reporting for Close Companies

HMRC is consulting on new reporting requirements for transactions between close companies and their participators.

Close companies, often small businesses controlled by few individuals, may face added complexity in tax reporting.

The proposal aims to address a Corporation Tax gap of £14.7 billion for 2023-2024, with consultation running until June 2026.

Ready to Optimise Your Limited Company Tax?

Sources:

• HS276 Incorporation Relief (2025 to 2026) Roll-over relief on transfer of a business - GOV.UK
• Rates and allowances for Corporation Tax - GOV.UK
• Filing company accounts and tax returns if you previously used the HMRC online service - GOV.UK
• Companies House fees are changing from 1 February 2026 - GOV.UK
• Reporting company payments to participators — modernising the reporting framework - GOV.UK