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ACCA Strategic Professional · Advanced Taxation (UK) · Corporation tax: taxable total profits

For the financial year 2025, which of the following correctly states the corporation tax rates and limits that apply to a company that is not part of a group and has no associated companies?

The small profits rate of 19% applies to profits up to £50,000 and the main rate of 25% applies above £250,000. Profits between those limits receive marginal relief. These are the FY2025 figures for a standalone company with no associated companies.

  1. ASmall profits rate 19% up to £50,000; main rate 25% above £250,000; marginal relief betweenCorrect
  2. BSmall profits rate 19% up to £50,000; main rate 25% above £150,000; marginal relief between
  3. CSmall profits rate 20% up to £50,000; main rate 25% above £250,000; marginal relief between
  4. DSmall profits rate 19% up to £250,000; main rate 25% above that amount with no marginal relief

Explanation

For FY2025 the small profits rate is 19% with a lower limit of £50,000, the main rate is 25% and the upper limit is £250,000. Marginal relief applies to profits between the limits. The £150,000 option wrongly halves the upper limit, which is what applies with one associated company.

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