Archive: 2nd April 2026

Corporation Tax

The marginal Corporation Tax rates

Apr 2, 2026 by Terry Harris 0 Comments

The rate of Corporation Tax payable depends on the level of a company’s taxable profits. The main rate is 25% and applies where profits exceed £250,000. At the other end of the scale, companies with profits of £50,000 or less benefit from the Small Profits Rate, which remains at 19%.

For businesses with profits between these thresholds, marginal relief applies. Rather than facing a sharp increase in tax, companies experience a gradual rise in the effective rate as profits move from £50,000 towards £250,000. This ensures a smoother transition between the lower and higher rates.

It is important to note that the £50,000 and £250,000 thresholds are not always fixed. They are reduced where a company has associated companies or where the accounting period is shorter than 12 months, which can bring more businesses into the marginal relief band.

In practice, Corporation Tax is initially calculated at the main rate of 25%, with marginal relief then deducted to arrive at the final liability. The relief is calculated using a standard fraction of 3/200.

The marginal rates help smaller companies to pay less Corporation Tax based on their profit level and circumstances. 

Source:HM Revenue & Customs | 30-03-2026
Capital Gains Tax

Business Asset Disposal Relief – tax increase from April 2026

Apr 2, 2026 by Terry Harris 0 Comments

The tax rate for Business Asset Disposal Relief (BADR) will increase to 18% (from 14%) on 6 April 2026. BADR offers a reduced Capital Gains Tax (CGT) rate on qualifying disposals such as the sale of a business, shares in a trading company or an individual’s stake in a trading partnership.

These rate increases are accompanied by new anti-forestalling rules designed to prevent individuals from securing the lower BADR rate by using early contracts. Where an unconditional contract is entered into during the 2025-26 tax year but completes on or after 6 April 2026, the disposal will normally be treated as occurring at completion, meaning the higher 18% rate applies. 

However, the legislation allows for “excluded contracts” where the contract was not entered into to secure a tax advantage and, where parties are connected, was entered into wholly for commercial reasons. Where total gains under excluded contracts do not exceed £100,000, the anti-forestalling does not apply.

The lifetime BADR limit remains £1 million meaning individuals can use the relief multiple times, provided their total gains from qualifying disposals do not exceed this threshold. However, the higher CGT rates obviously reduce the tax advantage available. Investors’ Relief CGT rates are currently in line with those for BADR and will also increase to 18% in April 2026.

Source:HM Revenue & Customs | 30-03-2026
General

Action to reduce cost of living pressures

Apr 2, 2026 by Terry Harris 0 Comments

The Chancellor has set out a package of measures aimed at reducing cost of living pressures for households and at the same time strengthening the UK’s longer-term economic resilience. The announcement focuses on tackling rising prices, improving energy security and ensuring markets work fairly for consumers.

A key element is the introduction of an anti-profiteering framework, giving regulators such as the Competition and Markets Authority enhanced scope to act against unjustified price increases. The government has indicated it will not hesitate to introduce targeted, time-limited powers where necessary to clamp down on price gouging and protect working people.

Alongside this, there is a renewed push on energy security. Planned legislation will help secure the delivery of nuclear projects, reduce delays in the planning process and limit the impact of legal challenges on critical infrastructure. The intention is to accelerate domestic energy production and reduce the UK’s exposure to volatile international gas prices.

The Chancellor has also confirmed that options for targeted reductions in agri-food import tariffs will be explored, with the aim of lowering food prices at the point of sale.

These steps build on existing support, including extended fuel duty relief, capped energy bills and targeted assistance for vulnerable households. 

Source:HM Treasury | 30-03-2026