How to pay Corporation Tax: deadlines, payment methods and your reference

Paying Corporation Tax on time means the money reaches HMRC 9 months and 1 day after the end of your company’s accounting period, if its taxable profits are up to £1.5 million. Companies with larger profits pay in instalments, covered further down.

As a worked date, an accounting period that ends on 31 March has a payment date of 1 January. What counts is the day the payment reaches HMRC, not the day you send it, so the method you choose decides how early you need to act.

The Company Tax Return has a later deadline: 12 months after the end of the accounting period it covers. The payment date therefore arrives first, so agree the figure with your accountant in time for the earlier of the two dates.

You pay Corporation Tax by bank transfer, Direct Debit, card or at your own bank, and a payment takes between the same day and 5 working days to reach HMRC depending on the method. HMRC says plainly that you cannot pay Corporation Tax by post, and the Post Office is not on its current list of ways to pay.

HMRC’s bank details are on GOV.UK’s “Pay your Corporation Tax bill” pages, listed in the sources below. If you are paying from an overseas account, HMRC asks for the payment in sterling.

Each of these three methods has a condition that catches companies out close to the deadline.

Direct Debit

You set the Direct Debit up through the company’s HMRC online account. Allow 5 working days for it to be processed the first time, and 3 working days each time you pay once you have authorised a Direct Debit from HMRC. It appears on your bank statement as “HMRC NDDS”, and it cannot be used for a payment of more than £20 million.

Debit and credit cards

There is a fee if you pay by corporate credit card or corporate debit card, and the fee is not refundable. There is no fee for a personal debit card. You cannot pay with a personal credit card.

Your bank or building society

You can only pay at your branch by cash or cheque if you have a paying-in slip from HMRC. Make a cheque payable to “HM Revenue and Customs only” and write the 17-character payment reference on the back.

You use the 17-character Corporation Tax payment reference for the accounting period you are paying. The reference changes with each accounting period, so last year’s number will not do for this year’s bill.

You can find the reference in three places:

• The “notice to deliver your tax return” that HMRC sends
• Any payment reminders from HMRC
• The company’s HMRC online account, once you select the accounting period

VAT uses a different reference and has its own payment rules, which we set out in our guide to paying a VAT bill.

You check the company’s HMRC online account, which HMRC says should be updated within a few days of the payment being received. Keep your bank’s confirmation until the account shows the payment against the right accounting period.

If the company has nothing to pay, HMRC still expects to hear from you. Its guidance says you must tell HMRC by filling in the “nil to pay” form, and you must still file the Company Tax Return. Otherwise HMRC sends payment reminders.

Yes: a company with profits at an annual rate of more than £1.5 million pays electronically in instalments, not in one sum after the year end. HMRC calls a company “large” where that annual rate is more than £1.5 million but less than £20 million.

For a 12-month accounting period, a large company pays four equal instalments:

• 6 months and 13 days after the start of the accounting period
• 3 months after the first instalment
• 3 months after the second instalment
• 3 months and 14 days after the end of the accounting period

Very large companies, with profits at an annual rate above £20 million, start earlier: 2 months and 13 days after the first day of the accounting period, then quarterly. A large company does not need to pay by instalments if its total liability is under £10,000, or in the first year it becomes large if its profits do not exceed £10 million. The thresholds are divided between associated companies, so ask your accountant which side of the line your company sits on.

HMRC may charge interest if you do not pay on time, and its late payment interest rate is 7.75% from 9 January 2026. The rate is set at the Bank of England base rate plus 4 percentage points, so it changes when the base rate does. Check HMRC’s interest rates page for the figure on the day you read this.

• Interest on underpaid quarterly instalments is set separately: 6.25% from 29 December 2025.
• HMRC pays interest on Corporation Tax paid early: 3.50% from 29 December 2025.
• Filing the Company Tax Return late is penalised separately, starting at £200 one day after the filing deadline.

The guidance we relied on describes interest on late payment. It does not set out a separate penalty for paying Corporation Tax late, so ask HMRC or your accountant about your own position.

If you cannot pay the bill in full, you may be able to set up a payment plan with HMRC, known as Time to Pay, and pay in instalments. HMRC checks that the plan is affordable, and it has no fixed time limit: the length depends on how much you owe and what you can afford each month.

HMRC’s guidance is direct about what it expects of a company first:

• The company must reduce the debt as much as possible before setting up a plan, for example by releasing assets such as stock, vehicles and shares.
• You need the tax reference, UK bank details for a Direct Debit and details of the company’s finances.
• HMRC may ask company directors to put personal funds into the business, accept lending or extend credit.

Interest continues while you pay, which is why HMRC says that paying the debt quicker means paying less in total. Contact HMRC as soon as you know the money will not be there. Our guide to how HMRC Time to Pay works covers what to have ready before you call.

Yes, some business lenders offer short-term loans that pay the bill by the deadline and are repaid in monthly instalments, subject to status and lender criteria. A loan adds interest and fees to the tax the company already owes, so it is a way to change the timing, not to reduce the cost.

The bill covers a year’s profit but falls due on a single day, which is hardest on companies that are paid in arrears, such as the practices described on our page about finance for professional services firms. If the company is sound and the problem is only timing, borrowing can be reasonable. If the company could not afford the repayments, a loan moves the problem and Time to Pay is the conversation to have.

Put the two routes side by side in pounds before choosing. The full comparison, including what lenders ask for, is in our guide to Corporation Tax loans.

Capzy is a credit broker, not a lender, and is paid by the lender. We do not collect tax, arrange Time to Pay or give tax advice: paying the bill is between your company and HMRC.

If you want to know what borrowing would cost before you decide, you can check your funding options with a soft search that does not affect your credit score. A full application to a lender may involve a hard search, and any offer is subject to status and lender criteria. The other business finance guides explain the funding side in more detail.