Corporation Tax Explained: A Guide for Business Owners

20/10/2025

For many new business owners, filing and paying corporation tax can feel unfamiliar and complex. Most new business owners have limited prior experience managing this type of tax. At Turbin and Turbin, we provide expert guidance to help businesses navigate their corporation tax obligations efficiently and with confidence. 

Corporation tax is a tax on the profits of incorporated entities. It is reported to HMRC through a Company Tax Return (CT600). Unlike personal income tax, which is calculated over the standard tax year (6 April to 5 April), corporation tax is calculated over a company’s accounting period, which may vary between businesses.

While limited companies are the primary entities affected, corporation tax can also apply to clubs, societies, and unincorporated associations. Many committees and management teams are often surprised to learn that these types of organisations may have corporation tax obligations.

Corporation tax applies to all profits generated by the entity, including:

• Trading profits from day-to-day business activities

• Investment income

• Gains from the sale of business assets

Starting next year, significant changes will affect how company tax returns are submitted. The joint filing system, which allowed businesses to file returns simultaneously with HMRC and Companies House, will be discontinued.

Going forward, companies will be required to submit their CT600 returns through approved commercial software, in line with the UK’s digital tax initiatives.

Maintaining accurate financial records is essential to meet corporation tax obligations. This includes documenting all income, expenses, and asset transactions.

At Turbin and Turbin, we assist businesses at every stage of record-keeping—whether that means refining existing processes or implementing a full bookkeeping system from scratch. We can ensure that all records are accurate, organised, and compliant.

Corporation tax returns must be filed within 12 months of the end of a company’s accounting period. Late submission or payment can result in penalties, making it critical for business owners to stay on top of deadlines.

Our services include preparing and submitting corporation tax returns, monitoring deadlines, and providing ongoing support to ensure compliance with HMRC regulations.

Whether this is your first corporation tax return or you are looking to optimise your existing process, Turbin and Turbin delivers the expertise and practical support needed to simplify corporation tax management. Our goal is to make the filing, submission, and payment process straightforward, allowing you to focus on growing your business. 

In preparing this article every effort has been made to ensure the content is up to date and accurate, however it is no substitute for professional advice. You should not make any decisions based solely on the information presented in this article.