Accounting Periods for Corporation Tax: Everything UK Companies Need to Know

Your company’s accounting period is the foundation of its corporate tax obligations. It determines which tax rates apply, when payment is due, and when your CT600 must be filed. If you are looking for a broader overview of how Corporation Tax works before getting into the specifics of accounting periods, start with our complete guide to understanding Corporation Tax. Yet many directors are unclear on how their accounting period is set, what happens if it doesn’t align with the calendar year, or how a short period affects their tax rate thresholds. This guide from CIGMA Accounting explains accounting periods for Corporation Tax from first principles covering the rules, the exceptions, and the practical implications for your business.

What Is a Corporation Tax Accounting Period?

A Corporation Tax accounting period is the time span for which your company prepares its accounts and calculates its Corporation Tax liability. It is distinct from, but usually aligned with, your company’s financial year also called the trading year or accounting reference period at Companies House. Key Rule An accounting period for Corporation Tax purposes cannot exceed 12 months. If your company’s financial year is longer than 12 months, it must be split into two separate accounting periods for Corporation Tax.

How Is the Accounting Period Set?

When you form a company, Companies House sets an Accounting Reference Date (ARD) the last day of your annual accounting period. By default, this is the last day of the month in which your company was incorporated, set one year later. Example: A company incorporated on 15 September 2024 would have a default ARD of 30 September 2025. You can change your ARD, subject to Companies House rules. Your accounting period for Corporation Tax usually starts on the day the company starts trading or incorporates if earlier and ends on the ARD. Once you have confirmed the length of your accounting period and the applicable thresholds, the next step is arriving at the correct taxable profit figure for that period. Our step-by-step guide on calculating taxable income for companies walks through exactly how accounting profit is adjusted for Corporation Tax purposes.

The First Year: Short Accounting Periods

In a company’s first year of trading, the accounting period is often shorter than 12 months from the date of incorporation or trading start to the first ARD. This short period has two important tax implications:

• The Corporation Tax rate thresholds (£50,000 and £250,000) are reduced proportionally
• Payment and filing deadlines are calculated from the end of this shorter period

Example: A company starts trading on 1 October 2024 and has a 30 June 2025 year-end a 9-month accounting period. The small profits rate threshold reduces to £37,500 (£50,000 × 9/12) and the upper limit to £187,500 (£250,000 × 9/12).

Long Periods: When Your Financial Year Exceeds 12 Months

If your company prepares accounts covering more than 12 months common when changing your ARD, the period must be split into:

• First 12 months treated as one Corporation Tax accounting period
• The remainder treated as a second, shorter accounting period

Each period has its own Corporation Tax computation, its own rate assessment, and its own filing and payment deadlines. This rate assessment matters particularly if your profits sit in the marginal relief band. Because thresholds are applied to each sub-period separately, a long period split into two can produce a different effective rate than a single 12-month period would. Read our full guide on the marginal rate of Corporation Tax to understand how this affects your liability.

Dormant Companies: Do They Have Accounting Periods?

Yes. Even if a company is dormant not trading, it still has a Companies House accounting reference period and may have a Corporation Tax accounting period. Dormant companies must still file annual accounts with Companies House dormant accounts rather than full accounts and a Confirmation Statement. They should also notify HMRC of their dormant status.

How Your Accounting Period Affects Your Tax Deadlines

Both key Corporation Tax deadlines are tied to the end of your accounting period: Deadline Summary Corporation Tax Payment: 9 months and 1 day after the end of the accounting period CT600 Filing: 12 months after the end of the accounting period Note: These are different deadlines. The payment deadline always falls before the filing deadline. For the officially published Corporation Tax rates and allowances that apply within each accounting period, refer to the HMRC rates and allowances for Corporation Tax on GOV.UK.

How to Find Your Accounting Period

You can confirm your company’s accounting period by:

• Checking your company’s annual accounts the period covered is stated on the first page
• Visiting Companies House and viewing your company’s filing history
• Contacting your accountant they will have this on file
• Checking your HMRC online account your CT accounting period is shown in your Corporation Tax record

Can You Change Your Accounting Period?

Yes, subject to rules. You can change your ARD at Companies House, which will alter your accounting period. However, you cannot shorten an accounting period to less than one month, and you can generally only extend it once in a five-year period with exceptions. Any change should be considered carefully for its tax implications.

Ensure Your Corporation Tax Periods Are Correctly Defined

At Cigma Accounting, we help businesses across London understand how corporation tax accounting periods work so they can meet filing and payment obligations accurately. From Fulham Broadway, including Sands End and Imperial Wharf, many companies are unsure how accounting periods align with financial years and tax returns, which is why our guidance focuses on making these rules clear and manageable in practice.

Getting your accounting periods right is essential for avoiding missed deadlines, incorrect filings, and potential HMRC penalties. With physical offices across London, we support businesses in structuring their reporting correctly, ensuring all submissions are aligned with HMRC requirements and completed on time.