Corporation Tax Payment Dates: Planning and Compliance for 2025

Corporation tax payment dates represent a critical cash flow consideration for finance directors in 2025, with payment obligations varying based on company size, profitability, and accounting period end dates. Understanding payment deadlines, instalment requirements, and planning opportunities is essential for effective cash flow management and compliance.

Payment Deadlines

Corporation tax is generally due nine months and one day after the end of the accounting period, though large companies may be required to pay by quarterly instalments. Finance directors must ensure payment dates are accurately calculated and that sufficient funds are available to meet obligations.

Late payment can result in interest charges and penalties, making accurate payment date calculation and cash flow planning essential. Finance directors should establish processes to track payment dates and ensure timely payment.

Quarterly Instalment Payments

Large companies with annual profits exceeding £1.5 million are required to pay corporation tax by quarterly instalments, beginning in the seventh month of the accounting period. Finance directors must calculate instalment amounts accurately and ensure payments are made on time.

Cash Flow Planning

Effective cash flow planning requires accurate forecasting of corporation tax liabilities and payment dates. Finance directors should integrate tax payment planning into their cash flow forecasts and ensure adequate liquidity is maintained to meet obligations.

Conclusion

Corporation tax payment planning in 2025 requires accurate calculation of payment dates, understanding of instalment requirements, and effective cash flow management. Finance directors who invest in robust payment planning processes will ensure compliance while optimising cash flow.