If you’re wondering how to pay corporation tax in the UK, you’re not alone. Payments look deceptively simple until you’re sitting in front of HMRC’s portal wondering which bank account to use, what on earth a 17-character reference actually means, and whether a Bacs transfer started today will clear before tomorrow’s deadline. At eAccounts, limited company directors regularly ask us these exact questions. And the answers genuinely matter: get the sequencing wrong and you’re not just late, you’re accruing interest at 7.75% per annum from the day after the deadline.
This guide covers how to pay corporation tax in the UK correctly: calculating your liability, locating your payment reference, choosing the right method for your timeline, and confirming HMRC has actually received the funds. Follow these steps once and the whole process becomes routine.
What to have ready before you pay
Your corporation tax liability figure
Before anything else, you need to know how much you owe. The figure comes from your CT600 company tax return, which calculates taxable profits after allowable deductions and applies the relevant rate. As of 2026, the main rate is 25% for profits above £250,000, with marginal relief applying between £50,000 and £250,000, and the 19% small profits rate below £50,000 (see our guide to UK corporation tax rates). For full HMRC thresholds, see GOV.UK’s corporation tax rates guidance for the current thresholds. A common cause of underpayment is miscalculation of taxable profits, which can leave directors facing an unexpected interest bill when HMRC reconciles the return.
Your 17-character payment reference
The 17-character reference is the unique identifier HMRC uses to match your payment to the correct accounting period. Without it, your payment lands at HMRC unallocated and the tax debt remains outstanding in their system. This reference changes for every accounting period, so using last year’s reference will cause a misallocation error: your payment either ends up attributed to the wrong period or sits unmatched entirely. Section 3 below walks you through exactly where to find the current one.
When does the payment actually need to reach HMRC?
The 9 months and 1 day rule
For most UK limited companies, corporation tax must be paid 9 months and 1 day after the end of the accounting period. If your accounting period ends on 31 March 2026, the payment deadline is 1 January 2027. That is the payment deadline, not the filing deadline. The CT600 must be filed within 12 months of the accounting period end, which gives you until 31 March 2027 in that example. Confusing these two dates is one of the most expensive mistakes directors make, because the payment deadline falls three months earlier than the filing deadline.
Large companies: quarterly instalments
Companies with profits above £1.5 million fall into the quarterly instalment payment regime, which means the standard 9-month rule does not apply to them. Instalment dates for large companies fall during and shortly after the accounting period itself, sometimes before the year has even ended. If your profits are approaching that threshold, or if you have associated companies that reduce the effective limit, check whether instalments apply to you. Missing instalment dates carries the same interest consequences as missing the standard deadline; refer to HMRC’s guidance on paying corporation tax in instalments for full details.
How to find your corporation tax payment reference
Finding it in your HMRC online account
Sign in to your HMRC business tax account and select Corporation Tax. From there, choose “View Corporation Tax statement” or “View account,” then open “Accounting periods” and select the relevant period. The 17-character reference for that period is displayed there. The reference follows a consistent structure: your 10-digit UTR, then the letter A, then 001, then a 2-digit accounting period counter, then the letter A. Breaking it down character by character: 10-digit UTR (for example 1234567890), followed by A, then 001, then the period counter (01), then A, giving you 1234567890A00101A. Copy it directly from the screen rather than trying to reconstruct it from memory.
Finding it on HMRC correspondence
The same reference appears on your notice to deliver your tax return and on any HMRC reminders or statements sent to your registered office address. Keep these letters rather than discarding them, because they contain precisely the information you need at payment time. If correspondence is going to an address you no longer use, update your registered office details with Companies House and HMRC to make sure nothing is missed. And to repeat the point: always use the reference for the accounting period you are currently paying, not a previous one.
How to pay corporation tax in the UK: payment methods explained
Faster Payments, CHAPS and online bank approval
Paying through your online banking using Faster Payments, or approving a payment through your bank’s app, is the fastest option. HMRC typically receives Faster Payments the same day or by the next working day. CHAPS is also same working day, provided you send it before your bank’s cut-off time. When paying close to the deadline, these are your most reliable choices because of their speed. Use HMRC’s bank details for corporation tax: sort code 08 32 10, account number 12001039, account name HMRC Cumbernauld (or HMRC Shipley, account number 12001020, same sort code, if your notice specifies Shipley). Always enter the 17-character reference in the payment reference field of your bank transfer.
Corporation tax Direct Debit
You can set up a corporation tax Direct Debit through the Corporation Tax section of your HMRC online account using your 17-character reference. The first time you set up a Direct Debit with HMRC, allow 5 working days for it to process. After that initial mandate, subsequent payments take 3 working days. Set it up at least 5 working days before your deadline to be safe. Direct Debit works well for directors who want a reliable, recurring process, but it is not a last-minute option.
Paying corporation tax by Bacs or card
Bacs transfers take 3 working days to clear, so initiate these well ahead of the deadline. Debit card and corporate credit card payments are accepted and are typically processed the same day or the next working day. For any bank transfer method, whether Bacs, CHAPS, or Faster Payments, use the sort code and account number above and include your 17-character reference. The date HMRC receives the funds is what counts, not the date you initiate the transfer.
Common mistakes that result in penalties and interest
Using the wrong payment reference or account details
A payment sent with an incorrect reference number can end up unallocated in HMRC’s system. HMRC will not automatically recognise it as your corporation tax payment, and late payment interest starts accruing regardless. Rectifying an unallocated payment requires contacting HMRC with your UTR, the payment amount, the payment date, your bank transaction reference, and the correct accounting period. That process takes time, and the interest clock keeps running throughout. Getting the reference right the first time is far simpler.
Misjudging processing times
Initiating a Bacs payment the day before the deadline is one of the most reliable ways to pay late. Three working days means three full working days: weekends and bank holidays do not count. The same applies to first-time Direct Debit mandates, which need 5 working days. As of 9 January 2026, HMRC’s late payment interest rate for Corporation Tax Self Assessment stands at 7.75% per annum, charged daily from the day after the deadline. On a £20,000 tax bill, even a two-week delay generates a notable interest charge, at 7.75% per annum that equates to roughly £59 in interest for a fortnight. Factor processing times into your deadline date, not your payment date.
Taking corporation tax off your plate as a director
The real cost of managing this yourself
For many limited company directors, the challenge is not understanding the process, it is remembering to do everything in the right order, at the right time, while also running a business. The corporation tax timeline spans months: accounts need preparing, the CT600 filed, the liability calculated, and the payment must land at HMRC before the 9-month deadline. By the time the payment appears on your to-do list, the processing window has already shrunk. One missed step and you are paying interest that was entirely avoidable.
How a dedicated accountant handles it for you
A dedicated accountant calculates your corporation tax liability, prepares and files your CT600, tracks your payment deadline, and contacts you with the exact reference number and amount you need to pay, so your only job is to approve the transfer. This is how eAccounts manages the process for UK limited company directors. With a named accountant assigned to your company, the entire corporation tax cycle is managed without you navigating HMRC portals or tracking deadlines across accounting periods.
If you want that kind of support, book a free consultation with eAccounts to see how it works for your business.
How to pay corporation tax in the UK: your five-step checklist
Corporation tax payments follow a clear sequence once you understand it. Work through these five steps every accounting period:
- Calculate your liability from the CT600, ensuring taxable profits and allowable deductions are accurate.
- Locate the correct 17-character reference for that accounting period in your HMRC online account or on your notice to deliver. Never use a reference from a previous period.
- Identify your payment deadline: 9 months and 1 day after period end for most companies. If your profits exceed £1.5 million, check whether quarterly instalments apply instead.
- Choose a payment method that will clear in time given the processing days required. Faster Payments or CHAPS for near-deadline situations; Bacs or Direct Debit only when you have sufficient lead time.
- Confirm receipt by checking your HMRC online account to verify the payment has been deducted from your corporation tax balance.
Need help with Corporation Tax?
eAccounts prepares limited company accounts, CT600 filings and Corporation Tax payments for UK directors. You get a dedicated accountant (not a ticket queue), Xero-ready books, and clear deadlines before HMRC interest starts.
Frequently asked questions
How do I pay corporation tax in the UK?
Log in to your HMRC business tax account to find your 17-character payment reference, then make a bank transfer to HMRC’s corporation tax account (sort code 08 32 10, account number 12001039) using Faster Payments, CHAPS, Bacs, or Direct Debit. You can also pay by debit or corporate credit card through your HMRC online account. Always use the reference for the current accounting period.
When is corporation tax due in the UK?
For most limited companies, corporation tax must reach HMRC 9 months and 1 day after the end of the accounting period. Companies with profits above £1.5 million pay in quarterly instalments on different dates. Note that the payment deadline is separate from, and three months earlier than, the CT600 filing deadline of 12 months after period end.
What happens if I pay corporation tax late?
HMRC charges interest at 7.75% per annum (from 9 January 2026), accruing daily from the day after the deadline. There is no separate fixed penalty for a first late payment, but the interest compounds and continues until the full amount is received. An unallocated payment, caused by a wrong reference, can have the same practical effect.
What reference do I use when paying corporation tax?
Use your 17-character corporation tax payment reference, which consists of your 10-digit UTR followed by A, then 001, then a 2-digit accounting period counter, then A. Find it in your HMRC business tax account under Corporation Tax, or on any HMRC notice to deliver. This reference changes every accounting period, so never reuse one from a previous year.
Understanding how to pay corporation tax in the UK is straightforward once you have the sequencing and processing times clear. The risk is not complexity but complacency, assuming it will sort itself out with a day to spare. Directors who find this process consistently eating into time they do not have are better served having a professional manage it. See how eAccounts handles corporation tax for UK limited companies, from the calculation through to the confirmation.
Lewis shares practical guidance for UK businesses on accounting, tax and digital compliance.
