Payments on account for companies

Larger companies pay corporation tax quarterly rather than nine months after the year end.

What it means

Companies with profits above a threshold must pay corporation tax in quarterly instalments, with the first falling during the accounting period.

Why it matters

It brings the cash outflow forward substantially, and the first year a company crosses the threshold is a significant cash event nobody budgeted for.

What it looks like in practice

The threshold is divided between associated companies, which brings smaller groups into the regime unexpectedly.\n\nVery large companies pay even earlier.

What to watch out for

Crossing the threshold in a good year and having to pay part of that year's tax during the year, while also paying the previous year's.

Where to get proper advice

Your accountant.