Caveat
This article explains how marginal relief for UK coporation tax was calculated. From tax year commencing 1st. April 2015. For corporation tax rates and marginal relief that will apply to taxable profits from £50,000 to £250,000 click here.
For marginal relief from 2023 goto: https://www.figurewizard.com/marginal-relief-company-tax-concession-2023.html.
The Marginal Relief Fraction
Taxable profits greater than £300,000 up to a maximum of £1.5 million qualified for additional corporation tax relief. This was marginal relief, based on a fraction that is applied to the taxable profit.
To Illustrate this the following example calculates the marginal relief of a business with a financial year running from 1st. April 2012 to 31st. March 2013 and a taxable profit of £350,000. The fraction for that year is 4/400.
| Upper limit for marginal relief | £1,500,000 |
| less: Taxable profit | £350,000 |
| C/Fwd | £1,150,000 |
| Divide C/Fwd by 400 | £2,875 |
| And multiply by 4 - Thereby returning the value of marginal relief | £11,500 |
| Corporation tax (£350,000 x 24%) | £84,000 |
| Tax payable after deduction of marginal relief | £72,500 |
Abolition of Marginal Relief
From 1st. April 2015 a unified corporation tax rate of 20% will apply for all taxable profits, bringing marginal relief to an end.
Historical Rates of Marginal Relief from 1973
| Year | Threshold Greater Than | Threshold Maximum | Divide by | Multiply by | Standard Rate of Corporation Tax |
| 1973 | 25,000 | 40,000 | 300 | 50 | 52% |
| 1974 | 25,000 | 40,000 | 300 | 50 | 52% |
| 1975 | 40,000 | 60,000 | 400 | 60 | 52% |
| 1976 | 50,000 | 65,000 | 400 | 64 | 52% |
| 1977 | 60,000 | 85,000 | 350 | 50 | 52% |
| 1978 | 70,000 | 100,000 | 400 | 60 | 52% |
| 1979 | 80,000 | 130,000 | 400 | 56 | 52% |
| 1980 | 90,000 | 200,000 | 400 | 32 | 52% |
| 1981 | 100,000 | 225,000 | 400 | 32 | 52% |
| 1982 | 100,000 | 500,000 | 400 | 14 | 52% |
| 1983 | 100,000 | 500,000 | 400 | 20 | 50% |
| 1984 | 100,000 | 500,000 | 400 | 15 | 45% |
| 1985 | 100,000 | 500,000 | 400 | 10 | 40% |
| 1986 | 100,000 | 500,000 | 400 | 6 | 35% |
| 1987 | 100,000 | 500,000 | 400 | 8 | 35% |
| 1988 | 100,000 | 500,000 | 400 | 10 | 35% |
| 1989 | 150,000 | 750,000 | 400 | 10 | 35% |
| 1990 | 200,000 | 1,000,000 | 400 | 9 | 34% |
| 1991 | 250,000 | 1,250,000 | 400 | 8 | 33% |
| 1992 | 250,000 | 1,250,000 | 400 | 8 | 33% |
| 1993 | 250,000 | 1,500,000 | 400 | 8 | 33% |
| 1994 | 300,000 | 1,500,000 | 400 | 8 | 33% |
| 1995 | 300,000 | 1,500,000 | 400 | 8 | 33% |
| 1996 | 300,000 | 1,500,000 | 400 | 9 | 33% |
| 1997 | 300,000 | 1,500,000 | 400 | 10 | 31% |
| 1998 | 300,000 | 1,500,000 | 400 | 10 | 31% |
| 1999 | 300,000 | 1,500,000 | 400 | 10 | 30% |
| 2000 | 300,000 | 1,500,000 | 400 | 10 | 30% |
| 2001 | 300,000 | 1,500,000 | 400 | 10 | 30% |
| 2002 | 300,000 | 1,500,000 | 400 | 19 | 30% |
| 2003 | 300,000 | 1,500,000 | 400 | 19 | 30% |
| 2004 | 300,000 | 1,500,000 | 400 | 19 | 30% |
| 2005 | 300,000 | 1,500,000 | 400 | 19 | 30% |
| 2006 | 300,000 | 1,500,000 | 400 | 11 | 30% |
| 2007 | 300,000 | 1,500,000 | 400 | 10 | 30% |
| 2008 | 300,000 | 1,500,000 | 400 | 7 | 28% |
| 2009 | 300,000 | 1,500,000 | 400 | 7 | 28% |
| 2010 | 300,000 | 1,500,000 | 400 | 7 | 28% |
| 2011 | 300,000 | 1,500,000 | 400 | 6 | 26% |
| 2012 | 300,000 | 1,500,000 | 400 | 4 | 24% |
| 2013 | 300,000 | 1,500,000 | 400 | 3 | 23% |
| 2014 | 300,000 | 1,500,000 | 400 | 1 | 21% |
Figurewizard and Marginal Relief
Our system automatically calculates and applies corporation tax to all of our profit, liquidity and cash flow forecasts. You can view working examples of all of these forecasts by clicking on "sample forecasts" on the menu bar above this article.