1. Understanding the UK Tax Year
The UK tax year runs from 6 April to 5 April of the following year. This is the basis for income tax calculations for individuals, sole traders, and partnerships. For small businesses, especially limited companies, tax responsibilities also depend on their accounting period, which can differ from the standard tax year.
2. Self-Assessment Income Tax (Sole Traders and Partnerships)
Sole traders and partners in partnerships must file a Self Assessment tax return each year. The key deadlines are:
- 5 October – Deadline to register for Self Assessment after starting your business.
- 31 January – Deadline to submit the online Self Assessment return for the previous tax year and pay the tax due.
- 31 July – Deadline to pay the second “payment on account” if applicable.
Failure to submit or pay on time leads to automatic penalties and interest charges.
3. Corporation Tax (Limited Companies)
Limited companies must pay corporation tax on their profits. Deadlines vary depending on the company’s accounting period.
- Tax Payment – Due 9 months and 1 day after the end of your accounting period.
- Filing Deadline – Corporation Tax return (CT600) must be filed within 12 months after the end of the accounting period.
For example, if your company’s year-end is 31 March 2025:
- Tax payment is due by 1 January 2026.
- Tax return is due by 31 March 2026.
4. VAT Deadlines
If your business is VAT-registered, you’ll need to submit VAT returns and pay VAT every quarter, unless you’re on an annual scheme.
- Returns and payments are generally due 1 month and 7 days after the end of each VAT period.
- Example: VAT period ends 31 March → deadline is 7 May.
Making Tax Digital for VAT requires you to keep digital records and file VAT returns using compatible software.
5. PAYE and National Insurance (Employers)
If you employ staff, you must operate a Pay As You Earn (PAYE) scheme. Key payment deadlines include:
- Monthly PAYE payments – Due by the 22nd of each month (or 19th if paying by post).
- Quarterly PAYE payments – If you pay less than £1,500/month, you can pay quarterly, by the 22nd after each quarter.
Late submissions or payments may result in interest and penalties.
6. Other Business Taxes to Note
- Business Rates – Charged on most non-domestic properties and paid annually or monthly.
- Apprenticeship Levy – Applies if your annual pay bill exceeds £3 million.
- Construction Industry Scheme (CIS) – Contractors must submit monthly returns by the 19th of each month.
7. Penalties for Missing Tax Deadlines
Missing tax deadlines can trigger:
- Automatic penalties (e.g., £100 for a late Self Assessment)
- Daily fines after a certain delay
- Interest on unpaid amounts
- Investigation or audit risk increases
Always plan ahead and use automated reminders or accounting software.
8. Staying Compliant and Organized
To keep on top of your tax obligations:
- Use digital accounting software (many now integrate with HMRC).
- Set calendar reminders for all relevant deadlines.
- Reconcile your accounts monthly to avoid year-end surprises.
- Hire a tax advisor if unsure about your obligations.
Frequently Asked Questions
When is the UK tax deadline for small businesses?
Self Assessment tax is due by 31 January following the end of the tax year. Corporation tax is due 9 months and 1 day after a company’s accounting period ends.
Do small businesses pay tax every month in the UK?
Not always. PAYE may be monthly if you employ staff. VAT and income/corporation tax are usually paid quarterly or annually.
What happens if I miss a tax deadline in the UK?
Penalties range from £100 fixed fines to daily penalties and interest. Consistent lateness can trigger audits.
Do I pay VAT if I’m a small business?
Only if your taxable turnover exceeds the VAT threshold (currently £90,000 as of 2025) or you voluntarily register for VAT.
How do I know which tax applies to my business?
Sole traders usually pay income tax via Self Assessment. Limited companies pay corporation tax. VAT and PAYE depend on your revenue and employment.
Can HMRC extend deadlines?
Only in exceptional cases, such as system failures or natural disasters. Otherwise, deadlines are strict.
Conclusion
Knowing when small businesses pay taxes in the UK helps you avoid penalties, maintain cash flow, and stay on the right side of HMRC. Mark key dates, choose the right accounting method, and stay compliant through digital solutions or professional help. Whether you’re a sole trader or a limited company, staying ahead of these tax deadlines is a crucial part of running your business successfully.