The main rate of corporation tax rises to 25% from 1st April 2023 for profits >£50,000.

Profits >£250,000 will pay the full rate.

Profits <£50,000 will remain at 19%.

Profits between £50-250k will vary on a crazy formula; not linear, it is disproportionate in HMRC's favour.

How it works, profits are charged at 25% then a formula reduces it. A table gives and idea:

• £50,000 = 19.00%
• £60,000 = 20.25%
• £70,000 = 21.14%
• £80,000 = 21.81%
• £90,000 = 22.33%
• £100,000 = 22.75% (quarter way to £250k, but tax is increased 62.5%).
• £125,000 = 23.50%
• £150,000 = 24.00% (half way to £250k, but tax is increased 83%).

Making company pension contributions can now be more valuable.