The main rate of corporation tax for companies with profits in excess of £1,500,000 will be reduced from 30% to 28% with effect from 1 April 2008.

The corporation tax small companies’ rate, available for companies with profits below £300,000, will be increased from 20% to 21% with effect from 1 April 2008.

The marginal relief fraction used to reduce the tax charge for companies with profits between £300,000 and £1,500,000 will change from 1/40 to 7/400 with effect from 1 April 2008.