In addition, the small companies' rate is reduced from 20% to 19% for companies with taxable profits between £50,000 and £300,000.
Between these two thresholds, marginal tax relief will apply, easing the transition from the starting rate to the small companies' rate for companies with profits between £10,000 and £50,000.
To calculate the marginal relief available, the Inland Revenue has created the fraction 19/400. Marginal relief also applies to companies with profits of between £300,000 and £1,500,000. The fraction used in the calculation of this marginal relief will be 11/400.
The profits limits may be reduced for a company which is part of a group or has associated companies.