What do the boxes ask?
Box 326 wants a simple count: how many companies were associated with yours during the accounting period, not including your company itself. If the answer is none, you enter zero, you do not leave it blank.
Another company counts as associated if one company controls the other, or the same person or people control both. So if you own your trading company and also own a second company, those two are associated. A company counts even if it was only associated for part of the year, but a company that did nothing at all while it was associated with yours, no trade, no business, is ignored. Our associated companies guide walks through the idea properly.
Boxes 327 and 328 are for a period that needs a different count for each of HMRC's financial years, for example one that ran across 1 April 2023, when the £50,000 and £250,000 limits began. For a period ending in 2026, one count covers the whole period. The limits have not changed since April 2023, and the law counts a company that was associated for any part of the period for the whole of it. So you use box 326, even if your year spans two financial years, and leave boxes 327 and 328 empty. HMRC's rules let you fill in one or the other, never both.
There is also a small partner box: if your company pays the small profits rate or claims marginal relief, you put an X in box 329.
Why does the number matter?
Because the £50,000 and £250,000 profit limits are shared out, not given to each company in full. The limits are divided by the number of associated companies plus one, which is your own company. One associated company halves them to £25,000 and £125,000. Three associated companies divide them by four, down to £12,500 and £62,500. A short accounting period shrinks them too.
Here is what that does in practice. Say your company made £40,000 of profit. Standing alone, that is under £50,000, so the whole lot is taxed at 19% and the bill is £7,600. Now say you also control one other company. The limits halve, £40,000 is above the new £25,000 lower limit, so your company no longer gets the 19% rate on everything. Instead the tax is worked out at 25% and marginal relief brings the bill part of the way back down, so you end up somewhere between 19% and 25%. Same profit, bigger bill, all because of the number in box 326, which in this example is 1. Our guides to marginal relief and boxes 380 to 395 show where the maths lands on the form.
What usually goes wrong?
The classic slip is counting your own company. Box 326 asks for the others only. The sharing-out maths does include your company, but the form does that part for you, so a director with one trading company and one other company writes 1, not 2.
The second slip is writing nothing when the answer is none. If you are claiming the 19% rate or marginal relief, the box needs a zero, and box 329 needs its X.
The third is forgetting a company that only existed for part of the year, or assuming a sleeping company never counts. Part of the year is enough to count. Only a company that did nothing at all while it was associated with yours is ignored.
One honest limit: who exactly controls what can get genuinely tricky, especially with family shareholdings or several companies. If you own or part-own more than one active company, this is a sensible thing to check with an accountant before you file.
Does the software fill these boxes for me?
Yes. SimpleReturns asks the question in plain English while you answer a few short questions about your company, then shrinks the limits, picks the right rate, works out any marginal relief, and fills the associated-companies part of the return for you. You see every figure before anything is sent. It is free to start, no card needed, and filing costs £99 with Guided flat for both filings, the tax return to HMRC and the accounts to Companies House.