The 2025/26 financial year will bring new reporting requirements for UK resident directors of close companies, who file a Self-Assessment Tax Return.
HM Revenue and Customs (HMRC) has introduced measures that will mean company directors will need to provide more information when submitting their annual return.
What will change for close company directors?
Any director completing a Self-Assessment Tax Return will be familiar with the form SA102, which currently asks optional questions about being a company director and whether the organisation is a close company.
Note: A close company is one controlled by five or fewer individual participators, such as shareholders or directors.
From April 2026, when you submit your tax returns for 2025/26, it will be a mandatory requirements to confirm if you are a company director and if you run a close company.
You will also need to clarify the name and registered number of your close company, the value of dividends received from the close company, and the percentage of shareholding in the company during 2025/26.
Where shareholdings have varied during the year, the highest percentage held must be reported.
Are there any financial penalties for non-compliance?
The new requirements fall outside of the current penalty framework but, as a result, a new £60 penalty has been introduced. This will be applied to each failure found in your tax return.
The new penalty is needed because the information a taxpayer is being asked to provide will not impact their Income Tax or Capital Gains Tax liabilities.
Preparing for the changes
For close company directors and owners, the new changes may be challenging; particularly when gathering information around shareholding.
Our expert team can provide comprehensive, tailored advise and support to ensure you can confidently and compliantly submit your tax return.
If you have concerns about the changes, or you need support with your Self-Assessment obligations, contact our team today.
