The 2025/26 financial year will bring new reporting requirements for UK resident directors of close companies, who are required to 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 tax return.
What will change for close company directors?
Any director completing a Self-Assessment tax return will be familiar with the form SA102. This currently asks optional questions about being a company director and whether the organisation is a close company (i.e. 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 requirement 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 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?
Because these new requirements fall outside the current penalty framework, 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 advice and support to ensure you can confidently submit your tax return.
