From April 2026, HMRC is increasing the level of detail required in your Self-Assessment tax return if you are a company director or shareholder. This is part of a wider push towards greater transparency and compliance, especially with the rollout of Making Tax Digital (MTD) and tighter data matching.

What’s Changing?

HMRC will begin asking more detailed questions about your involvement with limited companies. This means:

• Declaring whether you are a director or shareholder
• Providing company details (such as name and registration number)
• Reporting Dividends received seperately

This moves away from the simpler reporting many directors are used to.

Why Is HMRC Doing This?

HMRC is aiming to:

• Improve accuracy of tax returns
• Cross-check data with Companies House and other sources
• Identify errors, omissions, or deliberate underreporting
• Strengthen compliance around dividends, director’s loans, and benefits

In short, HMRC wants a clearer picture of how individuals interact with their companies.

What Does This Mean for You?

If you run a limited company, expect:

• More time needed to complete your tax return
• A need for accurate and well-maintained records
• Increased risk of enquiries if figures don’t align

Errors or inconsistencies could trigger compliance checks, so getting it right first time is key.

Key Areas to Watch

HMRC is likely to focus on:

• Dividend income vs company profits
• Director’s Loan Accounts (DLA) and overdrawn balances
• Benefits in kind (e.g. company cars, vans, fuel)

How to Prepare

To stay ahead:

• Keep clear records of all income taken from your company
• Reconcile your dividends with company accounts
• Monitor your Director’s Loan Account regularly
• Work with an accountant to ensure full compliance

Final Thoughts

These changes don’t necessarily mean you’ll pay more tax, but they do mean more scrutiny and less room for error.

If you’re a company director, now is the time to review your processes and make sure everything is properly documented ahead of April 2026.

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📧 Email: Tax@TaxesDoneRight.co.uk
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