If you run a limited company, your next Self Assessment tax return is going to look a bit different. HMRC has added new questions for company directors. The good news is it doesn’t change how much tax you pay. The slightly less good news is it means a few more boxes to fill in. And be warned missing them out comes with a £60 penalty per omission. This penalty can stack up quickly if you’ve got several directorships and miss out all of them.
New information HMRC want
From the 2025/26 tax year, which you’ll be filing by 31 January 2027, if you’re a director of a “close company” you now need to tell HMRC:
- The name of the company
- Its Companies House registration number
- The amount of dividends you received from it
- Your percentage shareholding during the year (If your shareholding changed during the year, we will need to put down the highest percentage you held at any point).
You need to tick all the boxes now
You also have to confirm, with a tick, whether you were a director of any companies for that year, and whether any of those were close companies. Broadly speaking, a closed company is any UK limited company controlled by five or fewer shareholders, or by its directors. The vast majority of contractor and freelancer companies fall into that category. If it’s just you, or you and your partner, running your own Ltd Co, that’s a close company.
Those tick boxes existed before but answering them was optional. Now it’s mandatory.
If you’re a director of more than one company, you’ll need to do this for each one separately on its own employment page (the SA102). Three directorships means three sets of these boxes. And even if you didn’t take any dividends, or you’re a salaried director with no shares, you still have to fill in the boxes with a zero. Leaving them blank counts as failing to provide the required information, which is where that £60 penalty kicks in.
Why the change, and what it means for your tax bill
Until now, your tax return showed your total dividend income across all sources lumped together. HMRC couldn’t tell whether £37,700 of dividends came from your own company, a FTSE 100 holding, or a mix. From 25/26 onwards, they can see exactly which dividends came from where, and how much of the company you own. The official line is “improved transparency”, and it sits alongside the wider Making Tax Digital rollout for sole traders and landlords that’s just kicked in.
The headline here is that this is purely a reporting change. None of this changes how much tax you pay. Dividend tax rates for 25/26 are unchanged, and the dividend allowance is still £500. You’ll pay the same tax, you’ll just have more boxes on your self-assessment return to fill in.
One other thing worth flagging on the subject of 25/26 returns. If you started or closed a sole trade or partnership during the year, you’ll need to put the exact start or cessation date on your return. It was always requested, but now it’s mandatory too.
What this means for you
If you’re a Maslins client, you don’t need to do anything right now. We already know your company name, your registration number, and your dividend history. When we come to prepare your 25/26 return, we’ll just need you to confirm the information we have and flag anything that’s changed.
The one thing worth telling us about, if you haven’t already, is any directorship somewhere we don’t act for. Maybe you sit on the board of a family member’s company, or a friend’s side project, or setup a company in the background to secure a name. If that’s you, give us a heads-up so we can include it properly on your return. The personal tax questionnaire, which should be with your shortly, will contain boxes to put this information in, and of course we’re here to answer any questions.
The bottom line
None of this changes what you owe, it just means a slightly longer return and a bit more detail. We’ll do the heavy lifting, guide you through it, and be in touch when it’s time to prepare your 25/26 return. But please make sure you tell us about any other companies you’re involved in beyond any companies we act for.
Got a question about any of this, or want to chat through how it applies to your particular setup? Get in touch and we’ll happily talk you through it.
