End of financial year: what businesses should be doing now

With the UK tax year ending on 5 April, now is the time for business owners and finance teams to ensure everything is in order. Whether you operate as a sole trader, limited company, or partnership, the decisions made — or deferred — in the final weeks of the financial year can have a significant impact on your tax position and financial reporting.

Review your profit and loss

Pull your management accounts and compare actual performance against your budget. Identify any large or unusual items that may require adjusting entries. If you are working from provisional figures, this is the time to confirm them.

Maximise allowable deductions

If you have planned capital expenditure, consider whether bringing it forward into the current tax year would be beneficial — particularly where the Annual Investment Allowance (AIA) or full expensing provisions apply. The same consideration applies to pension contributions, qualifying training costs, and professional subscriptions.

Dividends and remuneration planning

For director-shareholders of limited companies, the split between salary and dividends remains one of the most impactful planning decisions available. For the 2025/26 tax year, the dividend allowance is £500, and corporation tax rates of 19% and 25% apply depending on your profit bracket. Your accountant should model the most efficient extraction strategy based on your specific circumstances.

VAT threshold

If your taxable turnover is approaching the VAT registration threshold (£90,000 from April 2024), monitor your rolling 12-month figure carefully. Voluntary registration may be advantageous if the majority of your customers are VAT-registered businesses, as it allows you to reclaim input tax on your purchases.

Payroll and employment obligations

Confirm that all Real Time Information (RTI) submissions to HMRC are current, that final payslips for the year are accurate, and that any benefits in kind have been properly recorded. The deadline for submitting P11D forms is 6 July following the end of the tax year. Employers should also review their compliance with auto-enrolment pension obligations.

Record-keeping

HMRC requires businesses to maintain adequate records for a minimum of six years. Ensure that bank statements, purchase and sales invoices, receipts, contracts, and payroll records are properly organised — whether in digital or physical form. Businesses using Making Tax Digital (MTD) should confirm their digital records meet the functional requirements.

Key deadlines

• 5 April 2026: End of 2025/26 tax year
• 6 April 2026: Start of 2026/27 tax year — new rates and thresholds take effect
• 6 July 2026: Deadline for P11D and P11D(b) submissions
• 31 January 2027: Self Assessment filing and payment deadline for 2025/26

Our CMB Core team supports businesses with financial planning, year-end reviews, and business documentation. If you need assistance preparing for year-end, get in touch and we will work through it with you.