The key dates

• 5 October 2026: tell HMRC if you need to file a return for the first time.
• 31 October 2026: deadline for paper returns.
• 31 January 2027: online return, balancing payment for 2025/26 and first payment on account for 2026/27.
• 31 July 2027: second payment on account for 2026/27.

What to gather now

• Your Unique Taxpayer Reference (UTR) and Government Gateway login.
• P60, P45 or P11D if you were employed or received benefits.
• Self-employed income and expenses, ideally from your bookkeeping software.
• Rental income and costs, including mortgage interest statements.
• Bank and building society interest, dividends and any gains from selling shares or property.
• Pension contributions and Gift Aid donations, which can reduce your bill.

Payments on account, explained

If your last bill was over £1,000 and less than 80% of your tax was collected at source, HMRC asks for two advance payments towards next year, each half of this year’s bill. The first year this happens can feel like paying 150% at once. If your income has dropped, you can ask to reduce them — but only if you are confident, because interest applies if you reduce too far.

What happens if you miss it

A late return means an immediate £100 penalty, even if no tax is owed. After three months, daily penalties of £10 start, and further penalties follow at six and twelve months. Late payment adds interest and its own penalties.

How we help

We prepare and check your return, explain the numbers before anything is filed and tell you exactly what to pay and when. File early and you will know your January bill in November, with time to plan for it.

This article is general guidance based on the rules for the 2026/27 tax year. It isn’t personal advice — talk to us before you act on it.

Costs you can usually claim

• Office costs: stationery, printer ink, postage and software subscriptions.
• Phone and internet: the business share of your bills.
• Travel: fuel, parking, train fares and hotels for business trips — but not your regular commute.
• Stock and materials you buy to sell or use in your work.
• Professional fees: accountants, solicitors and trade body memberships.
• Insurance: public liability and professional indemnity.
• Marketing: your website, advertising and business cards.
• Training that updates skills you already use in the business.

Simplified expenses

Instead of working out actual costs, you can use flat rates for some items:

• Vehicles: 45p per business mile for the first 10,000 miles, then 25p.
• Working from home: £10 a month for 25 to 50 hours, £18 for 51 to 100 hours and £26 for more than 100 hours.

Common mistakes

• Claiming everyday clothing. Only uniforms and protective clothing count.
• Forgetting small, regular costs such as bank charges and app subscriptions.
• Mixing personal and business spending in one account, which makes the business share hard to prove.

Keep the evidence

Keep receipts and invoices for every claim. A photo in your bookkeeping app is enough, and it saves hours at year end.

How we help

We review your costs, make sure nothing allowable is missed, and flag anything HMRC is likely to question — before your return is filed.

This article is general guidance based on the rules for the 2026/27 tax year. It isn’t personal advice — talk to us before you act on it.

The 2026/27 numbers that matter

• Personal Allowance: £12,570, frozen until April 2031.
• Employer National Insurance: 15% on salary above £5,000 a year.
• Employee National Insurance: 8% on earnings above £12,570.
• Dividend Allowance: £500.
• Dividend tax: 10.75% basic rate, 35.75% higher rate and 39.35% additional rate.

Why a small salary helps

A salary is a business expense, so it reduces Corporation Tax, and it can count towards your State Pension record. Many directors set salary around the National Insurance thresholds. The best level depends on whether your company can claim Employment Allowance — a company where the director is the only employee usually can’t.

How dividends work

Dividends are paid from profits after Corporation Tax. You can only pay them if the company has enough retained profit, and each one should be backed by board minutes and a dividend voucher. They aren’t subject to National Insurance, which is where the saving usually comes from.

Things to plan for

• Personal tax on dividends is paid through Self Assessment, often months later. Put money aside as you go.
• The higher dividend rates from April 2026 mean last year’s plan may no longer be the best one.
• Pension contributions paid by the company can be an efficient alternative for money you don’t need now.

How we help

We work out your salary and dividend mix at the start of each tax year, run the director’s payroll, prepare the dividend paperwork and tell you how much to save for your tax bill.

This article is general guidance based on the rules for the 2026/27 tax year. It isn’t personal advice — talk to us before you act on it.

Making Tax Digital applies to rental income

MTD for Income Tax covers landlords as well as sole traders. It started on 6 April 2026 for people with qualifying income over £50,000 and extends to over £30,000 from April 2027 and over £20,000 from April 2028. Qualifying income is gross rent plus any self-employment income — before expenses. If you own property jointly, you count your share.

Once you’re in, you keep digital records, send quarterly updates and file a final declaration after the year end.

New property income tax rates from April 2027

From April 2027, property income will be taxed at its own rates: 22% basic, 42% higher and 47% additional — two percentage points above the standard Income Tax rates. For many landlords, that means a higher bill on the same rent.

Steps worth taking now

• Check your qualifying income and whether you are already inside MTD.
• Separate rental money from personal money with a dedicated bank account.
• Review how property is owned. Ownership between spouses, or through a company, changes who pays tax and at what rate — but moving property can trigger Capital Gains Tax and Stamp Duty Land Tax, so get advice first.
• Keep a full record of finance costs, repairs and letting fees; none of it helps if you can’t prove it.
• If your rental income is small, the £1,000 property allowance may be simpler than claiming expenses.

How we help

We look after landlords’ records, quarterly updates and returns, and model the effect of the 2027 rate changes on your portfolio so you can plan rather than react.

This article is general guidance based on the rules for the 2026/27 tax year. It isn’t personal advice — talk to us before you act on it.