5 April deadline approaching for key tax relief claims
With the end of the 2025/26 tax year now less than seven weeks away, business owners and company directors should remember that several valuable reliefs and elections must be made before 5 April. Which opportunities are about to close?
As 5 April approaches, attention typically turns to income extraction planning, capital allowances and the use of annual exemptions. For owner-managed companies, this includes reviewing the mix of salary and dividends, ensuring sufficient distributable reserves exist for planned dividends, and checking that any directors’ loan accounts are not inadvertently overdrawn.
For individuals and unincorporated businesses, the year end is a final opportunity to make pension contributions that secure tax relief for 2025/26, utilise the annual investment allowance where capital expenditure is planned, and crystallise capital gains to use the annual exempt amount before it is lost.
Employers should also review benefit planning before the year closes. Decisions on trivial benefits, bonus timing and benefit provision can affect both income tax and NI outcomes.
While some claims can be made after the year end, others depend on actions taken before 5 April. With reporting obligations under Making Tax Digital expanding from April 2026 for larger sole traders and landlords, this year end may be the last under the traditional self-assessment system for many businesses.
Related Topics
-
Directors to face identity checks under Companies House reforms
Companies House has published further guidance on the introduction of mandatory identity verification for company directors and other individuals involved in company filings. The change forms part of the reforms introduced by the Economic Crime and Corporate Transparency Act 2023. What do you need to know?
-
Review how much VAT charged on sales?
A recent Tribunal case ruled that HMRC’s logic was flawed in dealing with a “what is the supply” challenge. Does this mean you should check that you are charging VAT correctly on your sales if there could be doubt about what you are selling?
-
Are buy-to-let companies worth the hype?
There’s no doubt that landlords have been on the receiving end of multiple tax hikes in recent years. So called “property experts” will tell you that the best tax-saving strategy is to operate through a company. Are they right?