What Business Owners Should Review Before 5 April 2026

The end of the tax year often arrives faster than expected.  

For many business owners, March and early April are already full. Client work, team management, payroll, deadlines, and day-to-day decisions tend to take priority, which means year-end planning can easily slip down the list. But with the current UK tax year ending on 5 April 2026, this is a useful time to step back and review the areas that may need attention before the window closes.   

That does not mean everything needs to become urgent.  

In many cases, the most valuable step is simply taking a clearer look at what has happened this year, what still needs action, and whether there are decisions better made before year-end than after it. A short review now can help reduce pressure later and put you in a stronger position for the new tax year.  

Here are some of the main areas worth reviewing before 5 April 2026.  

1. Review how you are taking money out of the business.  

If you run a limited company, this is a sensible point to review how you have taken income from the business during the year.  

This may include salary, dividends, pension contributions, or a mix of these. The right approach depends on your wider income, profits, cash position, and future plans, so it should never be treated as a fixed formula.  

The key point here is not to make rushed decisions, but to make sure your current approach still makes sense before the tax year ends. Year-end is often the best time to sense-check whether anything needs to be reviewed while there is still time to act.  

In view of the additional 2% tax rate being applied to dividends from 6 April 2026, you should also consider whether to pay an additional dividend before 5 April 2026.  Careful planning is needed to ensure that the additional dividend does not move you from say a basic rate taxpayer to a higher rate taxpayer.  

There must be sufficient retained profits to pay the additional dividend although, if there is not sufficient cash available to physically pay the dividend it can be credited to a director’s loan account to be paid when funds allow. 

2. Check whether planned business purchases need better timing.  

If your business has been planning to invest in equipment, tools, machinery, or other qualifying assets, it may be worth reviewing the timing.  

HMRC says businesses can claim capital allowances on qualifying plant and machinery, and Annual Investment Allowance can generally be claimed on qualifying expenditure up to £1 million, allowing the full value to be deducted from profits before tax.   

That does not mean buying something purely for tax reasons. A purchase should still make commercial sense.  

But where spending is already planned and needed, it is worth considering whether the timing works in your favour and how it fits into the bigger financial picture.  

3. Make sure your bookkeeping and records are up to date.  

Year-end planning is only as useful as the numbers behind it.  

If bookkeeping is behind, expenses have not been reviewed properly, or records are scattered across systems and folders; it becomes much harder to make confident decisions. It can also lead to missed claims, duplicated entries, or a rushed clean-up later when accuracy matters most.  

This is a good point to review whether:  

• all income has been recorded correctly   
• expenses have been categorised consistently   
• director transactions or loan accounts need checking   
• receipts and supporting records are complete   
• anything unusual this year needs a closer look   

Sometimes the most effective year-end action is not complicated tax planning. It is simply making sure the information you are working from is complete, accurate, and usable.  

4. Review payroll and employer changes from April.  

If you employ staff, April brings changes that are worth checking now rather than later.  

From 1 April 2026, the National Living Wage and National Minimum Wage rates increase. The rate for workers aged 21 and over rises to £12.71 per hour. The 18 to 20 rate rises to £10.85, while both the 16 to 17 rate and the apprentice rate rise to £8.00.   

HMRC has also published employer rates and thresholds for the 2026 to 2027 tax year. The primary threshold remains £12,570 per year, and the secondary threshold is £5,000 per year.   

For employers, this is a good time to check that:  

• payroll software is ready for the new tax year   
• pay increases have been accounted for   
• directors’ payroll arrangements have been reviewed where relevant   
• year-end payroll processes are on track   

These may seem like practical details, but getting ahead of them helps reduce disruption and makes the new tax year easier to manage.  

5. Look at cash flow, not just tax.  

It is easy for year-end planning to become too tax-focused.  

Tax matters, of course, but a decision that looks efficient on paper can still create strain if it does not fit your cash position. This is why a useful review should look at the wider picture too.  

This includes:  

• what cash is actually available in the business   
• what liabilities are coming up   
• whether drawings remain sustainable   
• whether planned spending fits current working capital   
• whether the business is entering the new tax year with enough financial room  
   

 Good planning is not just about reducing taxes. It is about making decisions that support the health of the business as a whole.  

6. Decide what genuinely needs action before 5 April  

Not everything has to be dealt with immediately.  

Most business owners will benefit from identifying the small number of things that need attention before 5 April, rather than assuming they can all wait. This may mean reviewing how income has been taken, checking records, looking at payroll readiness, or deciding whether a planned purchase should happen now or later.  

A short conversation at the right time can make that much clearer.  

Final thought  

The end of the tax year is not just an administrative deadline. It is a useful checkpoint.  

It gives business owners a chance to step back, review the year more clearly, and make a few informed decisions before the new one begins. Often, the value is not in doing more. It: it is in making sure the right things are reviewed while there is still time to act.  

At Naylor Accountancy Services, we help business owners look beyond year-end compliance, which enables them to make practical financial decisions with greater clarity. If you would like a second pair of eyes on what to review before 5 April 2026, please get in touch with our team.  

+44(0)1892 807 001
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