A useful point to review your business

For many businesses, summer provides a useful opportunity to pause and take stock before the pressures of the autumn trading period and the approach of the tax year end begin to dominate attention again.

The first half of 2026 has brought continuing financial pressures for many owner-managed businesses. Rising employment costs, ongoing inflation concerns, cash flow pressures and economic uncertainty have all combined to create a more demanding business environment. Against this backdrop, a mid-year business health check can be an extremely valuable exercise.

Reviewing cash flow

One of the first areas to review is cash flow. Even profitable businesses can experience financial strain if customer payments are slowing down or costs are rising more quickly than expected. Reviewing debtor levels, payment terms and future tax liabilities can help identify potential pressure points before they become more serious problems.

Businesses should also consider whether existing overdraft or funding arrangements remain suitable, particularly if borrowing costs have increased over recent months.

Are your profit margins still healthy?

This is also a good time to review profitability. Many businesses have experienced rising wage, supplier and financing costs over the past year, but some have been reluctant to adjust their pricing. A careful review of margins may reveal that certain products, services or customers are no longer delivering the returns they once did.

Small pricing adjustments or improved cost controls can sometimes make a significant difference to overall profitability.

Reviewing systems and tax planning

Business owners should also consider whether their bookkeeping and management information systems are providing accurate and timely information. With Making Tax Digital now applying to increasing numbers of self-employed individuals and landlords, maintaining reliable digital records is becoming more important than ever.

Tax planning should form part of any summer review. Waiting until the end of the tax year can reduce the number of planning opportunities available. Reviewing remuneration strategies, pension contributions, capital expenditure plans and future profit expectations at an earlier stage can often create greater flexibility.

Looking ahead

For family businesses, summer can also provide an opportunity to review longer-term plans. Succession arrangements, shareholder structures and inheritance tax exposure are areas that are often postponed until problems arise, but early planning usually creates more options and better outcomes.

Finally, many business owners benefit from stepping back and reviewing wider business risks. Cyber security, insurance cover, staff retention, customer concentration and borrowing arrangements are all areas that deserve periodic attention.

A summer health check does not need to be complicated, but it can provide valuable reassurance and help identify opportunities for improvement before the busy final quarter of the year begins.

If you would like help reviewing your business finances, cash flow, tax position or future plans, please contact us. A timely review today could help avoid more significant problems later in the year.

Businesses are being urged to remain alert after Companies House and the Intellectual Property Office (IPO) issued a joint warning about unsolicited payment requests and misleading invoices being sent to UK companies.

According to the government announcement, some businesses are receiving letters and emails that appear official and request payment for services connected with Companies House filings or intellectual property registrations. In many cases, the organisations sending these requests are not connected with government and may be charging inflated fees for services that are either available directly from official sources at a much lower cost or free of charge altogether.

Newly incorporated businesses and companies filing intellectual property applications can be particularly vulnerable because their details are publicly available and may be targeted by third parties seeking to imitate official correspondence.

The warning highlights that some requests are designed to look convincing, using official sounding names, formal layouts and references to statutory obligations or deadlines. Business owners may therefore assume that payment is mandatory when, in reality, the request relates to an optional third-party service.

Companies House and the IPO are advising businesses to carefully check all payment requests before making payment and to verify whether correspondence genuinely originates from an official government source.

Warning signs can include:

� requests for unusually high fees,

� payment demands shortly after incorporation or trademark applications,

� vague descriptions of services,

� unofficial bank details,

� pressure to pay quickly,

� and correspondence from organisations with names similar to government bodies.

Businesses should also remember that official Companies House fees and IPO fees can normally be verified directly through GOV.UK websites.

The warning serves as a timely reminder that fraud attempts against UK businesses continue to evolve, particularly where publicly available company information can be used to create apparently credible requests for payment.

Business owners may wish to ensure that staff responsible for accounts payable or company administration understand the risk of misleading invoices and know how to verify requests before payment is authorised.

Simple internal controls, such as confirming new suppliers independently, checking website domains carefully and reviewing unusual invoices with advisers before payment, may help reduce exposure to this type of scam.

For many years, employees and directors using their own cars for business journeys have relied on HMRC's approved mileage allowance rates as a simple way to recover motoring costs. However, despite the recent increase in the approved rate from 45p to 55p per mile from 6 April 2026, many motorists may still find themselves substantially out of pocket once inflation and rising running costs are taken into account.

The original 45p per mile rate was introduced in April 2011 and remained unchanged for fifteen years. During that period the UK experienced significant inflation, particularly in the years following the pandemic, when fuel prices, insurance premiums, servicing costs and vehicle finance charges all rose sharply.

When inflation is taken into account, the original 45p rate introduced in 2011 would need to be worth approximately 65p to 67p per mile by March 2026 to provide the same real level of reimbursement. This means that, even after the increase to 55p per mile, the approved allowance still falls noticeably below the inflation adjusted equivalent.

For business owners and employees who regularly travel for work, the financial impact can become considerable. A driver covering 10,000 business miles per year under the old 45p system would have received £4,500. Had the rate increased in line with inflation since 2011, the equivalent reimbursement could have been closer to £6,600.

The issue is not simply one of fuel prices. Modern motoring costs now include increasingly expensive insurance, higher repair and servicing charges, tyre replacement costs, financing expenses and depreciation. Electric vehicles may reduce fuel expenditure, but they can still involve substantial purchase and repair costs.

Many professional bodies and business groups have argued for some time that the approved mileage allowance rates no longer reflected the true cost of business motoring, particularly for smaller businesses where directors and staff regularly use private vehicles for work related travel.

The recent increase to 55p per mile is therefore a welcome step, but many motorists may feel it does not fully address the cumulative effect of fifteen years of inflation.

Businesses should also remember that mileage claims need to be properly recorded and supported by accurate business mileage logs. Poor record keeping can lead to HMRC challenges and potentially denied claims.

If you would like advice on mileage claims, staff reimbursement policies, company car alternatives or the wider tax implications of business travel, please contact us.

1 June 2026 - Due date for corporation tax due for the year ended 31 August 2025.

19 June 2026 - PAYE and NIC deductions due for month ended 5 June 2026. (If you pay your tax electronically the due date is 22 June 2026).

19 June 2026 - Filing deadline for the CIS300 monthly return for the month ended 5 June 2026. 

19 June 2026 - CIS tax deducted for the month ended 5 June 2026 is payable by today.

1 July 2026 - Due date for corporation tax due for the year ended 30 September 2025.

6 July 2026 - Complete and submit forms P11D return of benefits and expenses and P11D(b) return of Class 1A NICs.

19 July 2026 - Pay Class 1A NICs (by the 22 July 2026 if paid electronically).

19 July 2026 - PAYE and NIC deductions due for month ended 5 July 2026. (If you pay your tax electronically the due date is 22 July 2026).

19 July 2026 - Filing deadline for the CIS300 monthly return for the month ended 5 July 2026. 

19 July 2026 - CIS tax deducted for the month ended 5 July 2026 is payable by today.

The Chancellor of the Exchequer, Rachel Reeves updated Parliament on 21 May 2026 on the Government's economic response to the war in Iran and the wider measures being taken to support households and businesses with rising cost pressures. One of the measures announced was an increase in approved mileage rates for those using their own vehicles for work.

The approved mileage rates for cars and vans will increase from 45p per mile to 55p per mile. This increase has been backdated to the start of the tax year, 6 April 2026. This rate applies only to the first 10,000 business miles in each tax year, with the approved mileage rate remaining at 25p per mile for any additional mileage over the threshold. The change is intended to support employees and the self-employed who rely on travel for work. It has been confirmed that all other mileage rates remain unchanged for the time being although this may be reviewed again at the next Budget.

If an employer reimburses mileage at less than the approved rates, the employee may claim the shortfall through Mileage Allowance Relief (MAR). This ensures tax relief is given on the difference. For example, if an employer reimburses 35p per mile, tax relief may be claimed on the remaining 20p per mile for qualifying business journeys (excluding ordinary commuting). If no mileage allowance is paid then tax relief can usually be claimed on the full 55p per mile rate (up to 10,000 business miles). 

The approved mileage rates for motorcycle journeys remain at 24p per mile and for bicycle journeys at 20p per mile. Where employees carry colleagues on business journeys, employers may also pay an additional 5p per passenger per mile. There are no overriding distance limits for these payments.

Identity verification requirements at Companies House became a legal requirement for directors and people with significant control (PSCs) from 18 November 2025. This date marked the start of a 12-month transition period for identity verification. 

Companies House is introducing the new requirements on a phased basis and affected individuals are being contacted directly with guidance on what action is required and the relevant deadlines. It is estimated that between 6 and 7 million individuals will need to complete identity verification by November 2026.

Verification is generally a one-time process and can be completed either directly through Companies House using GOV.UK One Login or through an Authorised Corporate Service Provider (ACSP), such as an accountant or solicitor.

Most individuals will be able to verify their identity online using photo identification documents such as a passport, UK driving licence or biometric residence permit. Alternative methods are also available, including in-person verification at selected Post Office branches or by using information linked to a UK bank account and National Insurance number.

Individuals who are unable to use the standard online or in-person routes may appoint an ACSP to verify their identity on their behalf. The provider must be registered with Companies House and supervised for anti-money laundering purposes.

Failure to comply with the new requirements could result in restrictions on company filings and penalties.

Making gifts during your lifetime can be an effective way to reduce the value of your estate for Inheritance Tax (IHT) purposes.

One of the most commonly used exemptions is the annual exemption. This allows an individual to give away up to £3,000 each tax year without the gift forming part of their estate for IHT purposes. If the exemption is not used in full, any unused amount can be carried forward to the following tax year, although only for one year. This means that someone who made no qualifying gifts in 2025-26 could potentially give away up to £6,000 in 2026-27 free of IHT. 

There is also a useful exemption for small gifts. You can give as many gifts of up to £250 per person each tax year as you wish, provided no other exemption has been used for the same individual. This is known as the small gift allowance. 

Special rules apply to wedding and civil partnership gifts. Parents can give up to £5,000 to a child tax-free, grandparents and great-grandparents can give up to £2,500, and anyone else can give up to £1,000. In many cases these exemptions can be combined with the annual exemption. 

Another valuable relief covers gifts made out of surplus income. There is no fixed monetary limit, but the gifts must form part of normal expenditure, be made out of income rather than capital, and leave the donor with enough income to maintain their usual standard of living. This exemption can be very useful for individuals with excess pension or investment income who wish to help children or grandchildren on a regular basis. Keeping clear records is important, as HMRC may ask for evidence that the conditions have been met. 

Gifts between spouses or civil partners are generally exempt from IHT, provided both parties are permanently domiciled in the UK. Gifts to charities are also normally exempt.

Dividends are taxed differently from other types of income, with separate allowances and tax rates that depend on your overall level of income. You do not pay tax on dividends that fall within your Personal Allowance (2026-27: £12,570), and there is also a separate tax-free dividend allowance of £500 each year. Any dividend income above these allowances is taxable.

The rate of tax you pay on dividends depends on your Income Tax band. 

For the 2026-27 tax year, the rates are:

• Basic rate: 10.75%
• Higher rate: 35.75%
• Additional rate: 39.35% 

To determine which rate applies, your dividend income is added to your other income. This means dividends can push you into a higher tax band and / or can be taxed across more than one rate.

If you receive up to £10,000 in dividends you can ask HMRC to change your tax code and the tax due will be taken from your wages or pension, or you can enter the dividends on your self-assessment tax return, if you already fill one in. You do not need to notify HMRC if the dividends you receive are within your dividend allowance for the tax year.

If you have received over £10,000 in dividends, you will need to complete a self-assessment tax return. If you do not usually send a tax return, you need to register by 5 October following the tax year in which you received the relevant dividend income.

The government has announced a package of measures intended to protect motorists and businesses from the recent rise in fuel costs, following growing concern over the impact higher oil prices may have on inflation, household finances and business operating costs.

The measures include an extension of the existing 5 pence per litre fuel duty reduction, which had previously been due to end later this year. The government has also confirmed additional support aimed at the transport and logistics sector, including temporary vehicle tax relief for some haulage businesses.

Fuel costs remain one of the most significant operating expenses for many businesses, particularly those involved in transport, delivery services, construction, engineering, agriculture and mobile service industries. Even relatively small increases in fuel prices can quickly affect profitability, especially where businesses operate vehicle fleets or rely heavily on road transport.

Recent geopolitical tensions and higher global oil prices have added further uncertainty to business planning during 2026. In response, the government has stated that it wants to reduce the immediate financial pressure on both consumers and businesses while helping to limit wider inflationary effects across the economy.

While the extension of the fuel duty reduction may provide some short term relief, many businesses may still need to review their wider cost structures and cash flow arrangements carefully over the coming months.

Businesses affected by rising transport and fuel costs may wish to consider:

• Reviewing pricing structures and margins
• Monitoring vehicle and fuel efficiency
• Reviewing business mileage and logistics arrangements
• Improving cash flow forecasting
• Assessing the tax efficiency of company vehicle arrangements
• Reviewing the potential use of electric or hybrid vehicles

For some businesses, fuel costs can gradually erode profitability if not monitored carefully. Regular management information and forward planning may help identify issues earlier and support better decision making.

If rising operating costs are affecting your business, please contact us to discuss how we may be able to help you review profitability, improve cash flow planning and assess tax efficient options for your business operations.

Many taxpayers continue to leave their Self-Assessment tax return until the final weeks before the 31 January filing deadline. Unfortunately, delaying preparation often increases stress levels, creates unnecessary pressure and reduces the opportunity to plan effectively.

Preparing your tax return earlier in the tax year can provide a number of practical and financial advantages.

Know your tax position sooner

One of the main benefits of preparing your Self-Assessment tax return early is that you gain a clearer understanding of your tax position well in advance of the payment deadline.

This allows more time to budget for any tax liabilities and helps avoid the shock of discovering a large balancing payment shortly before 31 January. Early preparation can be particularly valuable for self-employed individuals, landlords, company directors and taxpayers with multiple income sources.

Knowing your tax liability earlier may also help with wider financial planning decisions, including pension contributions, capital expenditure, savings arrangements or future tax planning opportunities.

Reduce the risk of missing information

Leaving tax returns until the final weeks often increases the risk of overlooking important information or struggling to locate documents at short notice.

Preparing returns earlier gives taxpayers more time to identify missing records, obtain replacement statements and resolve queries before the filing deadline approaches.

This may be especially important where income has been received from investments, property, overseas sources or digital platforms.

Avoid the January rush

January is traditionally the busiest period of the year for accountants and tax advisers. By providing information earlier, clients can often benefit from a more measured review process and greater opportunity to discuss tax planning points or areas of concern.

Early preparation may also reduce the risk of filing delays caused by unexpected technical issues, missing records or HMRC processing problems.

Identify planning opportunities earlier

Preparing your return well before the deadline may help identify opportunities to improve tax efficiency for the current or future tax years.

In some cases, early discussions may highlight opportunities relating to pension planning, capital allowances, profit extraction, loss relief claims or business structure reviews.

Please send your information early

We would encourage all clients to begin gathering their tax return information as soon as possible and to forward records to us sooner rather than later.

Early submission helps us prepare returns in a more efficient and timely manner and gives you more opportunity to understand your tax position and plan ahead with confidence.

If you would like assistance preparing your Self-Assessment tax return, please contact us and send your records to us at your earliest convenience.