A solvent business has sufficient resources to pay suppliers, employees, lenders and the tax authorities on time. Maintaining this position helps to build trust with stakeholders. Suppliers may be more willing to offer favourable credit terms, lenders may be more comfortable providing finance, and customers are more likely to have confidence in a business that appears financially stable.

Solvency is also important from a legal and governance perspective. Company directors have a duty to ensure that their business does not continue trading if it is unable to meet its obligations. If a company trades while insolvent, directors could face serious consequences, including potential personal liability for certain debts.

Regular financial monitoring plays an important role in protecting solvency. Reviewing management accounts, balance sheets and cash flow forecasts allows business owners to identify potential problems early. This may provide time to reduce costs, improve collections from customers, refinance borrowings or introduce additional capital.

Maintaining adequate reserves and controlling debt levels are also key elements of a strong solvency position. Businesses that rely too heavily on borrowing can become vulnerable if trading conditions deteriorate or interest rates rise.

For these reasons, solvency should be seen as a core measure of business health. Regular financial review and forward planning can help ensure that a business remains stable, resilient and able to meet its commitments.

For most owners the business represents their largest financial asset. Without proper planning it can be difficult to realise its full value when the time comes to sell or transfer ownership. Potential buyers will expect to see reliable financial information, stable cash flow and well organised systems that allow the business to operate effectively without relying entirely on the owner.

Planning ahead also creates opportunities to manage the tax position more efficiently. The structure and timing of a sale, together with the availability of reliefs, can significantly affect the final amount of tax payable. Early planning allows these issues to be reviewed and structured properly.

Succession is another key consideration. Where a business is to be transferred to family members or senior employees, a gradual transition can help ensure the new leadership is fully prepared and that the business continues to operate smoothly.

An exit strategy also helps owners think about their own future plans and financial security. For these reasons, business exit planning should be treated as an important part of long term business strategy rather than a last minute decision.

Please call if you would like to consider your options.

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

19 April 2026 – Filing deadline for the CIS300 monthly return for the month ended 5 April 2026.

19 April 2026 – CIS tax deducted for the month ended 5 April 2026 is payable by today.

30 April 2026 – 2024-25 tax returns filed after this date will be subject to an additional £10 per day late filing penalty for a maximum of 90 days.

1 May 2026 – Due date for corporation tax due for the year ended 30 July 2025.

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

19 May 2026 – Filing deadline for the CIS300 monthly return for the month ended 5 May 2026.

19 May 2026 – CIS tax deducted for the month ended 5 May 2026 is payable by today.

31 May 2026 – Ensure all employees have been given their P60s for the 2025/26 tax year.

Tax relief on private pension contributions is generally available on contributions of up to 100% of relevant earnings, subject to certain limits. The relief effectively reduces the cost of saving into a pension. Basic rate taxpayers benefit from 20% tax relief, while higher rate taxpayers can claim 40% relief and additional rate taxpayers can receive 45% relief on their contributions.

For basic rate taxpayers, the initial 20% relief is usually applied automatically by the pension provider. Higher and additional rate taxpayers can claim the extra relief through their self-assessment or by contacting HMRC if they do not normally file a return.

Most individuals can contribute up to the annual allowance of £60,000 each tax year while still benefiting from tax relief. Contributions above this limit can trigger an annual allowance charge. However, it may be possible to contribute more by using the carry forward rules, which allow unused pension allowances from the previous three tax years to be used, provided they made pension contributions during those years.

The first cohort subject to MTD for IT from 6 April 2026 are those whose qualifying income exceeded £50,000 in the 2024–25 tax year. This figure is important because HMRC is using the income declared on 2024–25 self-assessment tax returns to determine who must join MTD from April 2026. Anyone above this threshold will normally be required to keep digital records and submit information to HMRC using compatible software.

Qualifying income broadly refers to the total gross income from self-employment and rental income before expenses are deducted, also referred to as ‘turnover’. This can include income from multiple sources of self-employment and property income. However, all other types of income are not included when determining whether the threshold is met. For example, employment income taxed through PAYE, pension income, dividends and partnership income do not count towards the MTD income limit.

A second phase of the rollout will follow in April 2027, when MTD for Income Tax will extend to individuals with qualifying income between £30,000 and £50,000.

According to HMRC, the spring months are the busiest period for recruitment. In 2025, more than 1.8 million people began new jobs between April and June.

HMRC is encouraging jobseekers and those starting a new role to download the HMRC app, which provides quick access to essential employment and tax information. The app allows users to view details that employers often request when someone starts a new job, including their National Insurance number, employment and income history, tax code and PAYE records such as a P60.

The app had more than 2.7 million new users in 2025. Among the most frequently used features are the ability to download a PAYE employment history, access a digital National Insurance number and use a tax calculator to estimate how much tax is paid on salary.

HMRC’s Chief Customer Officer, said:

“Applying for a job or starting a new job can be hard work in itself. But the HMRC app provides you with handy access to everything you need to make the admin side of things a little easier – especially important for young people who may not know what information an employer requires. Download the HMRC app to save yourself some time and stress and avoid those first day jitters.”

As a result, the personal allowance will stay at £12,570, while the higher rate threshold will remain at £50,270 for taxpayers across most of the UK (with different thresholds applying in Scotland). National Insurance thresholds will also remain fixed over the same period.

Keeping these thresholds unchanged means that many taxpayers will gradually pay more tax as their earnings increase over time. This effect, commonly known as fiscal drag, occurs when wages rise but tax bands do not. As incomes grow due to inflation or pay increases, a larger portion of earnings becomes taxable, and more people move into higher tax brackets.

In practical terms, the continued freeze is likely to push increasing numbers of taxpayers into the 40% higher rate band and, for some, the 45% additional rate band. Others who previously earned below the personal allowance may also begin paying Income Tax for the first time. Although tax rates themselves remain unchanged, the overall tax burden rises as more income becomes subject to tax.

Fiscal drag is influenced by several factors, including government policy on tax thresholds, inflation levels and wage growth. In periods of rising wages or high inflation, the impact of frozen thresholds becomes more pronounced. For taxpayers the impact of fiscal drag effectively operates as a stealth tax over time.

From April 2026, the tax rates applying to dividend income will increase by 2%. The ordinary dividend rate will rise to 10.75%, while the upper dividend rate will increase to 35.75%. The dividend additional rate and the dividend trust rate will remain unchanged at 39.35% as will the dividend allowance at £500.

Further changes will apply from April 2027. Income Tax rates on both property income and savings income will increase by 2%. For the 2027–28 tax year, property income will be taxed at 22% (basic rate), 42% (higher rate) and 47% (additional rate). Savings income will also be taxed at the same rates.

Alongside these rate changes, the government is also reforming how Income Tax is calculated by altering the current ordering rules that determine the calculation of Income Tax. Under the current system, savings and dividend income are treated as the highest part of an individual’s income. Most other income, such as employment, pension or trading income, is grouped together as “non-savings, non-dividend income” and taxed first.

Under the new rules, the revised order of taxation will be:

1. Income that is not property, savings or dividend income
2. Property income
3. Savings income
4. Dividend income

These changes to the calculation of Income Tax are intended to better reflect the different nature of income sources and ensure the new tax rates for property, savings and dividends operate as intended.

There are penalties for the late submission of company tax returns. The filing penalties will increase for company tax returns where the filing date falls on or after 1 April 2026.

The penalties are designed to encourage companies to file their Corporation Tax returns by the required deadline. Fixed penalties for late filing were originally set in 1998 and have remained unchanged since then. Over time, inflation has significantly reduced the real value of these penalties and therefore their deterrent effect. In real terms, the penalties are now worth roughly half of what they were when first introduced.

The increase in company late filing penalties will see the doubling of fixed penalties. From 1 Apri 2026, a return that is filed late will attract a penalty of £200 instead of the current £100. If the return is more than three months late, the penalty will increase to £400, compared with the current £200. Higher penalties will continue to apply where a company repeatedly files late returns. Where there are three successive failures to file on time, the penalty will increase from £500 to £1,000, and where the return is more than three months late after three consecutive failures, the penalty will rise from £1,000 to £2,000.

Ensuring that company tax returns are submitted on time will help companies avoid unnecessary penalties and additional compliance costs.

In periods of economic uncertainty, including times when input costs such as energy, materials, or finance are rising, faster payback periods become particularly valuable. Projects that recover their costs quickly reduce risk because the business is exposed to changing economic conditions for a shorter period of time. Once the initial investment has been recovered, any continuing savings or additional income effectively becomes a financial gain.

For example, many energy efficiency improvements such as LED lighting, improved heating controls, or better insulation can often pay for themselves within a relatively short period. After the initial costs have been recovered, the continuing reduction in energy bills becomes a direct improvement to profitability.

A faster return on investment can also free up capital for further improvements. Once the first project has repaid its cost, the savings generated can be reinvested into other efficiency measures or growth opportunities.

For business owners, this highlights the importance of prioritising investments that deliver early financial benefits. Quick wins not only improve profitability but also create momentum for further improvements across the business.