Two important updates to tax reporting and recovery are taking effect this April.
From the 2026/27 tax year, starting 6th April 2026, two significant changes come into force that could affect company directors, higher earners, and those receiving Winter Fuel Payment.
New reporting rules for company directors:
Directors of a close companies; a UK limited company controlled by five or fewer shareholders, will see a significant difference in their Self-Assessment tax return for 2025/26 (due by 31 January 2027.
What is changing?
Under rules introduced via the Income Tax (Additional Information in Returns) Regulations 2025, directors who hold shares in their own close company are now required to provide additional information on their Self Assessment return.
Specifically, they will need to disclose:
- Their company’s Companies House registration number
- Their highest percentage shareholding during the tax year
- The total amount of dividends they received from the company
IMPORTANT: These disclosures are mandatory even if you owe no dividend tax; for example, if your dividends fall within the annual allowance or your personal allowance absorbs any liability.
Failure to include the required information carries a fixed penalty of £60.
The changes are estimated to affect around 900,000 owner-managed business directors across the UK. HMRC’s aim is to build a clearer, more consistent picture of dividend flows from owner-managed businesses, making it easier to spot discrepancies and target non-compliance.
Recovery of the 2025 Winter Fuel Payment:
In 2025, the government restricted eligibility for Winter Fuel Payments to those receiving Pension Credit or certain other means-tested benefits. However, payments were still made to some individuals who, once their full annual income is taken into account, will have earned above the new threshold. HMRC is now recovering those payments.
If an individual’s total income for the 2025/26 tax year is £35,000 or less, they keep the Winter Fuel Payment. If it exceeds £35,000, HMRC will reclaim it.
IMPORTANT: Income is assessed per person, not per couple or household. If one partner earns above £35,000 and the other earns below it, only the higher earner’s payment will be reclaimed.
How will HMRC reclaim the payment?
The method of recovery depends on how an individual normally deals with HMRC:
- PAYE only (employed or pension income): HMRC will adjust the tax code for 2026/27 automatically. For a typical £200 payment, this equates to roughly £17 per month. No action is required by the individual.
- Self Assessment filer: The payment will appear on the 2025/26 Self-Assessment return as a ‘Winter Fuel Payment charge’. Online filers should check it has been pre-populated; paper filers must include it themselves.
Opting out of future payments
If an individual expects their income to remain above £35,000 in future years, they can opt out of receiving the Winter Fuel Payment altogether, rather than having HMRC reclaim it each time.
How Ormerod Rutter can support you:
These changes may seem modest in isolation, but they reflect a broader shift towards more granular data collection and automated compliance by HMRC.
The best defence is preparation: know what information needs to be provided, understand how any recovery will be applied, and if in doubt, speak to a tax adviser before the deadlines arrive.
The tax team at Ormerod Rutter can help you to understand your individual reporting requirements and ensure that you provide all the necessary information to HMRC. Contact the team today on 01905 777600 or email hello@ormerodrutter.co.uk.
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