by Ariful | Sep 17, 2026 | Australia Updates
TITLE: ATO Prosecutions Up 80%, TPB Sanctions Expand, Trust Tax Consultation Closes: What Australian Businesses Must Do Now
ATO prosecutions rise 80% as non-lodgment attracts criminal consequences
The ATO has reported an 80% increase in successful shadow economy non-lodgment prosecutions over the past two years.
More than 350 individuals and businesses have been successfully prosecuted. The ATO also secured more than 305 convictions, with convictions rising by almost 60% year on year. Courts imposed more than $2.7 million in fines.
The ATO estimates that the shadow economy may represent up to 5.4% of Australia’s GDP. Assistant Commissioner Tony Goding has warned that deliberate non-lodgment can result in:
- Criminal convictions.
- Financial penalties.
- Damage to business reputation.
- Loss of customer and marketplace trust.
- In serious cases, the closure of a business.
The figures are particularly relevant for ecommerce brands, digital agencies, SaaS businesses and fast-growing SMEs. Revenue may flow through Shopify, Amazon, eBay, Stripe, PayPal or other platforms, but the business remains responsible for maintaining complete records and lodging its required returns.
Queensland, Western Australia and New South Wales lead prosecution figures
During 2025–26, the state distribution of successful non-lodgment prosecutions was reported as:
- Queensland: 28%.
- Western Australia: 26%.
- New South Wales: 20%.
- Victoria: 17%.
- South Australia: 7%.
- Northern Territory: 2%.
- Australian Capital Territory: 1%.
This means businesses in Brisbane, Perth and Sydney should take particular care when reviewing overdue lodgments. However, the risk applies nationwide, including businesses operating from Melbourne, Adelaide and Canberra.
Act now: check whether every required tax return, BAS, PAYG report and annual obligation has been lodged. If something is missing, organise the records and address the outstanding obligation promptly. Doing this can reduce the risk of escalating ATO action and prevent a missed filing from becoming a wider compliance problem.
Review your tax agent before stronger TPB sanctions take effect
The Tax Practitioners Board is introducing a broader sanctions toolkit for tax adviser misconduct. The measures include:
- Criminal penalties for certain unregistered entities and unregistered tax return preparers.
- New civil penalties for breaches of the Code of Professional Conduct.
- Higher maximum civil penalties.
- Infringement notices.
- Enforceable undertakings.
- Interim suspension powers.
- Contingent suspension powers.
- Greater transparency around practitioner sanctions.
These changes matter to business owners because your tax agent or BAS agent may handle sensitive financial information, lodgments and communications with the ATO.
Verify registration before sharing business records
Before you appoint or continue working with an accountant, tax agent or BAS agent:
- Search the TPB Register.
- Confirm that the individual or entity is registered for the services they provide.
- Check whether the registration details match the person or business you are dealing with.
- Review engagement terms and responsibility for records, approvals and lodgment deadlines.
- Keep copies of submitted returns and confirmation receipts.
The enhanced sanctions regime applies from 1 October 2026 following passage of the Treasury Laws Amendment (Strengthening Accountability for Tax Adviser Misconduct and Other Measures) Bill 2026, and the TPB has confirmed it will publish further practitioner guidance in the coming months.
Confirm your agent’s registration and engagement terms now.
Trust tax consultation closes on 18 September
Treasury is consulting on exposure draft legislation proposing a 30% minimum tax on certain discretionary trust distributions.
The proposed measure is intended to apply from 1 July 2028. It is not yet law. However, the current consultation on the exposure draft closes tomorrow, 18 September 2026.
If your ecommerce brand, digital business or SME operates through a discretionary trust, review the exposure draft and assess whether the proposed rules may affect:
- Distribution decisions.
- Beneficiary taxation.
- Trust accounting records.
- Group structures.
- Cash-flow planning.
- The timing and documentation of distributions.
If you want to provide feedback, lodge a submission through the Treasury Consultation Hub before the closing time.
Do not treat the proposal as an immediate tax liability. It remains a consultation measure. However, reviewing the exposure draft now gives you time to identify data gaps and understand which trust records may be needed if the legislation proceeds.
The ATO’s overview of the proposal is also available on its page about introducing a minimum tax on discretionary trusts.
Prepare for the 21 September BAS and PAYG deadline
The next immediate compliance date is 21 September 2026.
For businesses with monthly reporting obligations, this date covers:
- The August 2026 monthly BAS.
- Any August 2026 monthly PAYG instalment reported monthly.
- Payment of the amounts shown as payable.
The deadline is especially important for businesses with high transaction volumes. Online stores and digital businesses should reconcile payment gateways, marketplace settlements, refunds, shipping income, platform fees and foreign currency transactions before finalising the BAS.
Do not confuse this date with the quarterly PAYG instalment deadline. Businesses on quarterly PAYG instalments generally have a different due date, and your activity statement or instalment notice will confirm the amount and deadline that applies to you.
Use the ATO’s September 2026 key dates and PAYG instalment guidance to verify your obligations.
Complete this Australia tax compliance checklist today
Use this checklist before the next deadline:
- Confirm that all required income tax returns and BAS lodgments are up to date.
- Reconcile ecommerce marketplaces, payment processors and business bank accounts.
- Check GST treatment for domestic and international sales.
- Review refunds, chargebacks, gift ca
by Ariful | Sep 16, 2026 | Australia Updates
TITLE: R&D Tax Incentive, CGT Concession and Loss Carry-Back Changes: What Australian Companies Should Review Now
Track the R&D draft changes before you plan future claims
Treasury’s exposure draft legislation proposes significant changes to the R&D Tax Incentive from 1 July 2028. The consultation closes on 28 September 2026.
The proposed reforms are designed to direct more support towards additional business R&D, particularly for growing and innovative Australian companies. However, they will also change how you track expenditure and assess eligibility.
Key proposed changes
- The minimum R&D expenditure threshold would increase from $20,000 to $50,000.
- The maximum expenditure eligible for the premium offset rate would increase from $150 million to $200 million.
- The refundable offset would generally be limited to entities within their first 10 years of carrying on an enterprise or their first 10 years of R&D registration.
- Biotech and medtech entities conducting R&D for therapeutic goods could access the refundable offset for up to 15 years.
- The refundable offset turnover threshold would increase to $50 million.
- Core R&D offset rates would increase by up to approximately 50%.
- The intensity premium threshold for the non-refundable offset would fall to 1.5%.
- Eligible entities beyond the 10-year period with aggregated turnover below $50 million could receive the highest available rate as a non-refundable offset.
- Supporting R&D activities would be removed from the incentive.
- Treasury is seeking feedback on whether clinical manufacturing R&D expenditure should remain eligible.
These proposals are not yet final law. Do not change your 2026–27 tax position solely on the basis of the exposure draft. Instead, create a clear comparison between your current R&D records and the proposed rules.
Start your R&D compliance review
- Separate core and supporting activities. This will help you identify expenditure that may no longer qualify.
- Calculate your annual R&D spend. Test whether your activity is likely to meet the proposed $50,000 minimum.
- Review your company age and R&D registration history. This may affect whether a future offset is refundable or non-refundable.
- Confirm aggregated turnover. The proposed $50 million threshold will be important for growing businesses.
- Retain project evidence. Keep technical records, testing results, payroll data, invoices and time records to support the claim.
- Monitor Treasury’s final legislation. The final rules may change after consultation closes.
This preparation will reduce the risk of rebuilding your R&D calculation process at short notice.
Prepare now for the Innovative Business CGT Concession
Treasury has also released exposure draft legislation for the Innovative Business CGT Concession (IBCC). The proposed concession would apply to relevant CGT events occurring on or after 1 July 2027.
The IBCC would provide a 50% CGT discount on gains from eligible early-stage investments in innovative Australian startups. It is intended to support investment in businesses with growth potential, commercial innovation and the ability to scale.
Proposed eligibility requirements
An eligible IBCC company would generally need to:
- Be incorporated for less than 15 years.
- Be based in Australia.
- Not be controlled by a company incorporated 15 or more years ago.
- Not be listed.
- Have aggregated turnover below $50 million.
- Satisfy the innovative company test.
- Satisfy the predominant activity test.
The draft rules would provide a 15-year eligibility window across all qualifying firms. The minimum holding period would fall from five years to three years. The proposed lifetime cap of $10 million would also be removed.
The concession would not apply automatically. An eligible taxpayer would need to choose the IBCC discount instead of cost-base indexation. It would also be unavailable to companies, complying superannuation entities and foreign residents.
Treasury has proposed a draft legislative instrument allowing existing companies to self-assess their innovation status. A separate instrument is planned for companies incorporated on or after 1 July 2027.
Build an investment evidence file
If your company is developing SaaS, digital products, medical technology, biotechnology or another innovative commercial product, start organising:
- Incorporation and ownership records.
- Aggregated turnover calculations.
- Product development and commercialisation documents.
- R&D expenditure records.
- Intellectual property ownership evidence.
- Growth and scaling plans.
- Annual reporting information.
- Details of direct equity investments and acquisition dates.
This evidence will help you test whether the company and investment meet the proposed conditions. It will also make future CGT calculations more reliable.
Do not treat the exposure draft as enacted law. The consultation remains open until 28 September 2026, and the final legislation may contain changes.
Use the new tax loss carry-back rules to review cash flow
Tax loss carry-back has now passed into law as a permanent measure. It applies to income years starting on or after 1 July 2026.
Eligible corporate entities with turnover of up to $1 billion may carry back current-year losses to offset tax paid in the previous two income years. This may create a tax refund for companies that were profitable before experiencing a loss.
For a growing ecommerce brand, software company, agency or other Australian business, the measure could improve cash flow during a period of investment, slower sales or increased operating costs.
Review your loss position
- Compare your projected 2026–27 taxable income with previous years.
- Identify tax paid in the prior two income years.
- Reconcile accounting losses with tax losses.
- Check that your company remains eligible under the detailed rules.
- Maintain evidence for revenue, expenses, asset transactions and group structures.
- Monitor ATO guidance and updated company tax return instructions.
A loss shown in your accounts is not automatically the same as a tax loss. Accurate bookkeeping and a complete tax calculation are essential before you assess a potential carry-back claim.
You should also avoid making a cash-flow decision before confirming the available amount. The benefit depends on the company’s prior tax payments, current tax position and compliance with the legislative conditions.
Update salary packaging before the April 2027 FBT changes
The ATO has announced changes for salary-sacrificed work-related benefits from 1 April 2027, the start of the next FBT year.
by Ariful | Sep 16, 2026 | USA Accounting
TITLE: IRS Form 5471 Schedule E: New CFC Foreign Tax Allocation Rules for the Repealed Section 898(c)(2) Election
IRS Updates Form 5471 Schedule E Reporting for CFCs After Repeal of the Section 898(c)(2) One-Month Deferral Election
The IRS has updated the Form 5471 Schedule E reporting process for controlled foreign corporations affected by the repeal of the section 898(c)(2) one-month deferral election.
The changes matter if your international seller group operates through a US parent and a foreign subsidiary in the UK, EU, Canada, Australia, or another market. You may need to allocate foreign income taxes between the CFC’s first required year and its succeeding taxable year.
This update also affects foreign tax credit tracking, PTEP distributions, election statements, and the supporting records attached to Form 5471.
Act now: the proposed regulation comment deadline is 17 September 2026
The IRS and Treasury published proposed regulations under REG-115145-25 addressing:
- The repeal of the section 898(c)(2) one-month deferral election.
- Allocation of foreign taxes between two taxable years.
- The section 960(d)(4) foreign tax credit disallowance.
- Reporting and election procedures for affected US shareholders.
Comments are due by 17 September 2026. That is tomorrow, based on the publication date of this update.
Comments should be submitted through Regulations.gov, referencing IRS and REG-115145-25.
Understand the first required year before preparing Schedule E
The One Big Beautiful Bill Act repealed the one-month deferral election under section 898(c)(2) for taxable years of specified foreign corporations beginning after 30 November 2025.
An affected CFC must now generally align its taxable year with the required year of its majority US shareholder under section 898(c)(1).
This creates a transition period.
The CFC’s first required year is the first taxable year beginning after 30 November 2025 under the new required-year rules. Its next full accounting period is the succeeding taxable year.
For example:
- A US parent uses a calendar tax year.
- Its foreign CFC previously used a November 30 year-end under the one-month deferral election.
- The CFC’s first required year may run from 1 December 2025 to 31 December 2025.
- The succeeding taxable year then runs from 1 January 2026 to 31 December 2026.
This short first required year can create a mismatch. Foreign tax law may impose tax on a full foreign taxable year, while US tax reporting may recognise only one month of the CFC’s income in the first required year.
That is why foreign tax allocation is now central to Schedule E compliance.
Complete the new Schedule E column (j) reporting
The updated IRS Form 5471 instructions require affected CFCs to report allocated foreign income taxes in Schedule E, Part I, Section 1, column (j).
The amount entered in column (j) should reflect the foreign income tax amount allocated to the CFC’s first required year under the transition rules.
You must not simply report the full foreign tax liability without considering the allocation requirement. Doing so may distort:
- Foreign tax credit calculations.
- Current-year earnings and profits.
- Section 951 and section 951A income groups.
- Taxes deemed paid under section 960.
- PTEP tracking and future distributions.
Maintain a clear reconciliation between the total foreign tax accrued under local law and the amount reported in column (j). This will help you support the filing if the IRS requests additional information.
Attach a detailed foreign tax allocation table
The Form 5471 support should include a statement or table for each foreign income tax subject to allocation.
Your working table should identify at least:
| Required information |
What to record |
| Payor entity |
The foreign corporation, branch, QBU, partnership, or disregarded entity that paid or accrued the tax |
| EIN or reference ID |
The entity’s EIN or consistent Form 5471 reference ID number |
| Total tax accrued |
The total foreign income tax accrued for the relevant foreign tax year |
| Amount allocated to the first required year |
The portion allocated to the short or transitional first required year |
| Amount allocated to the succeeding year |
The remaining portion allocated to the succeeding taxable year |
| Allocation method used |
The standard allocation percentage, income-group-specific method, or another permitted method under the proposed rules |
Label any amount allocated to the succeeding taxable year clearly. Use a notation such as “succeeding year tax” or “relevant succeeding year tax” where appropriate.
The IRS worksheet for Schedule E column (j) requests payor details, identification numbers, total tax, the amount allocated to the first required year, and the allocation method. Your supporting statement should also preserve the succeeding-year amount so that the total reconciles completely.
This recordkeeping will save time when preparing the succeeding-year Schedule E and reviewing foreign tax credit balances.
Apply the correct allocation method
The proposed regulations generally use an allocation percentage based on foreign-law taxable income.
The basic calculation is:
Foreign-law taxable income attributable to the first required year ÷ total foreign-law taxable income for the relevant foreign taxable year
You then apply that percentage to the foreign tax assigned to each relevant income group.
The proposed rules also provide an election to use an income-group-specific allocation method. This may be important where income types are unevenly distributed between the first required year and the succeeding taxable year.
For example, a CFC may earn ordinary tested income during the first required year but recognise a capital gain only in the succeeding year. A single percentage may not accurately reflect the tax associated with each income group.
Keep the following evidence:
- Foreign tax returns.
- Tax computations.
- Trial balances for the short year.
- Income-group calculations.
- Foreign-law taxable income schedules.
- Exchange-rate calculations.
- Reconciliations to Schedule E and Schedule E-1.
Review the controlling domestic shareholder elections
The proposed section 1.898(c)-1 rules allow certain elections to be made by the affected corporation’s controlling domestic shareholders.
Election statements may apply to:
- Specified distributive shares of creditable foreign tax expenditures.
- Income-group-specific allocation.
- Non-allocation of specified foreign income taxes.
- Allocation of relevant succeeding-year taxes.
The election statement must be attached to the relevant Form 5471 and use the applicable title specified in the proposed rules, such as:
- “Section 898 Income Group Specific Election Statement.”
- “Section 898 Non-Allocation Election Statement.”
- “Section 898 Relevant Succeeding Year Tax Election Statement.”
Do not assume that one shareholder’s election applies automatically to every entity in the group. The election must be reviewed for consistency across all affected CFCs and controlling domestic shareholders.
by Ariful | Sep 16, 2026 | UK Updates
TITLE: EU Customs Reform, UK VAT Changes and ViDA: Deadlines Cross-Border Sellers Must Track
Deadlines and changes to track
- 14–15 September 2026: EU customs reform advanced through Parliament, and the Council’s first-reading position was published in the Official Journal as Position (EU) No 10/2026. Final signature and publication of the completed legislation are still pending.
- 1 October 2026: Qualifying domestic electricity supplies in Great Britain move temporarily from 5% VAT to 0%.
- 31 December 2026: Transitional UK VAT group refund claims for VAT incurred between 1 July 2025 and 30 June 2026 must be submitted.
- 1 January 2027: The first ViDA OSS and IOSS changes apply.
- 1 November 2026 at the latest: The EU-wide small-parcel handling fee is scheduled to apply. The amount is not yet fixed.
- 1 July 2028: EU ecommerce operators must begin using the Customs Data Hub under the new timetable.
- October 2028 at the latest: The UK plans to remove the £135 low-value import customs duty relief.
Cross-border compliance is moving quickly. This week brings major EU customs reform progress, a temporary UK electricity VAT cut, new VAT refund procedures, and a shorter runway to the first ViDA changes. Use this edition to identify the deadlines that affect your sales channels, import flows, VAT registrations, and reporting systems.
1. Prepare for the EU Customs Data Hub and platform importer rules
The European Parliament approved the Council’s position on the recast Union Customs Code on 14 September 2026. The Council’s first-reading position was published in the Official Journal on 15 September as Position (EU) No 10/2026.
The reform will repeal Regulation (EU) No 952/2013 and create:
- An EU Customs Data Hub.
- A European Union Customs Authority based in Lille, France.
- A new Trust and Check trader status.
- Updated customs responsibilities for non-EU ecommerce platforms and distance-sale operators.
- A new EU-wide handling fee for small parcels.
Operations for the new customs authority are expected from 2027. However, the final legislative signature and completed publication remain pending. Treat the current position as a confirmed direction of travel, not as the final operational rulebook.
The most important change for online sellers is responsibility. Non-EU ecommerce platforms and distance-sale operators will be treated as importers for relevant transactions. They will be responsible for customs formalities and duty payments.
The Customs Data Hub will become mandatory:
- For ecommerce operators from 1 July 2028.
- For all traders from 1 March 2034.
Trust and Check status will reward traders that share reliable data in real time. Authorised Economic Operator status will remain available.
Read the European Parliament update on the Union Customs Code and the Council’s reform announcement.
Act now if you sell through Amazon, Shopify or another platform
Review your import model before the new systems become mandatory.
Check:
- Who is currently listed as importer of record.
- Who pays customs duty and import VAT.
- Whether your platform collects VAT but leaves customs obligations with you.
- Whether your product, origin, commodity code and value data are complete.
- Whether your fulfilment partner can provide shipment-level customs records.
A UK brand using Amazon FBA in Germany, France or Spain may currently view Amazon as only a sales channel. Under the new framework, the platform or distance-sale operator may carry wider importer responsibilities. Your contracts, data flows and VAT records must reflect the actual transaction structure.
2. Apply the UK electricity VAT cut correctly
The Value Added Tax (Supplies of Domestic Electricity) Order 2026 introduces a temporary 0% VAT rate for qualifying domestic electricity supplies in Great Britain.
The rate applies from 1 October 2026 to 31 March 2027.
Northern Ireland remains at the 5% reduced rate.
Qualifying use includes:
- Domestic use in homes.
- Certain residential settings.
- Supplies within the de minimis rules.
- Non-business use by eligible charities.
The measure affects approximately 100 electricity suppliers. Businesses receiving qualifying supplies will not normally need to change their VAT returns simply because the supplier applies the new rate. However, suppliers must update billing systems, tax codes and invoice processes.
Billing periods that cross 1 October need particular care. HMRC Revenue and Customs Brief 10 (2026) explains that suppliers may determine VAT liability by the date of consumption. Meter readings are recommended.
Protect your billing records
If your business receives qualifying electricity, keep:
- The supplier invoice.
- Meter readings around 1 October.
- Evidence of domestic or qualifying use where relevant.
- Records showing how any business and non-business use was calculated.
Read the HMRC guidance on the temporary zero rate and the updated VAT Notice 701/19 on fuel and power.
3. Submit UK VAT group refund claims through the correct entity
Revenue and Customs Brief 8 (2026), published on 8 September, changes how eligible non-UK businesses in a UK VAT group claim UK VAT refunds.
Each eligible non-UK business that incurred the VAT must submit its own claim. The representative member should not automatically submit the claim on its behalf.
For the transitional period covering VAT incurred between 1 July 2025 and 30 June 2026, claims are due by 31 December 2026.
There is also a route to ask HMRC to reconsider certain claims refused since 1 January 2021. Requests must be made by 31 August 2027.
Review your group records now. Match each invoice to the entity that incurred the VAT. This will reduce rejected claims and prevent cash-flow delays.
4. Get ready for the first ViDA changes
The EU’s VAT in the Digital Age package continues its phased rollout. The first relevant OSS and IOSS changes apply from 1 January 2027.
Commission Implementing Regulation (EU) 2026/1869 sets technical rules for the VAT special schemes. The Commission also published revised OSS Guidelines on 24 July 2026.
The first phase includes:
- OSS expansion for certain B2C supplies of electricity, gas, heating and cooling energy.
- Clarification of the €10,000 threshold.
- Extended deemed-supplier rules, including the “group of four”.
- New identification requirements for VAT groups using OSS or IOSS.
- Confirmation that the SME exemption scheme cannot be used simultaneously with IOSS.
The wider Single VAT Registration reforms follow from 1 July
by Ariful | Sep 15, 2026 | UK Updates
TITLE: October 2026 Compliance Checklist for UK Limited Companies
October 2026 brings several important compliance actions for UK limited companies. Employment tribunal time limits are changing, dividend tax rates apply for the 2026/27 tax year, and several tax deadlines fall during the month.
You should also prepare for Companies House identity verification and the Autumn Budget on 28 October. Use this checklist to organise your records now and avoid rushed filings, missed payments or incomplete documentation.
Start with the October compliance calendar
Add these dates to your finance and payroll calendar:
| Date |
Action |
| 1 October 2026 |
Pay Corporation Tax for the accounting period ended 31 December 2025 |
| 1 October 2026 |
Six-month employment tribunal time limit begins for relevant workplace matters occurring on or after this date |
| 5 October 2026 |
Register for Self Assessment if you have a new obligation for the 2025/26 tax year |
| 22 October 2026 |
Pay PAYE, National Insurance and CIS deductions electronically for the tax month ending 5 October |
| 28 October 2026 |
Autumn Budget 2026 |
| 31 October 2026 |
Submit a paper Self Assessment tax return for 2025/26, if required |
| Around 18 November 2026 |
Expected end of the transition period for existing Companies House directors and PSCs |
Do not leave these actions until the final week. Early preparation gives you time to correct bookkeeping records, confirm payment references and resolve missing information.
Keep stronger HR records as tribunal time limits extend
From 1 October 2026, the standard time limit for most employment tribunal claims increases from three months to six months. The change applies where the relevant workplace issue happens on or after 1 October.
The updated rule covers many common claims, including disputes involving:
- Unfair dismissal
- Discrimination and harassment
- Unauthorised deductions from wages
- Working time
- TUPE
- Breach of contract claims in England and Wales
The existing three-month limit generally continues to apply to issues that happened before 1 October 2026. The position for breach of contract claims in Scotland changes from 9 November 2026. The Acas early conciliation process remains in place.
Read the official employment tribunal time limits guidance and update your internal procedures.
Store records for longer
A longer claim window means you may need to locate evidence several months after an event. Maintain a secure, dated record of:
- Sickness absence and return-to-work discussions
- Payroll changes and deductions
- Disciplinary meetings
- Grievances and investigation notes
- Dismissal decisions and termination letters
- Holiday requests and disputed holiday payments
- Working hours, overtime and rota records
- Emails and written communications relating to workplace issues
Keep the records consistent with your payroll and accounting system. For example, if an employee disputes a deduction, your payroll report, payslip, bank payment and written explanation should tell the same story.
Also review your staff handbook and template letters. Replace references to a three-month tribunal period where appropriate. Clear documentation will help you respond confidently if a former employee raises a concern later.
Record every dividend decision correctly
The dividend rates for the 2026/27 tax year are:
- 10.75% for taxpayers in the basic rate band
- 35.75% for taxpayers in the higher rate band
- 39.35% for taxpayers in the additional rate band
- £500 dividend allowance
The dividend allowance is not a separate tax band. Dividends above the allowance are taxed according to the shareholder’s overall income position. Shareholders may need to report dividend income through Self Assessment.
The official HMRC dividend tax guidance explains how the rates apply from 6 April 2026 to 5 April 2027.
Maintain a complete dividend file
Before declaring a dividend, check that the company has sufficient distributable profits. Then retain:
- Board minutes or a written board resolution
- The dividend declaration date
- The amount paid to each shareholder
- Dividend vouchers
- Evidence of the bank payments
- Updated director loan account records, where relevant
Do not treat a personal withdrawal as a dividend simply because it has been paid from the company bank account. Missing paperwork can make the transaction difficult to support and may create problems in your company accounts or the shareholder’s tax return.
This is also a useful time to review your salary and dividend mix. Consider the company’s cash flow, payroll costs, available profits and the shareholder’s expected personal tax position. Your records should show what was decided and why the payment was made.
Pay the October Corporation Tax deadline
If your company’s accounting period ended on 31 December 2025, Corporation Tax is due on 1 October 2026.
This is the payment deadline. It is separate from the deadline for filing the Company Tax Return. Check that your accounting records are complete before calculating the liability.
Reconcile:
- Shopify, Stripe, PayPal and other payment accounts
- Business bank accounts and credit cards
- Sales invoices and refunds
- Stock purchases and inventory movements
- Payroll and pension costs
- VAT returns and VAT control accounts
- Director loan accounts
- Accrued expenses and prepayments
For context, the current Corporation Tax rules provide a 25% main rate, a 19% small profits rate for qualifying profits of £50,000 or less, and Marginal Relief between the relevant profit thresholds. Read the latest Corporation Tax rates guidance before finalising your calculation.
Pay electronically with enough time for the payment to reach HMRC. A late payment may lead to interest and penalties.
Complete payroll and CIS checks before 22 October
PAYE, National Insurance and CIS deductions for the tax month ending 5 October 2026 are due electronically by 22 October 2026.
Before submitting or paying, reconcile your payroll reports to:
- Employee gross pay and deductions
- Employer National Insurance
- Pension contributions
- Statutory payments
- Benefits and expenses processed through payroll
- CIS deductions and subcontractor records, if applicable
- The payroll bank payment
Check your employee rates as part of the review. The official National Minimum Wage rates show the rates applying from April 2026, including £12.71 per hour for workers aged 21 and over and £10.85 for workers aged 18 to 20.
A payroll reconciliation protects cash
