HMRC Update for all Directors

A report published by HMRC on 19 March 2026 has not received widespread attention, but I believe it will have significant implications for all limited company directors and business owners.

My understanding here, simply put, is that HMRC will be tightening the rules around how companies record and report transactions between the company and its directors and shareholders.

This covers things like director's loan accounts, drawings and dividends.

HMRC have said the small business corporation "tax gap" is now £14.7 billion, and they want more visibility over what is happening inside companies.

The initial HMRC consultation runs until 10 June 2026 and whilst nothing has changed yet, the direction of travel is clear that HMRC want more detail, more frequently.

If you are a limited company director, make sure your director's loan account is up to date and recorded properly, and that your dividends are properly documented with board minutes and dividend vouchers, and there is a clear paper trail for anything moving between you and your company.

This is good practice anyway, but it is going to matter a lot more in the coming years.

If you are not sure whether your records are where they need to be, it is worth having a conversation with your accountant now rather than waiting until the rules change.

You can read the full consultation here:

https://www.gov.uk/government/consultations/reporting-company-payments-to-participators