Impending Tax & Regulatory Changes from April 2026: What Businesses Need to Know Now
April 2026 may feel some distance away, but a number of significant tax and regulatory changes are already confirmed and will have a direct impact on business owners, directors and family enterprises.
The key message is simple: these changes reward early planning. Businesses that understand what’s coming and prepare in advance will have far more flexibility than those forced to react later.
Below, we’ve outlined the main changes to be aware of — and why now is the right time to start the conversation.
Dividend Tax Rates Are Increasing
From 6 April 2026, both basic rate and higher rate dividend tax will increase by two percentage points.
For owner-managed businesses that rely on dividends as a core part of profit extraction, this change will:
increase personal tax liabilities
narrow the gap between salary and dividend planning
make dividend timing more important
What this means in practice:
Directors should consider reviewing their extraction strategy well before April 2026 to ensure it remains efficient under the new rates.
Capital Gains Tax: BADR Rate Increase
The rate of Business Asset Disposal Relief (BADR) will increase to 18% from 6 April 2026.
BADR is often relied upon by:
business owners planning an exit
shareholders selling all or part of their business
family businesses restructuring ownership
An increase in the rate means that timing, structure and planning around disposals become even more important.
Corporation Tax Penalties Are Doubling
From 1 April 2026, penalties for late filing of Corporation Tax returns will double.
While this doesn’t change the underlying tax payable, it does significantly increase the cost of non-compliance — particularly for businesses that already struggle with deadlines.
This change reinforces the importance of:
good record keeping
timely accounts preparation
realistic filing schedules
Inheritance Tax Reliefs: Major Changes for Family Businesses and Farms
One of the most significant changes affects Agricultural Property Relief (APR) and Business Property Relief (BPR).
From April 2026:
the current 100% relief will be replaced with a £2.5 million threshold
any qualifying value above this threshold may be subject to inheritance tax
This has major implications for:
family-owned businesses
farms and land-based enterprises
succession and estate planning in Northern Ireland
For asset-rich but cash-poor businesses, this could result in difficult decisions if no planning is in place.
Capital Allowances: Reduced Writing Down Allowance
From 1 April 2026, the main rate writing down allowance (WDA) for plant and machinery will reduce from 18% to 14%.
Although full expensing and the Annual Investment Allowance (AIA) remain available, this change affects businesses where assets do not qualify for those reliefs.
The timing of capital expenditure will become more important, particularly for:
manufacturing
construction
transport and logistics
capital-intensive operations
Employment Rights and Sick Pay Changes
Potential changes to employment rights, including day-one rights and statutory sick pay reforms, are also expected to take effect.
While final detail is still emerging, employers should be aware that:
payroll costs may increase
HR policies may need updating
workforce planning could be affected
Early budgeting and payroll review will help businesses absorb these changes more smoothly.
Why Early Planning Matters
None of these changes require panic — but they do require time.
Businesses that plan early can:
spread decisions sensibly across tax years
optimise timing of dividends, disposals or investment
avoid rushed, expensive decisions
protect long-term family and business interests
How Exchange Accountants Can Help
At Exchange Accountants, we work with businesses and individuals to prepare well ahead of legislative change.
We can help you:
review dividend and profit extraction strategies
plan for business sales or succession
assess inheritance tax exposure
model capital investment timing
strengthen compliance and filing processes
prepare payroll and budgets for upcoming changes
Our approach is calm, practical and tailored — focused on giving you clarity, not creating urgency.
Start the Conversation Now
April 2026 may feel a way off, but the best planning happens early.
If you’d like to understand how these changes could affect your business or personal position, our team is here to help.
📞 028 9263 4135
📧 info@exchangeaccountants.com
🌐 www.exchangeaccountants.com
Let’s Grow Together.
