The 2025/26 tax year kicks off on 6th April 2025 and runs until April 2026.
For scaling business owners, now is the perfect time to get ahead by refining your financial strategy, making the most of tax allowances and setting your business up for sustainable growth.
We’ve put together this practical guide to help you prepare your business for the upcoming tax year.
Reviewing your financial performance
Before looking ahead, take the time to reflect and review your business performance over the last 12 months.
Reviewing key financial reports, such as profit and loss statements, cash flow reports and tax returns, can highlight areas for improvement.
Some key areas to focus on are:
- Revenue trends and profitability
- Major expenses and cost-saving opportunities
- Cash flow patterns for the year ahead
- Debt management
If you’re not already tracking key performance indicators, now is a great time to start. Metrics like gross profit margin and customer acquisition costs will help you make informed decisions and measure success.
Ensure your accounts are up to date
A well-organised accounting system makes tax planning and financial forecasting so much easier (and far less stressful).
Make sure that all invoices and expenses are recorded correctly, bank reconciliations are completed, and payroll records are accurate and compliant.
Still relying on spreadsheets or outdated software? Now’s the time to think about switching to a cloud-based system like Xero. Trust us, it’ll save you time and effort.
Understanding 2025/26 tax allowances and reliefs
There are several tax reliefs available that can help scaling businesses save money. Make sure you take full advantage and explore potential tax benefits like:
- R&D Tax Relief: If you’re investing in innovation, make sure you’re claiming any R&D relief you’re entitled to.
- Annual Investment Allowance (AIA): Maximise tax relief on capital expenditure.
- Employment Allowance: Reduce National Insurance costs if your business qualifies.
It’s also worth keeping up to speed on Corporation Tax Rates and understanding how any rate changes impact your profits.
If you’re looking to raise some external funding, make sure you check out tax approved schemes like SEIS (Seed Enterprise Investment Scheme) and EIS (Enterprise Investment Scheme).
If this seems like a lot to handle, don’t panic – we can help identify the best tax-saving strategies tailored to your business.
Stay on top of cash flow and budgeting
Cash flow challenges are common for growing businesses, so planning ahead is key.
Create a budget for the year ahead, forecasting revenue, expenses and seasonal fluctuations. Cash flow forecasting will also make sure you have funds available throughout the year for reinvestment and growth.
You should also plan ahead for key tax deadlines. Staying ahead of VAT returns and tax payments will help you avoid penalties.
If you want support with this, our 2025 Business Strategy Guide covers forecasting and key deadlines to help you prepare.
Staying compliant with changing regulations
With tax rules changing regularly, keeping on top of compliance helps you steer clear of penalties and keep your finances in good shape.
- Employment and Payroll Compliance: Make sure payroll records reflect any changes in National Insurance rates and minimum wage adjustments. On April 1st, National Living Wage will rise from £11.44 to £12.21, and on April 6th, Employers NIC will increase from 13.8% to 15%.
- VAT and Tax Filing Deadlines: Keep track of submission deadlines to avoid late penalties.
- New Business legislation: Stay informed about any updates affecting your sector, such as environmental policies or reporting requirements.
Seeking professional advice
As your business grows, tax planning gets more complex, and let’s be honest, you’ll only get busier.
Having an accountant in your corner doesn’t just ensure compliance, it also frees up your time and reduces stress. The right support can help you:
- Identify tax efficiencies specific to your industry.
- Implement financial systems that streamline your reporting.
- Optimise your business structure for long-term growth.
- Stay ahead of deadlines – without last-minute panic.
- Pro-actively plan for the future, and not just react
Need help preparing?
Preparing for the new tax year isn’t just about ticking boxes, it’s about making sure your business is set up for success.
If you need tailored advice to help your business prepare, get in touch with our team today.
