New Self Assessment Rules for Close Company Directors
Updated: Oct 24
If you're a director and shareholder of an owner-managed limited company, your Self Assessment return for the current tax year (2025/26) looks a little different. HMRC has added a new set of questions to the SA102 employment pages aimed squarely at directors of “close companies” — and for many people who run their own business, that means a bit of extra admin before the 31 January 2027 filing deadline.
The change was confirmed in the Income Tax (Additional Information to be included in Returns) Regulations 2025, effective from 6 April 2025. HMRC has also issued clarifications this month resolving some of the practical uncertainty that had built up around exactly who needs to complete the new sections, including for directors of charitable companies.
What counts as a close company
A close company is broadly one controlled by five or fewer people, or controlled by its directors however many there are. In practice, that covers the vast majority of family-run limited companies, including most of the owner-managed businesses we work with here in Bury.
What you now need to report
For each close company where you held office as a director during 2025/26, your return must now include:
The company's name
Its Companies House registration number
The total dividend income you received from that company during the year, even if it was nil
The percentage of share capital you held, even if it was nil — and if your shareholding changed during the year, the highest percentage you held at any point
The bit that catches people out
Previously, if you took no salary or benefits from your company as a director, you could often leave the SA102 employment pages off your return entirely. That's no longer a safe assumption. Under the new rules, it's likely the SA102 will need to be completed regardless, simply because of your directorship and shareholding, even in a year where you drew nothing from the company.
Why HMRC is asking
The stated aim is greater transparency around how owner-managed companies pay their directors and shareholders, and it fits a wider pattern of scrutiny in this area. HMRC has also been consulting on a further step: requiring close companies themselves to report detailed records of participator transactions — cash withdrawals, loans, dividends and asset transfers — directly to HMRC. That consultation has now closed, so it's worth keeping an eye on whether it leads to further changes. For now, though, the immediate requirement is the SA102 disclosure set out above.
What to do now
The 2025/26 tax year is already under way, so the practical thing is to start capturing the information as you go rather than trying to reconstruct it next January:
Keep a running note of each close company's name and registration number
Record every dividend declared and paid during the year, including the date and amount, even for nil dividends
Note your shareholding percentage at the point each dividend is declared, and flag any changes during the year
Don't assume you can skip the employment pages just because you took no salary or benefits
We can help
If you're a director of a close company and want to make sure your record-keeping is set up correctly for this year's return, Jackson Lee Accountants can help you get the details right from the outset rather than scrambling in January. Get in touch and we'll talk you through what applies to your situation.
Need a hand with this? We're accountants in Bury, and our limited company accounts service covers it for a fixed fee.
Talk it through with us
If this affects you, book a free, no-obligation 30-minute chat by phone, Teams or at our Bury office, or see your fixed fee online in 2 minutes. Prefer to talk now? Call 0161 327 0047.
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