April brought in several important business tax changes, and some could have a direct impact on how businesses claim reliefs, manage tax filings, and stay compliant. The changes include reduced capital allowances, higher penalties for filing corporation tax returns late, and the closure of HMRC’s free corporation tax return filing portal. While some of these updates may seem technical, they could affect costs, admin, and tax planning in practical ways.
Reduced capital allowances
Capital expenditure will often qualify for a 100% deduction. Where it does not, relief is usually given through an annual writing-down allowance, or WDA.
For periods beginning on or after 1 April 2026 for companies, and 6 April 2026 for sole traders and partnerships, the main rate of WDA has been reduced from 18% to 14%.
This has a few practical consequences.
Most spending on cars does not qualify for a 100% deduction. As a result, the lower WDA means some businesses may pay more tax over time.
There is still one important exception. Spending on new, rather than second-hand, zero-emission cars continues to qualify for a 100% deduction. However, that relief is due to end on 31 March 2027 for companies and 5 April 2027 for sole traders and partnerships.
Where an accounting period spans 1 April 2026 or 6 April 2026, a hybrid WDA rate will apply.
Business tax changes to corporation tax penalties
Another of the recent business tax changes is a tougher penalty regime for late corporation tax returns.
The initial penalty for filing late has doubled to £200. If the return is more than three months late, that rises to £400.
The cost becomes more serious where there is a pattern of late filing. If returns were also late for the two previous accounting periods, the £200 and £400 penalties increase to £1,000 and £2,000 respectively.
For companies that already struggle with deadlines, this is a change worth taking seriously.
HMRC’s free filing portal has closed
HMRC closed its free online corporation tax filing service on 31 March 2026. For businesses that use an accountant or tax adviser, this may not feel especially significant. However, for anyone filing company tax returns themselves, it changes the process going forward.
Company tax returns must now be filed using commercial software. The same applies to changes or amendments to previously submitted returns.
The closure creates another issue too. Records previously held in HMRC’s online portal are no longer available there. Hopefully, those records have already been downloaded and stored securely.
A Companies House change has been postponed
There was also a planned change requiring company accounts to be filed with Companies House using commercial software from 1 April 2027. That requirement has now been postponed.
So while HMRC’s own portal has already closed, Companies House has not yet introduced the same requirement.
Why these business tax changes matter
Taken together, these business tax changes may increase tax costs for some businesses and add pressure to filing obligations for others. In some cases, the impact will be immediate. In others, it may become clearer over time as capital spending, filing behaviour, and software needs are reviewed.
That is why it makes sense to look again at how your business handles capital expenditure, corporation tax deadlines, and filing processes. A small rule change can have a wider knock-on effect than expected. The government’s guide to capital allowances remains a useful starting point for anyone wanting to understand the relief rules in more detail.