In an unexpected move, HMRC have announced that we effect from April 2025, there will be new rules on dividend disclosures for anyone involved with an owner managed business.
On their self-assessment tax return, you will need to split out the amount of dividend income received from your own companies and the percentage share you hold in those companies, and disclose dividend income from other sources separately.
Three years ago, during COVID, huge numbers of owners of small businesses were not eligible for grants because HMRC said they did not have sufficient information, namely regarding private company dividends. It would seem they are going to ask for it now and if they had done so earlier, a lot of people might have been in receipt of some Government help during those difficult times.
It is not exactly clear why HMRC need this level of information but there are a number of reasons why this may increase pressure on small business owners.
Also, from 2025/26, employers will have to report the number of hours worked by individual employees. We will have to see what this all means when the time comes but one thing will be clear. It is more administration and cost for small business owners.