Accounting advice for small business owners – prepare for a successful 2026

We’re a few weeks into 2026 now but, when it comes to planning for the year ahead, there’s still plenty to consider – with changes on the horizon for the new financial year, and much to learn from looking back at the past year.

To set yourself up for success in 2026, my advice would be:

Reflect on 2025’s performance

A great place to start is to make sure you dedicate time to reviewing how 2025 was for your business. What were the achievements and shortfalls? A SWOT analysis is a good framework to follow when defining the company’s goals for 2026.

Take time away from the day-to-day of the business and give this exercise your full attention – taking a day out can give you the chance to properly think through and formalise your plans for the year ahead. You know what they say – fail to prepare, prepare to fail.

Take an honest look at the risks or threats your business faced in 2025, consider whether that threat will continue into 2026 and, if so, what you can do to prepare and improve the situation this year.

Take time to reflect on the successes of last year, to make sure you’re making the most of those opportunities and not missing a trick, such as a new revenue steam.

Consider your budgets, projections and cash flows – what could you potentially invest in the business to grow it?

Maintaining your current levels through retaining your staff is always important, or maybe you’re looking to increase the capability within the business by hiring more of the right people. Being competitive in the hiring market means offering the right incentives (see salary sacrifice below), so make sure your benefits package is in good shape.

Consider your long-term plans

When thinking about your plans for 2026, look at this in the context of your longer-term plans for your business. If you’re planning to retire in five or 10 years’ time, start putting some thought into this process now – there might be changes you’d like to make as part of a succession plan, and these take time to implement successfully.

Get ready for Making Tax Digital

Making Tax Digital (MTD) is a HMRC digital reporting system which is becoming mandatory in phases for sole traders and landlords with qualifying income of more than £20,000.

Be sure to check the details to understand if your business meets the criteria and if so, when you will need to comply with its requirements. Even if it’s not compulsory to make use of it yet, it’s advisable to prepare in advance.

Our 2024 survey found that at the time, less than half of Warwickshire business leaders were fully prepared for Making Tax Digital – so make sure you’re ready and don’t get caught out by the changes.

From 6 April 2026, MTD for income tax will become mandatory for the self-employed and landlords whose qualifying annual income is more than £50,000. Requirements will include keeping digital records and making digital submissions.

Changes to tax rates for dividends

With tax rates for dividends set to increase by 2% in April 2026, time is running out to factor this into your tax planning.

If you’re a business owner or shareholder in a limited company and you’re considering taking a dividend from the business, be mindful of this deadline and don’t delay in acting.

Salary sacrifice

Changes to salary sacrifice will not come into effect until April 2029, but it’s worth considering this now and factoring it into your plans for the next three years.

From April 2029, a cap will be put in place so that just the first £2,000 of contributions which an employee makes to a pension via salary sacrifice each year will be exempt from National Insurance contributions. Currently, there is no cap in place, making paying into a pension via salary sacrifice an attractive option.

Businesses who offer employees the choice to make pension contributions via salary sacrifice currently benefit from a reduction in their own National Insurance liabilities, as salary sacrifice effectively reduces net salary.

The introduction of this cap will effectively remove a great deal of a workplace benefit, and benefits can be key to attracting and retaining the right talent to your business – so it is worth reviewing your benefits package in light of the salary sacrifice changes.

If key employees commute or travel for business, a company electric car may be an alternative attractive workplace benefit. If it’s not industry standard in your industry to offer private healthcare as part of a benefits package, you could set your business apart from its competitors by offering this benefit when others do not.

With the salary sacrifice changes on the horizon, albeit in three years’ time, it’s a good time to start strategising around your recruitment and retention, to ensure your business holds on to its key employees to support its stability and growth.

Automation and creating new systems

Try automation or introducing new ways of working to support your business. If you’re not the best at chasing invoices and payments aren’t being received on time, your cash flow will suffer – so preventing this is central to maintaining the ongoing health of your business.

If you’re looking for accounting advice for small business owners, we’re here to help

At Prime Accountants Group, we work with businesses in different industries and based across the UK to advise them, so they have the advice they need to help grow their business.