April 2026 increases to the Economic Crime Levy for professional firms

The policy measure announced in the 2025 Budget, introducing changes to the Economic Crime Levy (ECL), has now come into force with effect from April 2026. In this article we provide a brief overview of the ECL and seek to outline the key changes and their implications. 

The recent changes revise the levy bandings and significantly increase the levy for larger firms. The ECL provisions, more broadly, contain complex scoping, reference period, and collection provisions which we examine further below to support professional firms in navigating the regime.  

Scope of the levy 

Firms will be within the scope of the ECL for a particular financial year if they carry on a “regulated business” at some point in that year and have UK revenue exceeding £10.2 million. 

A “regulated business” is one falling within certain provisions of the Money Laundering Regulations and includes (amongst others) credit/financial institutions, auditors, accountants, insolvency practitioners, lawyers, and estate agents.  

When determining “UK revenue”, it is important to note that the assessment is made on an entity-by-entity basis (as opposed to at a group level) and will be based on turnover and other amounts recognised as revenue in a profit and loss account or income statement under UK GAAP. The turnover figure will, however, not be restricted to turnover attributed to the regulated business. As the terminology suggests it is necessary to look only at turnover from UK activities, so any revenue attributable to foreign permanent establishments should be excluded. 

Levy amounts 

The legislation sets out bandings to determine the levy amounts for affected firms. These bandings are based on the UK revenue of the entity in the relevant accounting period. The threshold bandings are adjusted for short accounting periods, whilst the levy can be adjusted in situations where a firm is only subject to anti-money laundering supervision for part of the financial year. 

As the above illustrates, the levy amounts have now significantly increased for larger firms (those with UK revenue exceeding £500m) with effect from April 2026 and it is important that affected firms take this into account when considering future compliance with the regime.  

It is also important to note that the legislation specifically stipulates that payments of the ECL are not deductible for tax purposes.  

Payment deadlines 

The ECL will be collected by a firm’s relevant money laundering supervisor, which will either be the Financial Conduct Authority (FCA), HM Revenue and Customs (HMRC), or the Gambling Commission (GC), and each authority employs slightly different collection and assessment mechanisms. A firm regulated by HMRC or the GC will need to self-assess and make payment on or before 30 September following the financial year in which the liability arises. Firms regulated by the FCA will only submit an ECL return when issued by a written notice and will need to make payment within 30 days of being notified of a liability.  

Reference period  

A firm’s relevant UK revenue for a financial year (1 April to 31 March) will be its UK revenue for the relevant accounting period ending in the financial year. 

For example, if a firm’s accounting period runs from 1 May 2025 to 30 April 2026. This would be the relevant accounting period for the financial year ending 31 March 2027. If the firm is regulated by HMRC, the due date for payment would therefore be 30 September after the end of the 2026/27 financial year, which would be 30 September 2027. This essentially means that the payment is being made for an accounting period that ended 17 months prior.  

If there is more than one accounting period ending in the financial year, the UK revenue for ECL purposes is the combined total of UK revenue for those accounting periods. The bandings will also need be apportioned to reflect the combined length of the accounting periods. 

Where a firm has no accounting period ending in a financial year, the relevant accounting period is to be taken as the accounting period that ends within the period of 3 months beginning with the end of the financial year, or (if no such accounting period is identified) the firm’s accounting period ending closest to the start of the financial year. 

How Moore Kingston Smith can help 

Taken together, the rules on scope, timing and computation demonstrate that the Economic Crime Levy is more than a simple fixed charge. Its interaction with accounting periods and the financial year framework introduces a layer of complexity that firms must actively manage. 

If your firm is subject to the Money Laundering Regulations, you should consider whether you need to take any action. Please contact us if you want to discuss this further.