If your firm is supervised under the UK's anti-money laundering rules and your UK revenue crossed £10.2 million, you owe the government money by 30 September — and the return that goes with it. Miss the deadline and HMRC starts with a £250 penalty and adds interest, with a 5% charge waiting three months later. This guide walks through who the Economic Crime Levy catches, how the revenue bands work under both the current and new rates, and how to reconcile the September payment cleanly in your books.
What the Economic Crime Levy Is
The Economic Crime Levy is an annual charge on organisations supervised under the Money Laundering Regulations. It was introduced to help fund the government's work tackling economic crime, and it applies for every financial year running 1 April to 31 March.
Two conditions decide whether your business is in scope:
- You carry on activity supervised under the Money Laundering Regulations — as a credit or financial institution, auditor, accountant, tax adviser, lawyer, estate agent, high value dealer, money service business, trust or company service provider, or one of the other regulated sectors.
- Your UK revenue exceeds £10.2 million for the accounting period ending in the levy year.
Both conditions must hold. A large business outside the regulated sectors pays nothing, and a regulated firm at or below the £10.2 million line pays nothing either — though, as explained below, small firms may still have filing expectations.
Who supervises you decides where you file
There are three collection routes, and this is where many businesses stumble:
- Supervised by HMRC or a professional body (for example, an accountancy firm supervised by its institute, or an estate agency supervised by HMRC): you register with HMRC, submit your levy return to HMRC, and pay HMRC.
- Supervised by the Financial Conduct Authority: you follow the FCA's reporting and payment process instead. Do not register or pay through HMRC.
- Supervised by the Gambling Commission: you follow the Gambling Commission's process instead.
If you are supervised by both HMRC and the FCA, or by both HMRC and the Gambling Commission, the FCA or Gambling Commission route takes precedence. Registering with the wrong collector is one of the most common compliance mistakes — confirm your supervisor before you do anything else.
HMRC directly supervises money service businesses, high value dealers handling cash payments of 10,000 euros or more, trust or company service providers, accountancy service providers, estate agency businesses, and bill payment and telecoms payment service providers, in each case where no other supervisor covers them.
Do You Need to File? Ask These Three Questions
Work through these in order every year, because the answer can change as your revenue moves.
1. Were you carrying on regulated activity in the financial year?
The levy year runs 1 April to 31 March. If you started regulated activity partway through the year, you tell HMRC the start date at registration, and the amount can be reduced to reflect a part-year of regulated activity. If you stopped being regulated entirely, check your supervisor's guidance on whether a final return is due.
2. Which supervisor covers you?
As above: HMRC or professional body means the HMRC route; FCA or Gambling Commission means their route. Small entities supervised by the FCA or Gambling Commission may still be asked to submit revenue information or a nil return even though no fee is due, so do not assume that being below the threshold ends your obligations.
3. Did your UK revenue exceed £10.2 million?
The band test uses UK revenue for accounting periods ending within the financial year — not worldwide group turnover, and not profit. If your accounting period is not 12 months, the £10.2 million threshold and the band limits are adjusted proportionately by days, so a short period lowers the bar for crossing into a paying band. Pull the figure from your statutory accounts workpapers and keep the calculation: HMRC can ask how you derived your band.
Note the boundary wording carefully: small means £10.2 million or less, and the paying bands start above £10.2 million. A firm with exactly £10.2 million of UK revenue is small and exempt.
The Revenue Bands: What You Actually Pay
Because the rates changed, the amount depends on which financial year you are paying for. Keep the two schedules straight — they are easy to confuse.
Fees for 2025–26, payable by 30 September 2026
| UK revenue | Size | Fee |
|---|---|---|
| £10.2 million or less | Small | No fee |
| More than £10.2 million, up to £36 million | Medium | £10,000 |
| More than £36 million, up to £1 billion | Large | £36,000 |
| More than £1 billion | Very large | £500,000 |
The very large fee doubled from £250,000 to £500,000 starting with the year beginning 1 April 2024, so if your only memory of the levy is the original launch figures, update your accrual.
New bands from 1 April 2026, first payable in September 2027
The Finance Act 2026 split the old large band and rebased the charges. These apply to the financial year beginning 1 April 2026, with the first payments under the new rates due by 30 September 2027:
| UK revenue | Band | Fee |
|---|---|---|
| £10.2 million or less | Small | No fee |
| More than £10.2 million, up to £36 million | Band A | £10,200 |
| More than £36 million, up to £500 million | Band B | £36,000 |
| More than £500 million, up to £1 billion | Band C | £500,000 |
| More than £1 billion | Band D | £1 million |
Each charge is set at 0.1% of revenue at the bottom of its band. The practical effect: firms between £500 million and £1 billion jump from £36,000 to £500,000, and firms above £1 billion double from £500,000 to £1 million. If your business sits anywhere near those lines, model next year's liability now rather than discovering it at close.
Adjustments that change the bill
- Non-12-month accounting periods: thresholds and band limits scale by days in the period.
- Part-year regulated activity: the levy can be reduced where you carried on regulated activity for only part of the financial year.
- Group structures: the test applies per entity by reference to its own UK revenue and supervision, so map every regulated entity in the group separately rather than assuming one filing covers all.
The September Reconciliation: Return First, Then Payment
The process runs in a fixed order: register, submit the return, then pay. You cannot pay correctly until the return is in, because the return generates the payment reference.
Step 1: Register before you file
Register as soon as you know you are in scope — payments are due 30 September every year, and registration takes time. You will need your UK revenue for the last financial year, the date you started regulated activity if that was in the past year, your business sector, and information about the length of your accounting period.
Step 2: Submit the annual return
You must submit a return each year if you are registered and meet the paying threshold. HMRC also asks registered businesses to keep submitting returns in years they fall back below the threshold, so do not treat a quiet year as an exit from the system without checking. After submission, HMRC emails a confirmation containing your 14-character return reference starting with X — keep it somewhere your finance team can find it, because the payment step depends on it.
Step 3: Pay by 30 September
Payment options include paying online through your bank account, Direct Debit, debit or corporate credit card, and bank transfer. Three details matter for a clean reconciliation:
- Use the 14-character return reference exactly. An incorrect reference delays allocation of your payment, and an unallocated payment looks unpaid to the penalty clock.
- Mind the weekend rule. If 30 September falls on a weekend or bank holiday, your payment must reach HMRC by the end of the previous working day. Bank transfer timings count by receipt, not by the day you clicked send.
- Match the return to the payment. The amount on the bank line must equal the liability on the submitted return. If you later amend the return upward, pay the difference promptly — late-payment penalties apply to the additional amount from the original due date.
Common mistakes to avoid
- Filing with HMRC when your supervisor is the FCA or Gambling Commission, or vice versa. Pick the route by supervisor, not by habit.
- Testing worldwide revenue instead of UK revenue. Overseas turnover does not count toward the band.
- Forgetting the pro-rata adjustment on a short or long accounting period.
- Treating the confirmation email as the end of the job. The return without the payment still leaves the full liability — and the penalties — outstanding.
- Assuming last year's band repeats. Revenue near a boundary can tip you into a different band, and from the 2026–27 year the bands themselves are different.
What Happens If You Miss It
The penalty structure is mechanical, so calendar discipline is the whole game:
- Late payment: a £250 penalty if the levy is still unpaid 30 days after the due date, rising to 5% of the levy due once the payment is three months late. Interest also accrues.
- Inaccurate or incomplete return: a penalty of £250 or 5% of the difference between the levy paid and the levy actually due, where the error understates the liability.
On a £10,000 medium-entity liability, three months of drift turns into a £500 penalty plus interest — a 5% surcharge for what is usually just a missed diary entry. Put the return and the payment on the compliance calendar as two separate items with different owners if needed, because they are two separate obligations.
How to Record the Levy in Your Books
The levy deserves its own nominal code rather than disappearing into general rates and levies, because it has an unusual tax property: the Economic Crime Levy is not deductible for corporation tax purposes. That means your bookkeeping needs to do three things:
- Accrue it in the right period. Recognise the liability in the financial year it relates to, even though the cash goes out the following September. A September payment with no prior accrual misstates both years.
- Add it back in the tax computation. Since the levy is not an allowable deduction, add the full amount back to accounting profit when computing taxable profit. Keep the add-back on a labelled line so next year's preparer does not have to rediscover the rule.
- File the workpapers with the return. Keep the UK revenue calculation, the band determination (including any pro-rata maths for a non-standard period), the submitted return, the X-reference confirmation, and the bank evidence of payment together. If HMRC queries the band two years later, that packet is your answer.
If your firm sits close to the £10.2 million line, track UK revenue quarterly against the pro-rated threshold during the year. Crossing the line mid-year-end should be a planned event with an accrual ready, not a surprise found at close.
Simplify Your Financial Management
Staying on top of obligations like the Economic Crime Levy — knowing which band you fall in, accruing the charge in the right period, and reconciling the September payment to the return — is exactly the kind of disciplined financial tracking that keeps a regulated business out of trouble. Beancount.io provides plain-text accounting that gives you complete transparency and control over your financial data, with version-controlled records your auditors will love. Get started for free and see why developers and finance professionals are switching to plain-text accounting.
