The Economic Crime Levy: the bill that lands the year your firm crosses £10.2m

Why every accountancy practice is automatically in scope

The Economic Crime (Anti-Money Laundering) Levy, usually shortened to the ECL, was introduced in April 2022 to help fund the government’s anti-money-laundering reforms. It is charged on businesses that are “relevant persons” under the Money Laundering Regulations 2017 — the same regulations that already require your firm to run client due diligence, keep a firm-wide risk assessment and name a Money Laundering Reporting Officer. Accountants, tax advisers, auditors and insolvency practitioners are named as relevant persons in those regulations by definition, which means there is no separate test to argue your way out of: if your practice does accountancy, tax, audit or insolvency work, it is in scope of the ECL regime from day one. The only question the levy actually asks is a financial one.

That question is UK revenue for the financial year running 1 April to 31 March. Below £10.2m, the levy is nil and there is nothing to register for. Above it, registration and an annual return become mandatory, and the amount due depends on which band the firm’s revenue falls into. Because the test is pure revenue rather than profit, headcount or partner numbers, a firm can cross it through ordinary organic growth, a single good year, or a merger, without anything else about how the practice is run having changed at all.

What it actually costs — and what changes from April 2026

The bands have already moved once since the levy was introduced, and they move again from 1 April 2026. The table below sets out both.

Source: HMRC’s Economic Crime Levy internal manual and published policy paper on the band changes. The “very large” charge was itself raised once already, from £250,000 to £500,000 for financial years from April 2024 — this is not a levy that has stayed still.

For the overwhelming majority of practices that could plausibly engage a fractional COO, the row that matters is the first jump: Medium, soon to be Band A, at £10.2m. The new Band C is aimed squarely at firms between £500m and £1bn — a handful of the largest national and international networks, not a regional or multi-office practice however ambitious its growth plan. If your firm is reading the £500,000 row with any concern, the ECL is the least of what needs a dedicated finance function; for everyone else, Band A is the one worth a line in the budget.

A worked example: the firm that found out in September

Take an invented sixteen-partner regional practice, not a real client of ours, turning over £9.4m this year. Growth has run at a steady 6–7% a year for the last three, which puts the firm over £10.2m within roughly eighteen months on current trend alone — before any acquisition is even on the table. The partners track revenue closely for profit share and for the firm’s own growth targets, covered in the KPIs worth tracking, but nobody has connected that number to a registration obligation, because nobody was looking for the connection. The trigger, when it comes, isn’t a letter from HMRC — it is the firm’s AML supervisor flagging during an annual return that the practice’s own reported revenue now sits above £10.2m, and asking whether it has registered for the ECL.

It has not. The firm is already liable for the year just ended, the 30 September deadline for that year has already passed, and registration, the return and the £10,000 payment are all now overdue at once — which is enough on its own to trigger the first £250 late-payment penalty before the partners have even agreed which cost centre absorbs the bill. None of this reflects badly on the firm’s compliance generally; it reflects a number that crossed a line nobody had been asked to watch.

Registration, the 30 September deadline, and what late looks like

The mechanics, once you know to look for them, are simple. If your AML supervisor is one of the accountancy profession’s own bodies, or HMRC itself — which covers essentially every accountancy, tax and audit practice — you register with and pay HMRC directly through its online ECL service. Registration is a one-off step, done the year the firm first becomes liable. After that, every year the firm remains above £10.2m, it must submit a return and pay the levy due by 30 September following the end of the financial year it relates to.

Miss that date and the penalties are fixed and tiered rather than negotiable: £250 if the levy is not paid by the due date, a further £250 if it is still unpaid 30 days later, and 5% of the amount HMRC considers due if it remains unpaid three months after the due date — on top of interest running throughout. None of those figures are large next to a £10,000 charge, but they are a wholly avoidable cost, and the kind of thing a reviewer or a professional-body inspector notes as a sign that a firm’s compliance calendar has a gap in it, in the same spirit as the findings covered in the ICAEW Practice Assurance visit.

What to do about it, starting now

• Pull last year’s UK revenue figure today and check it against £10.2m. If you are already above it and have not registered, that is this week’s task, not next quarter’s.
• Project two years forward on current growth alone, before factoring in any merger or acquisition under discussion — a bolt-on that adds even £1m of fee income can tip a firm over the line on completion day.
• Name one owner for tracking the firm’s UK revenue against the £10.2m line, the same way a named owner tracks every other recurring compliance date — this is exactly the kind of item that belongs on a quarterly operating review rather than in nobody’s inbox.
• Budget for £10,200, not £10,000, the moment the trend line shows the firm closing in — the new band rate applies to financial years from 1 April 2026, with the first return under it due 30 September 2027.
• Register the moment the firm is confidently forecast to cross the threshold rather than waiting for the year-end accounts to confirm it, so the first return is never also the first time anyone in the firm has thought about the levy at all.

None of this is difficult once somebody owns it. It is a short, boring, entirely predictable addition to the compliance calendar of a growing practice — which is precisely the kind of item that falls through the gap in a founder-led firm, where revenue is watched closely for growth and profit share but rarely for what crossing a specific number actually triggers. That is the same operating discipline described in what is operating discipline, and it is the kind of forward-looking line Optivo’s Monthly COO keeps on a running list, precisely because a predictable cost is only ever a surprise to a firm that wasn’t watching for it.