Among the most important financial enhancements in Dynamics 365 Business Central are features such as withholding tax, a new approach to regulatory taxes, self-billing, and enhanced depreciation models. Importantly, many of these capabilities lay the foundation for further innovations that Microsoft will continue to develop in upcoming releases.
Explore the latest features!
Finance in Business Central in 2026 – explore the latest features
Withholding Tax
(Dynamics 365 Business Central, 2026 Release Wave 1)
One of the most anticipated financial features is now available out of the box in Business Central. The system enables the calculation of withholding tax for vendors, using a familiar configuration model based on posting groups.
The solution allows you to:
- automatically calculate tax during payments,
- flexibly configure settings depending on the scenario,
- adapt to different local regulatory requirements.
Microsoft plans to further develop this functionality—both based on customer feedback and already planned enhancements.
Excise Taxes (Excise Duties and Regulatory Taxes)
(Dynamics 365 Business Central, 2026 Release Wave 1)
Instead of building a solution limited to traditional excise duties, Microsoft has designed a flexible framework for handling a wide range of regulatory taxes.
The system enables the calculation of charges based on parameters such as:
- weight,
- volume,
- quantity,
- sugar content,
- alcohol content,
- active ingredients.
This approach makes it possible to support not only excise duties (e.g., alcohol, fuel), but also:
- environmental taxes (e.g., plastic taxes),
- sugar taxes,
- ESG-related regulations (e.g., CBAM, EPR).
This solution is expected to evolve rapidly, with additional scenarios and capabilities introduced in future updates.
Self-billing
(Dynamics 365 Business Central, 2026 Release Wave 1)
The new functionality enables customers to issue invoices on behalf of vendors—a well-established practice across many industries.
The solution is particularly well-suited for:
- high-volume transaction models,
- long-term business relationships,
- distribution-focused companies.
In its initial release, the feature covers the core scope of self-billing. However, Microsoft plans to further expand its capabilities, including integration with e-documents.
Expense Agent (Management)
(Feature in development)
One of the most anticipated innovations is the Expense Agent, previously introduced during Directions EMEA. Although the feature has already been announced, Microsoft has deliberately chosen not to reveal detailed information about how it works.
This does not indicate a lack of progress—quite the opposite. Everything suggests that this solution has the potential to significantly transform expense management in ERP systems, most likely through the use of AI and automation.
At this stage, Microsoft is laying the groundwork for the solution and plans to further develop it in upcoming releases.
Fixed Assets – new depreciation models
(Business Central 2026 Release Wave 1 + upcoming updates)
After a quieter period in the Fixed Assets area, Microsoft is introducing new depreciation models:
- Bonus Depreciation – enables increased depreciation in the first year,
- Accelerated Depreciation – allows companies to reflect differences between accounting and tax depreciation (planned for future releases).
These changes help better align financial reporting with both tax requirements and management needs.
Additional regulatory and localization updates
(Various 2026 Release Wave 1 updates and local enhancements)
In addition to core financial capabilities, Microsoft continues to expand regulatory compliance features across different countries. Key updates include:
- carbon footprint data in e-invoices (Denmark),
- payment practices reporting (UK, Australia),
- e-invoicing for service documents (Germany),
- further development of e-invoicing frameworks (Spain, France).
Bring the latest Business Central financial features into your company
The changes introduced in Business Central 2026 clearly show the direction of modern ERP systems—finance is no longer just about record-keeping, but is becoming a center of automation, compliance, and decision support.
For companies, this means not only greater control over processes, but also a real reduction in manual work and better preparation for increasing regulatory requirements.
If you’d like to see how Microsoft Dynamics 365 Business Central can support finance in your organization, contact us using the form below.
We’ll show you how to choose the right solution tailored to your business needs.
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