September 2025 Newsletter
Autumn Budget to be delivered on 26 November
The Autumn Budget will be delivered on 26 November by the Chancellor of the Exchequer, HM Treasury has announced.
￫ Read more
The Office for Budget Responsibility's latest outlook for the economy and public finances will be released on the same day.
The Budget outlines the government's plans for raising or lowering taxes and sets out its spending commitments for health, schools, police and other public services.
Chancellor of the Exchequer, Rachel Reeves said:
'Britain's economy isn't broken. But I know it's not working well enough for working people. Bills are high. Getting ahead feels tougher. You put more in, get less out. That has to change.
We've got huge potential - world-leading brands, dynamic industries, brilliant universities, and a skilled workforce. We're a global hub for trade.
Fixing the foundations has been my mission this past year … but I'm not satisfied. There's more to do. Cost of living pressures are still real.
And we must bring inflation and borrowing costs down by keeping a tight grip on day-to-day spending through our non-negotiable fiscal rules. It's only by doing this can we afford to do the things we want to do.
If renewal is our mission and growth are our challenge. Investment and reform are our tools. The tools to building an economy that works for you - and rewards you.'
Source: GOV.UK Website
Over 850,000 self-employed to be pulled into first phase of Making Tax Digital
HMRC has confirmed that 864,000 self-employed workers and landlords will be pulled into the quarterly reporting rules for Making Tax Digital (MTD) for Income Tax when it comes into force.
￫ Read more
The first phase of MTD for Income Tax will begin next April at the start of the 2026/27 tax year. It will require individuals with a qualifying income over £50,000 to file quarterly returns using software with a final year end round out.
When businesses need to start using MTD for Income Tax depends on their qualifying income within a tax year. If their qualifying income is over:
- £50,000 for the 2024/25 tax year, they will need to use it from 6 April 2026
- £30,000 for the 2025/26 tax year, they will need to use it from 6 April 2027
- £20,000 for the 2026/27 tax year, they will need to use it from 6 April 2028
According to HMRC, around 2.9 million have a qualifying income above £20,000 and will need to join MTD for Income Tax, based on self assessment figures for 2023/24.
HMRC said:
'MTD for Income Tax is a new way for sole traders and landlords to report their income and expenses to HMRC. They will need to keep digital records and every quarter, submit simple summaries of their income and expenses to HMRC using compatible software. This is expected to reduce the tax gap by reducing the scope for error and failure to take reasonable care.'
Source: GOV.UK Website
Homebuyers get bogus SDLT claims warning
Homebuyers are being warned to avoid Stamp Duty Land Tax (SDLT) scams, following a landmark Court of Appeal decision.
￫ Read more
HMRC is warning buyers to be vigilant of tax agents offering to secure (SDLT) repayments on their behalf where repairs are needed to a property they have bought.
Some agents have suggested that, for a fee, they can reclaim SDLT the buyer has already paid by saying that the property is non-residential because it's uninhabitable.
But HMRC says that making claims of this kind often leave the homeowner liable for the full amount of SDLT, plus penalties and interest.
A recent Court of Appeal judgment in the case of Mudan & Anor v HMRC has confirmed that housing in need of repair is chargeable at the residential rates of SDLT, and that repayment claims based solely on a property's condition are not valid.
HMRC says it is taking decisive action on spurious SDLT repayment claims, using civil and criminal powers.
Anthony Burke, HMRCs Deputy Director of Compliance Assets, said:
'The Court of Appeal's decision is a major win, protecting public funds. Homebuyers should be cautious of allowing someone to make a SDLT repayment claim on their behalf. If the claim is inaccurate, you could end up paying more than the amount you were trying to recover.'
Source: HMRC Website
Crackdown on late payments launched in plan to back small businesses
The government is set to tackle late payments to businesses with significant legislative reforms.
￫ Read more
Late payments cost the UK economy £11 billion a year and shut down 38 businesses every day, according to the government.
The new laws are set to give stronger powers to the Small Business Commissioner to empower them to wield fines, worth potentially millions of pounds, against the biggest firms who persistently choose to pay their suppliers late.
Following the legislation, the UK will have the toughest late payments laws in the G7, the government added.
The legislation is part of reforms to back small businesses and unlock growth as part of the Plan for Change.
Business and Trade Secretary Jonathan Reynolds said:
'This country is home to some of the brightest entrepreneurs and innovative businesses in the world, and we want to unleash their full potential by giving them back time and money to do what they do best - growing our local economies.
Our Small Business plan – the first in over a decade – is slashing unnecessary admin costs, making it easier for businesses to set up shop and giving SMEs the financial backing they need.
This is our Plan for Change in action, putting more money in people's pockets, boosting local communities and ensuring Britain is a great place to do business and thrive.'
Source: GOV.UK Website
SME exporters hit by new US customs charges
President Trump's decision to charge import duties for low value goods entering the US is a major blow to the UK's SME exporters, says the British Chambers of Commerce (BCC).
￫ Read more
Under an Executive Order issued by the President, duties will be payable on goods valued under $800 from 29 August 2025. These will be in line with the rates applied to other goods from each country in accordance with its tariff rates.
For most UK goods export sectors this means the tariff rate they used to have plus the additional 10% reciprocal rate applied to most UK goods since April.
Alternatively, for the first six months only, a specific rate of $80 per item would apply to low value packages from the UK entering the US. After that period, the duties described above will be enforced on all packages of UK origin in scope.
William Bain, Head of Trade Policy, said:
'This development has been coming for several months but is still a major blow to UK exporters to the US. Smaller firms and sole traders, who have invested strongly in e-commerce sales internationally, will be worst hit.
But the UK is in a comparatively advantageous position in terms of these additional duties compared with those faced by other countries.
The EU is also likely to scrap its de minimis threshold by 2028, and the UK government is launching a review into removing the threshold here too.'
Source: White House Website, BCC Website
HMRC splits advisory fuel rates for electric cars
HMRC has split fuel advisory rates for electric cars depending on where drivers charge their company cars due to the price discrepancy between home and public chargers.
￫ Read more
From 1 September 2025, the single rate for fully electric cars will be abolished and replaced with two different rates reflecting whether a car is charged at home or on a public charger.
The rate will be 8 pence per mile for home charging and 14 pence per mile for public charging. This will replace the current universal rate of 7 pence per mile.
These rates will be reviewed quarterly in line with petrol and diesel advisory fuel rates.
HMRC said:
'The 'Domestic electricity cost per kilowatt-hour' is the Department for Energy Security and Net Zero annually published figure, uprated with the latest estimate of electricity prices from the Office for National Statistics.
The 'slow or fast public charge cost per kilowatt-hour' is the Zapmap public charging price index monthly published figure for slow or fast chargers (charging speed less than 50 kilowatts), uprated with the latest estimate of electricity prices from the Office for National Statistics.
A higher amount than the advisory rates can be used as long as you can show that the fuel cost per mile is higher. Therefore, if the public charger used is higher in cost per mile than the new advisory rate introduced for public charging, a higher rate can be used as long as you can show the cost per mile is higher.'
Source: GOV.UK Website
Advisory fuel rates for company cars
New company car advisory fuel rates have been published and took effect from 1 September 2025.
￫ Read more
The guidance states: 'you can use the previous rates for up to one month from the date the new rates apply'. The rates only apply to employees using a company car.
The advisory fuel rates for journeys undertaken on or after 1 September 2025 are:
HMRC guidance states that the rates only apply when you either:
- reimburse employees for business travel in their company cars
- require employees to repay the cost of fuel used for private travel.
You must not use these rates in any other circumstances.
The Advisory Electricity Rate for fully electric cars is below. Electricity is not a fuel for car fuel benefit purposes.
If you would like to discuss your company car policy, please contact us
Source: GOV.UK Website
Latest guidance for employers
HMRC has published the latest issue of the Employer Bulletin.
￫ Read more
The August issue has information on various topics, including:
- P11D and P11D(b) for tax year 2024/25
- PAYE Settlement Agreement - calculations and payment
- employers PAYE disputed charges
- Spotlight 69 - liquidation of a Limited Liability Partnership used to avoid Capital Gains Tax
- implementation of the Employment Rights Bill.
Source: GOV.UK Website
