HLAS

Besides the new property income tax rates detailed in the taxes on income section, another change affecting property is the introduction of a high value council tax surcharge, otherwise known as the ‘mansion tax’.  The surcharge will be in addition to existing council tax and will be applied to properties with a value over £2 million. The mansion tax will range from £2,500 to £7,500 depending on the property’s value.  Properties will be valued before the introduction of the tax. The mansion tax is applied to the homeowner and not the council tax payer. Both of these measures will mean [...]

IHT can apply to certain lifetime transfers/gifts and also on the value of an individual’s estate at the time of death. The IHT nil rate band is £325,000, with an additional £175,000 ‘residence nil rate band’ available in some cases for leaving the family home to direct descendants. For any value remaining after the nil rate bands and IHT reliefs and exemptions, the maximum rate of IHT remains at 40%. The IHT nil rate band remains frozen at £325,000 for a further year until 2031. The residence nil rate band will also remain frozen at £175,000 until 2031. The residence [...]

National Insurance Contributions (NICs) NICs deducted from employee wages remain at the same levels as we head into 2026/27. This means that, for employees, no NICs are deducted on the first £12,570 of pay, then a rate of 8% applies on earnings up to £50,270, with a rate of 2% applied thereafter. For employers, the rate of NICs will remain at 15% after the first £5,000* paid to each employee. The available employment allowance to offset this cost remains at £10,500 for eligible claimants. *A higher threshold of £50,270 applies for employees who are under 21 and apprentices under 25. [...]

Business rates As announced in the 2024 Budget, two new lower multipliers for eligible retail, hospitality and leisure (RHL) properties with rateable values (RV) below £500,000 will be introduced from 1 April 2026. Each of the new multipliers is 5p lower than the standard multiplier for a business property of equivalent rateable value. The new multipliers will replace the 40% relief given to RHL businesses in 2025/26 and will be funded by a high-value multiplier on properties that have a rateable value above £500,000. Legislation and local authority guidance has already been published confirming the eligibility criteria for RHL properties. [...]

Updates are continuing to come through on HMRC’s ‘Making Tax Digital for Income Tax’ (‘MTD for IT’) initiative. It will initially apply from 6 April 2026 for sole traders and property landlords who generated gross trade and rental income (‘qualifying income’) of more than £50,000 in the 2024/25 tax year. The MTD for IT rules are mandatory and, if affected, you will be required to use ‘MTD-compatible software’ to maintain digital records and send a quarterly summary of your business and/or property income and expenses to HMRC, along with your end-of-year tax return. In a welcome announcement, the government said [...]

Your personal allowance Your tax-free personal allowance will remain at £12,570 in 2026/27. The personal allowance is partially withdrawn if your income is over £100,000 and then fully withdrawn if your income is over £125,140. Income tax rates and allowances For 2026/27, the income tax thresholds are unchanged from 2025/26 and are set to remain static until 2030/31. The only rates that will increase from 6 April 2026 are the basic and higher tax rates on dividend income. After your tax-free ‘personal allowance’ has been deducted, your remaining income will be taxed in bands in 2026/27 as follows: ‘Other income’ [...]

Practical actions to help businesses boost security The National Cyber Security Centre (NCSC) has launched a new free Cyber Action Toolkit to help small businesses strengthen their cyber defences in a simple and affordable way. The toolkit has been designed for businesses that may not have in-house IT expertise or large security budgets, offering clear, practical steps that can be implemented straight away. Helping small businesses take action NCSC recognises that many small businesses find cybersecurity daunting, perhaps feeling that it is too technical, too costly, or simply not a priority. The sheer volume of guidance available can also be [...]

Is it time to review your business’s cash reserves? The Prudential Regulation Authority (PRA) has confirmed that the Financial Services Compensation Scheme (FSCS) deposit protection limit increases from £85,000 to £120,000 from the start of December. The new threshold applies per depositor, per PRA-authorised bank, building society or credit union. The PRA have confirmed that HM Treasury has approved the change. This is the first change to the limit since 2017 and follows a consultation earlier in the year. The PRA had initially proposed that the limit should rise to £110,000, but feedback provided in the consultation and the latest [...]

The government has announced the new minimum wage rates that will come into force from 1 April 2026. The new rates are as follows: The new rates mean that workers aged 21 and over will get a 4.1% increase. It is estimated that 2.4 million workers will benefit from the rise, with a further 300,000 apprentices and workers aged under 21 being given a rise of between 6.0% and 8.5%. The larger rise for younger workers is part of the government’s efforts to work towards having a single rate for workers regardless of age. What should you do about this? [...]

After weeks of speculation about what Budget 2025 would contain, the Chancellor was unexpectedly upstaged when the Office for Budget Responsibility (OBR) accidentally published their report revealing key policy measures ahead of the official announcement. Although the report was quickly withdrawn, the information had already been picked up by media outlets and tax commentators. Ultimately, however, the manner in which the details were released matters less than the substance of the policies themselves. It is the impact of these measures that will be felt over the coming years. How does Budget 2025 affect your business? Let’s take a closer look [...]