Capital allowances remain one of the most valuable tools available to limited companies. They allow businesses to deduct the cost of equipment and machinery from their taxable profits. The Autumn Budget introduced new measures that strengthen the system and give companies more certainty when planning investment. November is the first full month for businesses to digest these updates. Many companies are finalising year end plans, so this is the ideal time to understand how the new rules affect purchases of equipment, vehicles and technology. With Corporation Tax remaining unchanged, capital allowances play a central role in managing tax burdens and improving cashflow. Capital Allowances The Capital Allowances update focuses on three key points. These include the extension of full expensing, the confirmation of the Annual Investment Allowance and the clarification of certain first year allowances. The Autumn Budget confirmed that full expensing will continue beyond the current tax year. This measure allows companies to deduct one hundred percent of the cost of qualifying plant and machinery in the year of purchase. The extension provides much needed stability. Businesses can now plan medium term investment without worrying that relief will be withdrawn at short notice. The Annual Investment Allowance remains set at one million pounds. This covers the vast majority of small and medium sized companies. It allows businesses to claim the full cost of most equipment and assets in the year the cost is incurred. This simplifies the process and reduces the need for complicated calculations over several years. There has also been clarification on which assets qualify for first year allowances. These include environmentally efficient equipment and certain low emission vehicles. The rules are now more consistent. This reduces confusion and helps companies decide whether a first year allowance or full expensing gives the better outcome. These changes are designed to support investment. The government sees capital allowances as a way to stimulate productivity and to encourage companies to modernise their equipment. For small businesses, the combined effect is a more predictable and generous system. How it impacts you For limited company directors, these updates influence both tax planning and purchasing decisions. When a business invests in new equipment, the timing of that purchase can affect the Corporation Tax bill for the year. The extension of full expensing means that bringing forward planned investment may produce immediate tax relief rather than spreading deductions over several years. Companies with upcoming year ends should review existing plans. Even modest purchases can create meaningful tax savings when deducted in full. This is especially helpful for businesses that have experienced fluctuating profits. Full expensing allows tax relief to match periods of higher earnings more closely. Directors should also consider the nature of the assets they intend to purchase. Some assets qualify for first year allowances that exceed standard writing down rates. This means the type of equipment chosen can affect the total tax relief available. Clarity in the updated rules helps avoid mistakes and ensures that businesses do not miss out on relief they were entitled to claim. Additionally, companies operating across multiple sites or using fleets should carefully assess vehicle and machinery plans. Low emission equipment may carry specific allowances that provide extra benefits. Understanding these options early in the purchasing process ensures the right decisions are made. What you can do Start by reviewing your planned asset purchases for the remainder of the year. Consider whether bringing those purchases forward or delaying them until after the new rules take effect will deliver the best tax outcome. Accurate forecasting is essential. It helps determine where full expensing or the Annual Investment Allowance can provide the most value. Next, gather a complete list of existing assets and review their current allowances. Some items may qualify for enhanced relief, particularly if they fall under new first year allowance categories. Checking this now avoids missing opportunities when preparing year end accounts. Speak with your accountant before committing to major purchases. The updated rules may shift the optimal timing or method of buying equipment. In some cases leasing arrangements may provide flexibility, while outright purchases may provide immediate tax relief. Each situation is unique and requires proper analysis. For businesses planning larger investments, consider whether cashflow allows for accelerated spending. When used correctly, capital allowances can significantly reduce Corporation Tax liabilities. This can free up funds to reinvest in staff, equipment or expansion. Ledgr Accountants works with clients to map out investment plans and forecast the tax impact. By reviewing options early, we ensure that every client gets the maximum benefit from the new capital allowance rules. Thowsif Mukit Commercial Manager References https://www.gov.uk/capital-allowances https://www.gov.uk/guidance/check-if-you-can-claim-full-expensing-or-50-first-year-allowances https://www.gov.uk/capital-allowances/annual-investment-allowance

Making Tax Digital (MTD) is approaching its next major phase. From April 2026 many sole traders and landlords will begin using digital record keeping and submitting quarterly updates to HMRC. This marks one of the most significant changes to the tax system in recent years. Updated guidance released this autumn provides clearer detail on deadlines and the type of digital records required. By late November taxpayers are starting to consider how these rules will shape their work in the new year. Many already use bookkeeping software, but Making Tax Digital introduces strict requirements about how records are kept and how information is transferred to HMRC. This means early preparation is essential. MTD Updates The MTD Update confirms that the first phase of Making Tax Digital for Income Tax will begin in April 2026. This will apply to individuals with annual business or property income above fifty thousand pounds. The second phase will begin in April 2027 for individuals with income between thirty thousand and fifty thousand pounds. These thresholds provide a phased approach and allow taxpayers to prepare gradually. HMRC has expanded the Making Tax Digital pilot scheme. More taxpayers can now join even if they have additional income sources or more complex tax circumstances. The pilot is designed to test software compatibility and allow taxpayers to practise digital reporting before the rules become mandatory. This wider access marks a shift towards a stronger testing environment before full rollout. New guidance also clarifies what digital record keeping involves. Every business transaction must be recorded digitally. This includes income, expenses and property related costs. The digital software must retain these records and must be able to send quarterly updates to HMRC without the need for manual entry. This requirement aims to reduce errors and create a clear audit trail for each taxpayer. HMRC has also published a revised list of software products that meet the Making Tax Digital requirements. Taxpayers are encouraged to review this list and choose a product that is suitable for their business size and complexity. Early selection means there is more time to learn the system and avoid difficulties when quarterly reporting begins. How it impacts you For sole traders these changes affect how the business operates day to day. Digital record keeping will require information to be updated more consistently. This promotes better financial awareness and helps individuals understand their tax position long before the end of the tax year. It also reduces errors that often arise when records are updated only once a year. Landlords will also experience a shift. Under Making Tax Digital a separate digital record must be kept for each property. This means rental income, repairs, maintenance costs and letting fees must be recorded clearly for each individual property. Landlords with several properties will benefit from software that can organise information in a structured and reliable way. Company directors who file Self Assessment returns will also be brought into the system if they have property income or self employment income that exceeds the thresholds. Although company income is not within the scope of MTD for Income Tax, any personal income streams will be affected. Those who join the pilot early will gain practical experience with quarterly reporting. This reduces uncertainty and provides a chance to correct processes before the rules become mandatory. The pilot also allows taxpayers to check whether their software, record keeping and bank feeds perform correctly. What you can do Start by reviewing your current bookkeeping method. If you use spreadsheets or paper records it is sensible to begin exploring software. A digital system will become essential for compliance. Choosing software early ensures you can move at your own pace rather than rushing closer to the deadline. Next, review whether you are eligible for the Making Tax Digital pilot. Joining the pilot is voluntary, but it gives valuable experience and helps reduce pressure when the rules take effect. It also reveals whether your record keeping processes need updating. Begin recording transactions digitally even if you are not yet required to submit quarterly updates. This builds good habits and helps you identify gaps or areas where information is inconsistent. Digital records also provide clearer insights into cashflow and performance throughout the year. Speak with your accountant about how Making Tax Digital affects you. They can help you choose software, import data, set up categories and create routines for digital record keeping. Early preparation is the best approach for a smooth transition. Ledgr Accountants provides guidance and support for clients preparing for Making Tax Digital. We help clients select software, test digital submissions and set up reliable processes that meet HMRC requirements. Thowsif Mukit Commercial Manager References https://www.gov.uk/guidance/use-making-tax-digital-for-income-tax https://www.gov.uk/government/collections/making-tax-digital-for-income-tax https://www.gov.uk/guidance/find-software-thats-compatible-with-making-tax-digital-for-income-tax

Property taxation continues to evolve as the government looks to increase available housing and encourage better use of existing stock. The Autumn Budget brought new powers for local authorities and adjustments that will influence the cost of holding certain properties. These measures focus on empty homes, second homes and the wider use of council tax premiums. By late November, landlords and property investors have begun to assess the impact of these changes. Many investors rely on predictable property costs when forecasting rental income and planning refurbishments. Any change to local taxation therefore has a direct effect on financial planning. Property Tax The Property Tax Update centres on the expansion of council tax premiums and the powers local authorities now have to charge higher rates on empty or rarely used properties. The Autumn Budget confirmed that councils can apply a premium on homes left empty for more than one year. This reduces the previous two year threshold and brings many more properties into scope. The premium can reach up to one hundred percent of the standard council tax bill. This creates a significant cost for owners who leave properties unused for extended periods. Second homes may also face higher charges. Local authorities now have the ability to set premiums on these properties where they are not the owner’s main residence. The aim is to increase the availability of homes in areas where demand is high. Although councils must choose whether to adopt these powers, the expectation is that many will introduce premiums over the next year. The government has also highlighted the need for clearer guidance when properties are improved or converted. This includes how changes to a property can influence its council tax band. Further detail is expected in due course as part of wider efforts to create a more consistent and transparent system. These measures do not alter the income tax rules for rental profits or the existing treatment of mortgage interest. However, they do affect the overall cost of holding residential property. Landlords must now consider whether planned refurbishments, long void periods or seasonal use could increase council tax bills. How it impacts you For landlords, the most immediate impact appears when a property is empty. Renovations, delayed tenant move ins or extended marketing periods may now push a property into the premium category more quickly than before. The shift from a two year threshold to a one year threshold means landlords must be more proactive when managing void periods. Owners of second homes may also experience higher costs. A property used only for holidays or occasional visits could now attract additional council tax charges. This may influence decisions around whether to let the property on a short term basis or to restructure its use to meet qualifying business rates criteria. For investors assessing new purchases, due diligence must include a review of local authority policies. Councils will adopt premiums at different times and at different rates. A property in one area may face significantly higher annual charges than a similar property in a neighbouring region. Understanding this variation is essential for accurate investment forecasting. Higher council tax premiums can reduce net rental income. Landlords must therefore adjust their cashflow projections and take action to ensure that rising costs do not undermine the financial viability of their portfolios. What you can do Begin by reviewing your local council’s policy on empty homes and second homes. Many councils have already published consultation papers that set out planned premium rates and implementation dates. Understanding these timelines helps landlords prepare and make informed financial decisions. If you own an empty property, reassess your refurbishment schedule. Bringing a property back into use earlier may avoid a premium. Even small adjustments to timelines can prevent unnecessary costs. For second home owners, evaluate whether the property meets any criteria for business rates or furnished holiday let classification. These categories have their own requirements and may offer lower council tax costs in some circumstances. Careful planning is essential before making any changes because each classification brings separate tax rules. For investors considering new acquisitions, factor council tax premiums into your long term calculations. The financial impact of higher annual council tax must be included alongside mortgage payments, maintenance costs and expected rental income. At Ledgr Accountants we support landlords and property investors as they navigate these changes. We help clients understand local council policies, assess the tax impact on their portfolios and plan property usage to remain efficient and compliant. Ish Mukit Senior Accountant References https://www.gov.uk/council-tax-bands https://www.gov.uk/council-tax/second-homes-and-empty-properties

The Autumn Budget delivered a series of National Insurance Changes that will shape payroll, personal tax planning and business decisions over the coming year. These changes affect employees, sole traders and company directors. They will begin to influence pay packets and cashflow from early 2026. National Insurance is one of the largest tax costs for many individuals. Even a small change in rates or structure can have a noticeable effect on net income. For businesses these adjustments influence payroll forecasting and cashflow planning. November is therefore an important moment to understand the new rules and to prepare before the changes take effect. National Insurance The National Insurance changes introduced in the Autumn Budget focus on three areas. These are the employee rate, the self employed Class Four rate and the structure of Class Two contributions. Employee National Insurance will fall from the current main rate to a lower rate that the government believes will support working households and encourage earnings growth. This will increase net pay for millions of employees. Directors who take a salary from their limited companies will also see this rise in take home pay. For sole traders the change to Class Four contributions is significant. The main rate of Class Four will reduce. This lowers the overall tax burden on self employed individuals. It also helps those whose income has fluctuated during the year. The role of Class Two contributions is also being updated. Class Two has historically created a flat weekly charge for the self employed in exchange for access to state benefits. The Budget outlines plans to simplify how entitlement is recorded. This aims to reduce confusion and to create a more modern structure. These changes will take effect from April 2026. Although this is several months away, November is an ideal time to begin preparing. With Self Assessment deadlines approaching, understanding these new rules helps individuals plan ahead with clarity. How it impacts you The new rates influence the income of employees, directors and sole traders in different ways. Employees and directors who take a salary will notice an increase in take home pay once payroll systems update to the new rate. The precise amount will depend on earnings but even a small rise can support household budgets during the early part of the new year. For sole traders the reduction in Class Four contributions may ease the combined burden of income tax and National Insurance. It also makes profit planning more predictable. Many self employed individuals will welcome this change as it offers some support during a period of higher living costs. The updated Class Two rules may simplify record keeping for some and will reduce the chance of confusion about state benefit entitlement. Those who currently make manual Class Two payments should pay close attention to the new rules to ensure that their contributions remain accurate. For limited company directors who pay themselves through a mix of salary and dividends the changes may influence the most efficient balance. A lower National Insurance cost on salary may shift the calculation slightly. Reviewing this balance before April ensures the best approach for the next financial year. What you can do Begin by reviewing your expected income for the 2025 to 2026 tax year. If you are employed or take a salary as a director consider how the reduced employee rate will affect your take home pay. This helps with personal budgeting and forecasting. Sole traders should update their profit projections and estimate their new Class Four liability. Doing this early ensures that tax saving strategies such as pension contributions can be considered with greater accuracy. Anyone who currently pays Class Two contributions manually should check their HMRC account during the next few months. This will confirm how the new structure will apply in their specific circumstances. Businesses should make sure that payroll software is ready for the April update. Checking this in advance prevents errors and avoids surprises when running the first payroll of the new tax year. Directors should also discuss with their accountants whether their salary and dividend mix remains optimal under the new rules. At Ledgr Accountants we work with clients to apply these National Insurance Changes in a practical way. We help you understand how the new rules affect your income and what steps to take before the new rates become active. Ish Mukit Senior Accountant References https://www.gov.uk/national-insurance https://www.gov.uk/national-insurance-rates-letters https://www.gov.uk/self-employed-national-insurance-rates

The Autumn Statement sets the tone for tax and spending in the months ahead. By late October the conversation is shaped by fresh public finance numbers and analysis from independent forecasters. Borrowing has improved compared with last year, yet the stock of public debt remains elevated. That mix suggests limited fiscal room and a focus on targeted measures rather than sweeping changes. Autumn Statement Preview The Autumn Statement Preview begins with pensions. Discussion this month has centred on whether the government could reshape pension reliefs or the way tax free cash is treated. The driver is the need to raise revenue without broad rate rises. Independent analysis emphasises that restricting higher rate pension relief would raise substantial sums, though it carries fairness and behavioural trade offs. Readers should expect careful language here rather than abrupt change, and should review current contribution plans in case allowances or access rules are refined. Property taxation is also in focus. Coverage this month highlighted the idea of higher council tax bands for expensive homes as a relatively simple lever compared with more disruptive options. That would not touch headline income tax rates yet could still raise material revenue. For homeowners and landlords the practical issue is cashflow and valuations. The sensible step now is to understand local banding and model the impact of any uplift on household budgets or rental yields. A third theme concerns the balance between income tax and National Insurance. With headline rate rises ruled out in many briefings, attention turns to threshold freezes and possible rebalancing between taxes on earnings and other income. Think tanks note that small changes to wage and tax assumptions can move the public finances a long way. The implication for individuals is to keep an eye on allowances and effective marginal rates, since adjustments to thresholds can change take home pay even when rates stay the same. Finally there is business taxation. Commentary in October stresses pressure points such as business rates and the treatment of reliefs, while also noting political commitments that constrain headline rate increases. For owners and directors the key is predictability. Forward plans should allow for modest relief changes or targeted base broadening rather than dramatic shifts in the main rates. Cashflow and investment appraisals should be tested against that more restrained outlook. Taken together these four themes point to a measured Statement. Public finances set a cautious backdrop. Targeted adjustments are more likely than wholesale reform. The wise approach is to prepare for small calibrations that still matter at the household and business level. How it impacts you Households face two immediate questions. First, how would a change in pension reliefs or access rules alter the value of planned contributions or withdrawals. Second, how would any property tax tweaks affect monthly budgets. It is sensible to review contributions, check current pension allowances, and look at local council tax banding. Those steps make it easier to move quickly if the Statement introduces refinements. Small businesses and contractors should plan for stability with selective changes. If reliefs are tightened or business rates are adjusted, the impact arrives through cashflow. That argues for updated forecasts and headroom in working capital. Directors should also track any moves that change the balance between salary, dividends and employer pension contributions, since even minor tweaks can shift the most efficient mix. What you can do Start with a calm audit. List upcoming financial decisions that could be sensitive to small rule changes. Pension top ups, dividend timing, bonus decisions and property related outgoings are good examples. Run simple scenarios so you know your range of outcomes. Next, tidy records. Clear, up to date digital bookkeeping makes it easy to react when rules are clarified. It also reduces the chance of errors as deadlines approach. Finally, set a review point. When the Autumn Statement is published, revisit plans within a few days. Most adjustments are manageable when they are anticipated. At Ledgr Accountants we will translate the Statement into practical steps for households, landlords and small firms so you can adjust with confidence. Thowsif Mukit Commercial Manager References   https://www.grantthornton.co.uk/insights/autumn-budget-2025/autumn-budget-2025-what-to-expect https://www.ft.com/content/8fce8947-a283-45cc-a31c-bdd4a2daeef3 https://ifs.org.uk/publications/options-tax-increases https://www.ons.gov.uk/economy/governmentpublicsectorandtaxes/publicsectorfinance

As autumn draws to a close, so does the window for easy preparation. From October onwards, HMRC sends thousands of reminders about the upcoming Self Assessment deadline. The filing cut-off for the 2024–25 tax year is 31 January 2026, but waiting until January to start increases the risk of missing details or rushing through errors. By the end of October, most businesses have already received all their income information, bank statements, and expense data for the previous year. Starting now gives you time to review records, claim allowable expenses, and confirm that everything is accurate before submission. Self Assessment Preparation Self Assessment Preparation is not only about filling in forms. It starts with understanding what HMRC expects and what information you need to provide. If you are self-employed, you will need records of your business income, expenses, and any other taxable income such as interest, dividends, or property rent. Landlords should review rental income statements, letting agent fees, maintenance costs, and mortgage interest. Directors or shareholders must include dividends, salary, and benefits in kind. HMRC requires all figures to be backed by evidence, so accurate record-keeping is essential. Receipts, invoices, and digital copies of bank statements should be stored securely for at least five years after filing. Many clients now use accounting software that automatically tracks income and expenses, making it easier to identify deductions. The main reason for preparing in October is time. Filing early gives you a clear view of your tax liability. If you owe money, you can budget for it rather than face a large unexpected bill in January. If you are due a refund, you will receive it sooner. How it impacts you Preparing your Self Assessment early has practical benefits. It reduces stress, improves accuracy, and allows you to plan ahead. Late filings or mistakes can lead to penalties and interest charges, which are completely avoidable with forward planning. For sole traders, this process provides an overview of how your business performed last year. It helps identify spending patterns, missed expenses, and opportunities for better tax efficiency. Landlords benefit from the same insight, using their records to understand which properties generate the best returns and where costs can be controlled. Company directors who receive dividends or have multiple income sources can also plan more effectively. By reviewing tax liabilities now, you can decide whether to adjust your income strategy or make pension contributions before the current tax year ends in April. Starting early also helps your accountant. It gives them time to review and file everything properly without a rush. Working with your accountant now avoids the January bottleneck and ensures that questions are answered while you still have time to act. What you can do Start by gathering all relevant documents for the 2024–25 tax year. This includes: Income statements and invoices Bank statements and proof of expenses Employment records such as P60s or P45s Pension contribution statements Mortgage interest summaries for landlords Dividend vouchers for company shareholders Once these are collected, check that your details on the HMRC portal are up to date. Ensure your National Insurance number, business address, and bank details are correct. If you use accounting software, reconcile all transactions and review your reports for missing entries or duplicates. For those still using manual records, this is the time to consider moving to a digital platform, especially with Making Tax Digital (MTD) for Income Tax set to roll out in 2026. Contact your accountant to review your draft figures. They can confirm which expenses are allowable, help you estimate your final tax bill, and submit your return well before the deadline. At Ledgr Accountants, we guide clients through every step of the Self Assessment process. Our goal is simple: clear records, correct figures, and calm filing. Preparing now means no surprises later. Ish Mukit Senior Accountant References https://www.gov.uk/log-in-register-hmrc-online-services https://www.gov.uk/self-assessment-tax-returns/deadlines https://www.gov.uk/self-assessment-tax-returns

By July 2025, HMRC has begun analysing the data submitted since the start of the new tax year. This includes VAT returns, payroll records and quarterly reports. This is a key period when the department identifies anomalies or patterns that warrant closer inspection. It’s an ideal time to ensure everything filed so far in 2025/26 is accurate and consistent. While most businesses will never face a full audit, HMRC investigations can arise from even small discrepancies or late filings, and understanding how they begin is the best way to stay prepared. HMRC Investigations HMRC carries out investigations to make sure that individuals and businesses are reporting the correct amounts of income and tax. These checks can range from routine compliance reviews to more detailed enquiries where records and explanations are required. Common triggers include: Expense claims that seem unusually high compared to industry averages. Differences between VAT, payroll, and Self-Assessment data. Late or missed submissions that flag risk in HMRC’s system. Unexplained changes in turnover or profit. Information from banks, property records or third parties that doesn’t match declared figures. In 2025, HMRC has expanded its use of data analytics and artificial intelligence to spot irregularities faster. Even minor rounding differences can prompt a follow-up if they appear across multiple returns. How it impacts you An HMRC investigation can be disruptive for any business. It often requires detailed explanations of income, expenses and record-keeping practices, sometimes going back several years. The process can delay refunds, pause repayments, and create uncertainty while the review is ongoing. Beyond the administrative strain, investigations can impact reputation and confidence. Suppliers, lenders and clients may become cautious if your accounts are under review, even if everything is above board. There can also be indirect financial effects such as time lost responding to queries, or the cost of professional support if you need representation. However, most enquiries are resolved quickly when businesses have accurate, well-organised records. In many cases, HMRC simply seeks clarification rather than alleging wrongdoing. Being transparent and prepared makes the process much smoother. What you can do The best defence against an HMRC investigation is prevention: Maintain clear records: Keep digital copies of invoices, receipts and bank statements. HMRC requires records to be retained for at least six years. File on time: Submit Self-Assessment, VAT and PAYE returns before deadlines to avoid attention. Be consistent: Ensure figures across all submissions align (e.g. income tax, VAT and payroll). Avoid inflated claims: Only claim business expenses that are fully and exclusively for business use. Review regularly: Carry out quarterly reviews with your accountant to correct errors before HMRC spots them. If HMRC does contact you, respond promptly and professionally. Most enquiries can be resolved quickly with good communication and proper documentation. At Ledgr Accountants, we support clients through every step - from proactive compliance to managing correspondence. Our aim is to make even complex situations stress-free, transparent, and manageable. Ish Mukit Senior Accountant References https://www.gov.uk/tax-appeals/overview https://commonslibrary.parliament.uk/research-briefings/sn05262/ https://www.gov.uk/tax-compliance-checks https://www.gov.uk/government/publications/general-information-about-compliance-checks-ccfs1a/about-compliance-checks-ccfs1a

By the end of June, many small businesses and sole traders are six months into their accounting year. It’s the point when forecasts can be compared to actual performance, and when adjustments can prevent small issues from turning into bigger problems later on. A mid-year check is not about reinventing the wheel. It’s about reviewing profit forecasts, keeping VAT compliance on track, and ensuring that cashflow is healthy enough to sustain growth and cover upcoming tax obligations. Mid-Year Checks Reviewing year-to-date figures against your original business plan highlights whether profits are on track. If income is higher, this could mean larger tax liabilities and more planning opportunities. If lower, it’s a chance to adjust spending, renegotiate contracts, or explore new revenue streams. Many VAT-registered businesses will have their quarterly VAT return and payment due by 7 June 2025 (covering periods ending 30 April). Staying on top of VAT is crucial, especially for those close to the registration threshold or facing cashflow strain from paying VAT before receiving customer payments. Summer is a pressure point for cashflow. For many businesses, staff holidays or slower demand can reduce income temporarily. At the same time, July’s Self-Assessment second payment on account (31 July 2025) looms, which can create additional pressure. A mid-year review ensures businesses plan liquidity around these pinch points. How it impacts you For sole traders, mid-year reviews provide clarity on how much tax to set aside ahead of the July and January Self-Assessment deadlines. A surprise tax bill is often the biggest source of stress and checking now removes that uncertainty. Small businesses need to ensure their VAT obligations are under control. Late submissions or payments can attract penalties and interest, so mapping out due dates is vital. Property owners with mixed income sources should also review cashflow, as tax liabilities may be larger than expected if rental income has risen. Contractors benefit from knowing how profit is trending. If contracts have been strong, setting aside additional funds for tax now avoids difficulty later. If work has been slower, a mid-year review can help recalibrate budgets and ensure spending is sustainable. What you can do If you filed your April VAT return in early June, use the data to refine forecasts for future quarters. For those nearing the VAT threshold, monitor turnover closely to avoid accidental non-compliance. Compare your profit and loss to forecasts, and update tax projections for 2025/26. Factor in seasonal slowdowns and prepare for the 31 July 2025 Self-Assessment payment on account. Building this into your forecast avoids last-minute shortfalls. At Ledgr Accountants, we help clients turn these mid-year reviews into clear action plans by adjusting tax strategies, ensuring VAT compliance, and strengthening cashflow planning. Ish Mukit Senior Accountant References https://www.gov.uk/self-assessment-tax-returns/deadlines https://www.gov.uk/understand-self-assessment-bill/payments-on-account https://www.gov.uk/submit-vat-return

By the end of May 2025, the effects of the Spring Budget are beginning to be felt across the UK. The announcements made earlier in the spring have already shaped the tax year, with new thresholds and rules that came into force from 6 April. But May is not just about reflecting on policy. It is also a month of deadlines and compliance. Employers had until 31 May to provide employees with their P60s, and the calendar is already pointing toward upcoming obligations in June and July. Spring Budget Reaction The Spring Budget confirmed adjustments to income tax and National Insurance thresholds which came into force on 6 April 2025, marking the start of the new tax year. These changes affect take-home pay, employer costs, and overall tax liabilities for the 2025/26 period. Property owners also saw further tightening of capital gains allowances, which applied from April. This means disposals taking place in the 2025/26 year may now attract higher tax charges. Contractors were reminded of HMRC’s renewed focus on employment status, with the updated CEST tool launched on 30 April 2025 to improve clarity around IR35 rules. The Budget also introduced incentives for green and digital investment, which apply to qualifying expenditure incurred from April 2025 onwards. These measures are intended to encourage innovation, though the practical benefits will depend on whether smaller businesses can access the schemes effectively. How it impacts you For sole traders and employees, the income tax and NIC thresholds that took effect from 6 April are already impacting take-home pay. While some will see little difference, others may notice reduced efficiency in how their income is taxed, making planning more important than ever. Employers faced the annual 31 May deadline to provide P60s, a reminder of their year-end obligations to staff. For those running small payrolls, meeting these deadlines is essential to maintaining compliance and avoiding penalties. Contractors now need to navigate the revised CEST tool, in use since 30 April. Status determinations may differ from past results, raising the importance of record-keeping and clear contractual terms. Property owners considering disposals this year must now plan under the new, reduced allowances for capital gains. This could significantly affect net returns, particularly where large gains are involved. Looking ahead, businesses should note that 1 June 2025 is the corporation tax payment deadline for companies with accounting periods ending 31 August 2024, and that the 31 July 2025 second payment on account is fast approaching for those within Self-Assessment. What you can do If you are a sole trader or director, now is the time to review your remuneration strategy in light of the new tax and NIC thresholds. Adjusting the balance between salary, dividends and pensions can help you remain tax-efficient throughout 2025/26. Employers should ensure that P60s were issued by 31 May and check payroll systems to confirm compliance. If any issues remain, addressing them quickly reduces the risk of HMRC penalties. Contractors should retest engagements using the new CEST tool and retain evidence of each determination. Being proactive now can reduce stress later if HMRC challenges your status. Property owners considering disposals should run the numbers with the new capital gains allowance in mind and consider spreading sales across multiple tax years to mitigate liabilities. Finally, plan ahead for the next key dates: corporation tax payments due 1 June 2025 and second Self-Assessment payments due 31 July 2025. Building these into cashflow forecasts now ensures smoother planning and avoids last-minute pressure. At Ledgr Accountants, we guide clients through each of these changes, deadlines and obligations - making compliance manageable and helping you take advantage of planning opportunities as they arise. Ish Mukit Senior Accountant References https://commonslibrary.parliament.uk/research-briefings/cbp-10237 https://www.gov.uk/government/publications/spring-statement-2025-document/spring-statement-2025-html

May 2025 has brought renewed focus on the investment climate in the UK. After a year of inflationary pressures and cautious interest rate policy, businesses are making decisions about whether to expand, reinvest, or hold back. The Spring Budget provided some targeted incentives for growth, but sentiment remains mixed across industries. For many small businesses, contractors, and property owners, the question is not just whether the economy is investing, but how those investments trickle down into opportunities and risks for them. Business Investment Outlook The outlook for 2025 shows a patchwork of momentum. Manufacturing and green energy sectors are continuing to attract capital as the government supports the transition to net zero. Construction and infrastructure are also seeing steady commitments, thanks in part to public-sector spending and long-term projects. By contrast, consumer-facing industries such as retail and hospitality remain cautious. High costs and tighter household budgets have limited reinvestment in these areas, with businesses focusing more on efficiency than on expansion. Professional services and technology are showing resilience, particularly in cloud computing, AI and financial services. Many investors see these areas as engines for productivity gains, making them a safer bet despite broader economic uncertainty. Overall, the UK business investment environment in May 2025 is one of selective growth: certain sectors are thriving, while others continue to weather caution. For small businesses and contractors, the key is to align with areas of opportunity and avoid overextending in sectors where demand may remain soft. How it impacts you For households and sole traders, investment trends determine where opportunities appear. If growth is concentrated in energy, infrastructure and tech, then contractors and freelancers in those areas are more likely to find consistent work. For those in retail or hospitality, conditions may stay challenging, requiring extra focus on cost control and adaptability. Small businesses often rely on a healthy investment climate to access finance and credit. Lenders and investors are more willing to support firms in thriving sectors, while those in weaker markets may face stricter terms. Understanding where confidence lies can help business owners target investment, expansion, or even diversification more effectively. Property owners can also feel the effects. Stronger investment in infrastructure and green energy projects often boosts local demand for housing and rental property, while weaker consumer industries can hold back regional growth. In short, the Business Investment outlook of May 2025 helps you anticipate where opportunities for growth exist, and where caution is still needed. What you can do For small businesses and contractors, the first step is to stay informed about sector-specific trends. If your sector is attracting capital, explore ways to align your services with new demand. For example, tradespeople may find opportunities in green energy installation, while consultants can focus on technology-driven efficiency projects. It is also wise to review financing options early. Businesses operating in growth sectors may benefit from improved access to credit, but even those in slower industries can strengthen their case by preparing strong forecasts and demonstrating resilience. Diversification can also help. Contractors and small firms tied to slower sectors should consider whether their skills or products can be adapted to areas seeing growth. Finally, consider seeking professional advice. At Ledgr Accountants, we help clients interpret macroeconomic shifts, apply them to their unique situation, and make proactive choices that reduce risk while maximising opportunity. Thowsif Mukit Commercial Manager References   https://obr.uk/efo/economic-and-fiscal-outlook-march-2025 https://www.cbi.org.uk/articles/uk-economic-forecast-june-2025 https://www.gov.uk/government/publications/spring-statement-2025-document/spring-statement-2025-html

April 2025 is the start of the new 2025/26 tax year, and as always, changes to allowances and thresholds are coming into effect. For sole traders, contractors, property owners and small businesses, these updates can make the difference between a smooth year of planning or unexpected financial pressure. The new figures affect everything from personal allowances to National Insurance contributions, and they also mark the introduction of new HMRC tools and compliance requirements. New Tax Year Changes From 6 April 2025, direct tax rates and allowances have been updated. This includes adjustments to income tax thresholds, National Insurance bands and dividend allowances, with impacts felt across different income levels. While some changes provide small reliefs, others mean an increased tax burden for higher earners and business owners. Another update to note is HMRC’s planned change to the Check Employment Status for Tax (CEST) tool, due by the end of April. This will affect contractors and businesses engaging with freelancers, especially where IR35 rules apply. The tool’s revisions are designed to reduce ambiguity, but contractors must be cautious in how status is determined, as HMRC continues to tighten compliance checks. These updates highlight the government’s ongoing focus on raising revenue while improving administration and compliance. The detail matters: even small shifts in thresholds can add up significantly over the year. How it impacts you For households and sole traders, changes to personal allowances and NICs directly affect take-home pay. Even small adjustments can alter monthly budgets, so understanding these numbers early in the tax year helps prevent surprises. For small businesses, payroll costs may rise if employer NIC thresholds change, and dividend taxation continues to be a focus. This may reduce how much directors and owners can extract from their companies in a tax-efficient way. Contractors face additional scrutiny with the updated CEST tool. A status determination that shifts them into IR35 can reduce income significantly, while also changing how tax and NICs are reported. Property owners may also find adjustments to capital gains tax allowances and interest relief rules impacting profitability from rental income. What you can do The first step is to review your personal and business budgets with the updated thresholds. Adjust your forecasts so you understand how much income, tax and NICs you’ll be dealing with across the year. For business owners, consider reviewing how you pay yourself - whether through salary, dividends, or a combination - to optimise tax efficiency under the new rules. Contractors should check their engagement terms and use the updated CEST tool carefully, keeping detailed records of any determination. Property owners may need to re-forecast rental income and costs, especially if allowances for expenses or capital gains have shifted. Seeking proactive tax planning advice now can help preserve profitability. At Ledgr Accountants, we make this process simple by walking clients through each update, applying it to their unique situation, and setting out a plan that keeps them compliant and tax-efficient. Ish Mukit Senior Accountant References https://commonslibrary.parliament.uk/research-briefings/cbp-10237 https://www.gov.uk/government/publications/summary-of-tax-update-spring-2025-simplification-administration-and-reform/tax-update-spring-2025-simplification-administration-and-reform-summary

April 2025 marks the start of a new tax year, but the bigger story for most people is the ongoing strain from rising prices. Inflation, while down from its 2022 peaks, continues to sit above the Bank of England’s 2% target. This makes everyday costs higher than expected and puts pressure on families and businesses trying to plan ahead. Understanding the UK’s current inflation outlook is key to preparing for the months ahead. Inflation Outlook Recent data shows inflation averaging around 3–3.5% this spring. Energy prices remain a key driver, with adjustments to the April energy cap adding to household bills. Rents and housing costs continue to climb, and wage growth in several sectors is feeding into higher service prices. The Office for Budget Responsibility expects inflation to stay elevated through the middle of 2025 before gradually easing in 2026. However, risks remain - including global energy markets, supply chain pressures, and regulated charges such as council tax rising faster than expected. The Bank of England’s stance reflects these uncertainties. Policymakers have signalled that while inflation should fall eventually, they are not yet ready to cut interest rates aggressively. How it impacts you For households, inflation in April 2025 means that essentials such as food, energy and transport continue to take up a larger share of income. Families are finding it harder to put money aside for savings or holidays, as more of their budget is consumed by unavoidable expenses. This creates added financial stress and leaves less flexibility to deal with unexpected costs. For small businesses, inflation presents a double challenge. On one hand, the cost of materials, utilities and staff wages has increased. On the other hand, many business owners are reluctant to pass these costs directly to customers for fear of losing them in a competitive market. This results in shrinking profit margins and forces many to rethink their pricing strategies and efficiency measures. Contractors and freelancers are particularly exposed. Their income often fluctuates from month to month, making it difficult to cope with consistently higher living costs. When everyday expenses climb but income remains unpredictable, financial planning becomes far more difficult. Borrowers and mortgage-holders also feel the strain. Because interest rates are being kept higher for longer in order to tackle inflation, monthly repayments on loans, mortgages and overdrafts remain elevated. This makes it more expensive to borrow money for both personal and business purposes, adding to the financial squeeze. Even savers are not immune. If the interest paid on savings accounts lags behind inflation, the real value of money held in cash falls over time. While balances may appear to be growing, purchasing power quietly declines, making it harder to achieve long-term goals such as retirement planning or property investment. What you can do The most effective step households and businesses can take in the current environment is to budget with realism. By recognising that essentials will continue to cost more, you can adjust spending habits now and avoid financial surprises later in the year. For families, this may mean trimming discretionary spending and setting aside a small emergency buffer to absorb higher bills. Small businesses should consider strategic pricing reviews. Instead of large, sudden increases, gradual adjustments paired with transparent communication to customers can help maintain trust while preserving margins. Businesses can also review supplier contracts, renegotiate terms, or explore new suppliers who may offer better value. Fixing costs where possible is another practical move. For example, securing a fixed-rate energy or finance deal provides certainty and shields you from potential future rises. Similarly, reviewing borrowing structures - such as switching from a variable loan to a fixed-rate arrangement - can reduce exposure to further rate hikes. Savers should look to optimise returns by moving money into higher-yield accounts or tax-efficient products such as ISAs. Even a small increase in interest can help offset the erosion caused by inflation. For those with investment portfolios, considering a reallocation towards inflation-linked assets may also help protect long-term value. Finally, it is important to stay informed and seek advice. Inflation is volatile and forecasts can shift quickly. At Ledgr Accountants, we work with clients to forecast cashflow under different inflation scenarios, stress-test financial plans, and identify practical steps tailored to their circumstances. The goal is to reduce uncertainty and give clients confidence, even when the economic backdrop is challenging. Thowsif Mukit Commercial Manager References   https://www.bankofengland.co.uk/monetary-policy-report/2025/february-2025 https://obr.uk/forecasts-in-depth/the-economy-forecast/inflation https://www.gov.uk/government/statistics/council-tax-levels-set-by-local-authorities-in-england-2025-to-2026