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

The government’s Making Tax Digital (MTD) initiative is reshaping how the UK’s self-employed and landlords report income. The system aims to make tax administration more accurate, more efficient, and easier for everyone to manage. From April 2026, the first group of taxpayers will be required to keep digital records and send quarterly submissions through compatible software instead of a single annual return. By September 2025, this shift is no longer on the horizon as it is close enough to plan for. HMRC continues to expand the pilot programme, allowing early joiners to test submissions before full rollout. Many small businesses and landlords are using this time to review bookkeeping processes, select software, and begin digitising their financial records. Making Tax Digital (MTD) The MTD for Income Tax Self Assessment (ITSA) rules apply to individuals with total business and property income above £50,000 from April 2026. A second phase, covering those earning between £30,000 and £50,000, will follow in April 2027. Under this new system, taxpayers must maintain digital records of their income and expenses. They must also submit quarterly updates to HMRC using MTD-compatible software. These submissions will replace the annual Self Assessment return for those within scope. According to HMRC’s guidance updated in September 2025, the pilot programme remains open to eligible participants. Volunteers who sign up early can test digital submissions and ensure their systems meet the technical requirements. HMRC lists approved software providers that integrate directly with its systems, including options for both individuals and agents. The aim of MTD is to improve accuracy and reduce errors in reporting. By collecting data throughout the year, taxpayers will have a clearer picture of their liabilities and fewer surprises at year-end. This steady flow of information also allows HMRC to identify discrepancies earlier, making the entire system more transparent. How it impacts you The impact of Making Tax Digital will depend on how you currently manage your records. For those already using cloud-based accounting software, the transition may feel natural. Your existing system might already meet MTD standards or only need minor adjustments. For others still relying on spreadsheets or manual methods, this is the time to upgrade. Quarterly reporting will bring a new rhythm to financial management. Instead of gathering documents once a year, businesses will maintain regular digital updates. This encourages more consistent oversight of income, expenses, and tax estimates. For many clients, that means better budgeting and fewer unexpected tax bills. Landlords with multiple properties may benefit most from the digital approach. Tracking rental income, repair costs, and mortgage interest through one platform reduces errors and simplifies year-end reconciliation. For sole traders and contractors, submitting quarterly figures also means easier cashflow forecasting and more accurate profit tracking throughout the year. MTD for ITSA will not change how much tax is owed, but it will change how information is delivered. Those who prepare early will find the process less disruptive and will benefit from stronger record-keeping in the long term. What you can do Start by checking whether your total business or property income exceeds £50,000. If it does, you will be required to join MTD from April 2026. Even if you fall below this level, it is worth preparing now, as the scope will widen in 2027. Next, review your bookkeeping setup. If you currently use spreadsheets, consider switching to MTD-compatible software. HMRC maintains a list of approved providers that connect directly to its systems. Cloud-based solutions such as Xero, QuickBooks, and FreeAgent allow you to record transactions, store receipts, and generate reports automatically. If you are eligible, consider joining the MTD pilot scheme before the end of the year. Doing so gives you time to learn the process, test submissions, and resolve any technical issues before the system becomes mandatory. Early participation also helps identify any workflow changes needed within your business. Keep in mind that digital compliance requires consistent habits. Upload receipts regularly, reconcile bank transactions monthly, and review your accounts quarterly. This level of organisation not only ensures compliance but also provides more accurate insight into your financial position. At Ledgr Accountants, we help clients set up MTD-compatible systems, train teams to use them effectively, and monitor submissions throughout the year. Preparing now means you can move into the new system confidently, with reliable data and complete peace of mind. Ish Mukit Senior Accountant References https://www.gov.uk/guidance/use-making-tax-digital-for-income-tax https://www.gov.uk/guidance/sign-up-your-business-for-making-tax-digital-for-income-tax

By September 2025, the UK’s Public Finances remain under close scrutiny. The latest data from the Office for National Statistics (ONS) show that government borrowing has eased slightly compared with the same period last year, but the overall picture is still tight. Public sector net borrowing for August 2025 was around £12 billion, down from the previous year’s £13.5 billion. Total public debt remains above 95 percent of GDP, showing how little room there is for large spending increases or tax cuts ahead of the Autumn Statement. Debt interest costs have also stayed elevated due to the higher base rate and inflation-linked bond payments. This continues to limit how much flexibility the Treasury has when planning its budgets. As the government approaches its mid-year review, the balance between keeping borrowing under control and supporting the economy remains delicate. Public Finances The Public Finances update from the ONS confirms that the government has borrowed less than forecast for the first five months of the 2025–26 financial year. The improvement is largely due to higher tax receipts and moderate spending restraint. Income tax and corporation tax receipts have risen as wages and profits hold steady, but spending on welfare and debt servicing remains heavy. The Office for Budget Responsibility (OBR) has noted in its September commentary that the outlook for the remainder of the year remains challenging. Even though borrowing is lower than last year, it is still above pre-pandemic levels. The OBR’s latest projections suggest that the Chancellor has only limited fiscal headroom ahead of the Autumn Statement, meaning that significant tax cuts are unlikely. Debt interest costs alone are now absorbing more than eight percent of total government revenues which is a record in modern times. Meanwhile, the HM Treasury public finances bulletin reiterates that departmental budgets are feeling the squeeze from inflation. Although price pressures have eased from their 2023 highs, the cost of delivering public services has risen faster than planned. The Treasury has urged departments to prioritise productivity and savings to help meet spending targets. Investment continues to focus on infrastructure, green energy, and digital transformation projects that are expected to support longer-term growth. Taken together, these sources show a mixed fiscal landscape. Borrowing is improving, but debt is high, interest payments are heavy, and economic growth remains subdued. The government’s challenge over the next six months will be maintaining fiscal discipline while finding space for measures that encourage business confidence and investment. How it impacts you For households and business owners, the government’s approach to its Public Finances has direct consequences. A cautious stance on borrowing means there is less scope for sweeping tax reliefs or new support schemes in the short term. For individuals, that likely means steady personal tax thresholds and continued pressure on disposable income as inflation and interest rates remain elevated. For small businesses, tighter public spending can lead to slower payment cycles on government contracts and fewer new projects commissioned through local authorities. However, it also brings a measure of economic stability. Controlling debt helps to prevent sudden policy changes or emergency cuts, allowing firms to plan with more confidence. Contractors, landlords, and self-employed individuals will also watch the fiscal situation closely. The Chancellor’s decision on whether to prioritise growth incentives or deficit reduction in the Autumn Statement will influence tax planning, investment appetite, and consumer demand for the remainder of the year. What you can do Understanding the broader fiscal picture is useful for both short-term decisions and long-term planning. For businesses, now is the right time to review budgets, cashflow forecasts, and investment plans ahead of the Autumn Statement. If borrowing remains restrained, government policy is unlikely to deliver major tax changes before the end of the tax year, which makes this a good moment to strengthen balance sheets and reduce unnecessary costs. Individuals should continue planning around existing allowances and thresholds. Reviewing pension contributions, ISA savings, and dividend strategies before April 2026 ensures that you are using the current system to its full advantage. For landlords and contractors, it is sensible to keep digital records up to date, as HMRC’s focus on real-time data and compliance continues to grow. At Ledgr Accountants, we help clients interpret these macroeconomic signals and apply them practically. Whether you are forecasting for your business or managing personal finances, staying informed about the state of the UK’s Public Finances provides the context for smarter, more proactive decisions. Thowsif Mukit Commercial Manager References   https://www.ons.gov.uk/economy/governmentpublicsectorandtaxes/publicsectorfinance/bulletins/publicsectorfinances/august2025 https://assets.publishing.service.gov.uk/media/6874fa6f92691289bdb7d393/Public_Expenditure_Statistical_Analyses_2025.pdf https://obr.uk/docs/dlm_uploads/August-PSF-commentary.pdf

The summer of 2025 has brought a quieter rhythm to consumer lending across the UK. After two years of steady borrowing growth, the latest Bank of England figures reveal that households are becoming more cautious. The number of new credit card and loan applications fell again in July, marking the fourth consecutive monthly decline. This shift reflects not only tighter lending conditions but also the lingering impact of higher living costs. For small businesses and individuals alike, borrowing decisions now require more consideration than ever. Many households are focusing on repaying existing debt rather than taking on new credit. Meanwhile, higher interest rates continue to limit affordability, affecting both personal and business finance. Consumer Borrowing Trends The Consumer Borrowing Trends taking shape this summer tell a clear story of caution and restraint. Households are borrowing less, saving what they can, and focusing on paying down existing debt as the cost of credit remains high. The Bank of England’s Money and Credit report for July 2025, published in early August, shows that annual growth in consumer credit has slowed further to just over five percent. This marks one of the weakest readings since 2022. Lenders are reporting fewer applications for personal loans and new credit cards. Higher interest rates continue to discourage borrowing, with average rates for personal loans still around nine percent and credit card rates above twenty-three percent. Many households are also finding it harder to qualify for new credit, as banks apply tighter affordability checks to reflect the ongoing economic uncertainty. The ONS Quarterly National Accounts for April to June 2025 reveal that household savings have fallen slightly as living costs remain stubbornly high. The average saving ratio now sits just above six percent, down from the first quarter of the year. This suggests that families are relying more heavily on disposable income to cover essential spending and have less capacity to build financial buffers. Meanwhile, the HM Treasury Forecasts for the UK Economy, August 2025, highlight how this tightening in credit conditions is expected to slow consumer spending through the rest of the year. Although inflation has eased from its previous peaks, the lagging effects of higher rates are now visible in softer retail activity and lower household confidence. Together, these indicators point to a cautious period ahead, where consumers continue to prioritise stability over new borrowing. How it impacts you The current borrowing climate has a direct effect on everyday life. For individuals, the cost of credit has made large purchases less affordable. Buying a car, renovating a property or funding home improvements now requires higher monthly repayments, which can stretch household budgets. Even small borrowing decisions such as using a credit card to cover short-term gaps feel riskier in an environment where rates and charges are high. For business owners and contractors, personal borrowing often overlaps with business cashflow. Many use personal credit or savings to fund short-term expenses or investment. With borrowing costs rising, this approach has become less sustainable. It also highlights the importance of separating business and personal finances, ensuring each side is supported by clear records and proper planning. The cautious mood also affects demand for goods and services. As consumers reduce discretionary spending, smaller firms in retail, hospitality and trades may notice slower sales or delayed payments from customers. Recognising these trends early helps business owners adapt pricing, manage credit terms and plan for potential slowdowns in the months ahead. What you can do The best response to the current borrowing climate is to take stock. Review all existing credit agreements, from mortgages and personal loans to credit cards and overdrafts. Check whether your interest rates are fixed or variable, and understand when any promotional or discounted periods expire. Knowing these details helps you avoid surprises later. For households, aim to prioritise repayment of the most expensive debt first. High-rate credit cards and overdrafts erode disposable income quickly, and clearing them delivers immediate benefits. Even small overpayments can shorten repayment terms and reduce total interest paid. For business owners, reassessing financing structures is essential. Explore whether short-term borrowing can be refinanced into longer-term arrangements at more manageable rates. Maintaining accurate cashflow forecasts helps identify pressure points early. If customers are taking longer to pay, plan accordingly and review payment terms to protect liquidity. Finally, don’t face financial uncertainty alone. At Ledgr Accountants, we work with clients to build tailored cashflow and debt management plans. Understanding how broader borrowing trends affect your circumstances allows for better decision-making, whether you’re saving for growth or simply keeping things steady through the rest of 2025. Thowsif Mukit Commercial Manager References   https://www.ons.gov.uk/economy/grossdomesticproductgdp/bulletins/quarterlynationalaccounts/apriltojune2025 https://www.bankofengland.co.uk/statistics/money-and-credit/2025/july-2025 https://www.gov.uk/government/statistics/forecasts-for-the-uk-economy-august-2025

As the summer months settle in, many people take the opportunity to pause and reflect on their finances. For those running small businesses or working as sole traders, August can be an ideal time to look at pension contributions. The first quarter of the 2025/26 tax year has passed, but there is still plenty of time to plan ahead. A well-timed pension contribution can make a real difference to your overall tax position. It reduces taxable income, supports your retirement goals and can improve cashflow planning for the remainder of the financial year. Many clients use this point in the year to check whether their existing payments are on track with their income and profit forecasts. Pensions Contributions Pension contributions remain one of the most effective ways to reduce your tax bill while planning for the future. For the 2025/26 tax year, the annual allowance is £60,000 or 100% of your earnings, whichever is lower. Contributions within this limit qualify for tax relief at your marginal rate. Higher-rate and additional-rate taxpayers receive relief through Self Assessment, while basic-rate relief is added automatically by pension providers. For company directors and business owners, there is a further opportunity to make employer contributions through the company. These payments are usually deductible as a business expense, reducing Corporation Tax liabilities. To qualify, the contributions must be wholly and exclusively for the purposes of the business, meaning they should be reasonable and consistent with the size and profitability of the company. Sole traders and contractors can also benefit by contributing personally into a private pension or self-invested personal pension (SIPP). Even modest monthly payments can grow significantly over time, especially when combined with tax relief. Reviewing contributions mid-year makes it easier to adjust future payments rather than trying to catch up later. How it impacts you The impact of pension contributions goes far beyond retirement savings. For individuals, contributions directly lower taxable income, which may reduce exposure to higher tax bands or preserve allowances that are withdrawn as income rises. For example, those earning between £100,000 and £125,140 can use pension payments to bring income back below the threshold where the personal allowance begins to taper away. For company directors, pension contributions offer one of the most efficient ways to extract profits. Rather than drawing additional salary or dividends, a pension payment can provide long-term benefit while lowering the immediate tax burden. It is also a legitimate way to reward yourself for your efforts without increasing payroll costs. For many people, August is a good time to check progress. Income from the first few months of the tax year provides a reliable guide to what total earnings might look like. Using that data, you can decide whether your pension payments are on track or whether there is scope to add more before the financial year closes. This mid-year awareness often prevents the last-minute rush that leads to hasty and less strategic decisions in March. What you can do Start by reviewing your income and profit forecasts for the 2025/26 tax year. Once you have a clear picture, check how much of your annual allowance has already been used. If you are a company director, speak with your accountant about making employer contributions from the business rather than personal funds, as this can offer additional savings. If your earnings fluctuate, consider spreading contributions over several months rather than making one large payment at the end of the year. Regular payments help smooth cashflow and make it easier to manage both business and personal finances. Those who have not yet used their carry forward allowances from the past three tax years may also have scope to make larger payments without breaching limits. Reviewing these figures now ensures that no allowance is lost when the new financial year begins in April 2026. Finally, make sure that your pension provider and accountant are aligned. Keeping both informed means tax relief is claimed correctly and no payments are missed from the accounts. At Ledgr Accountants, we help clients plan contributions in a way that fits both personal goals and business strategy. It is a simple step that delivers long-term financial clarity. Ish Mukit Senior Accountant References https://www.gov.uk/tax-on-your-private-pension/annual-allowance https://www.gov.uk/workplace-pensions https://www.gov.uk/tax-on-your-private-pension/pension-tax-relief