5th December 2025 – Hillmans Weekly Update

Welcome to our latest round-up of the latest business and tax news for our clients. Please contact us if you want to talk about how these updates affect you. We are here to support you!

Have a great weekend.

Kind regards,
 
Steve
 
Steven Hillman BSc (Hons) FCA
Chartered Accountant
Tel: 01934 444100
https://www.hillmans.co.uk

Dividend Tax Rates Rising in April 2026: What Does It Mean for Profit Extraction?
The recent Budget confirmed that dividend tax rates will increase from April 2026. The ordinary and upper rates of dividend tax will both rise by 2%.

For many small and medium-sized companies, dividends are central to how owners pay themselves. With the tax rates rising, your pay and profit extraction strategies will likely need a fresh look for 2026/27.

What’s Actually Changing
From April 2026:

• The dividend ordinary tax rate increases from 8.75% to 10.75%.
• The dividend upper tax rate rises from 33.75% to 35.75%.
• The dividend additional tax rate remains at 39.35%.
• The tax-free dividend allowance remains at £500

The rate you pay on your dividends will depend on the amount of your total income and the source of your income. These rates apply only to dividends - salary, bonuses and savings are taxed differently.

What the Changes Mean for Profit Extraction
As dividends have usually offered a tax advantage over salary, many directors/shareholders adopt a mix of a low salary and higher dividend income.

However, with dividend tax rising, the balance is shifting slightly. The best extraction strategy for one director may look quite different for another, especially when factors like income levels, other earnings, pensions and company profits are taken into account.

It may therefore be worth reviewing:

• Whether a different mix of salary and dividends is now more efficient for you.
• Bringing forward dividends before April 2026, where appropriate.
• The impact on cash flow if you switch to taking a larger salary instead of dividends.

If you want to review how you take money from your company, or see how the upcoming dividend tax changes could affect your take-home pay, get in touch.

We can guide you through the options and help you make sure your remuneration is as tax-efficient as possible.
 
Chancellor Confirms 2% Inflation Target for Next 12 Months
The Chancellor has formally written to the Bank of England’s Monetary Policy Committee (MPC) to reconfirm the UK’s inflation target at 2% for the next 12 months, as measured by the Consumer Prices Index (CPI).

The letter notes that inflation has fallen significantly from its October 2022 peak of 11.1%, and underlying inflationary pressures continue to ease. The Chancellor also highlighted that measures announced at the recent Budget are expected to further reduce inflation by around 0.4 percentage points in 2026-27.

Overall, while the confirmation of the target for the MPC is largely status quo, it does provide clarity for businesses and financial markets.

Whether the Budget announcements will achieve the desired decrease the Chancellor hopes for remains to be seen. However, the expectation is that inflation will ease and the Bank of England base rate will continue to reduce over the next 12 months, with many considering a rate cut later in December a possibility.

See: https://www.gov.uk/government/publications/monetary-policy-remit-budget-2025
 
High-Value Council Tax Surcharge: Next Steps
The government has announced plans to introduce a new levy, the High-Value Council Tax Surcharge (HVCTS), for owners of residential properties in England valued at £2 million or more.

The surcharge is expected to come into effect in April 2028. A public consultation on the details will be held in early 2026.

HVCTS currently only affects residential properties in England. Whether the devolved administrations in Scotland, Wales and Northern Ireland will follow suit remains to be seen.

Not Based on Council Tax Bands
In information published following the Budget, the government confirmed that the surcharge will not be calculated based on council tax bands. So, if your property is currently in say bands F, G, or H (which were set based on 1991 values), this does not necessarily mean your property will be subject to a surcharge.

Instead, there will be a fresh valuation process. The Valuation Office Agency (VOA) will carry out a targeted valuation exercise in 2026. Properties assessed at £2 million or more will be slotted into one of four new HVCTS bands.

As far as council tax is concerned, existing council tax bands will remain in place, and a change in council tax band will not affect HVCTS eligibility.

What to Do Next
Especially if you own a property in London or other high-value areas in England, the new surcharge will be a concern.

• The surcharge could add a significant recurring cost from 2028. 
• As the surcharge uses up-to-date property valuations (not 1991 values), properties that escaped high “band” classification under the old system could now be subject to it if their current market value is high.

If you have concerns about how the new surcharge will affect your situation, please do get in touch. We would be happy to provide you with personalised advice.

See: https://www.gov.uk/government/news/high-value-council-tax-surcharge
 
Seafood Industry Urged to Prepare for New EU Traceability Rules
With just a few weeks remaining until new EU import rules on traceability come into force, businesses involved in the seafood industry are being encouraged to prepare now.

The changes come into force on 10 January 2026, and will affect anyone involved in catching, buying, processing and selling fish destined for EU markets. Without the additional information needed for the Fish Export Service (FES), it will not be possible to export fish and seafood products.

What’s Changing
From 10 January 2026, if you export seafood products that have been caught by a UK vessel and processed in the UK after landing, the consignment will require both a catch certificate for the landed weight that is being exported and a processing statement referencing that catch certificate.

Additional information will be needed to complete these documents. The government is currently updating the Fish Export Service (FES) to ensure that the IT system can provide the enhanced processing statements, catch certificates and other documentation that the EU will require.

How to prepare
The Fish, Trace, Ship campaign website contains detailed information on the new requirements and guidance on how to be ready for them.

The government is also running a series of webinars to help businesses in the seafood industry prepare for the changes. The next sessions are being held on 10 and 17 December 2025.

To register and attend, see the Fish, Trace, Ship campaign website.

A newsletter is also available for sign up here.

See: https://www.gov.uk/government/news/major-changes-coming-for-the-1bn-scottish-seafood-exporting-industry
 
Free Food Safety Resources to Help with the Festive Rush
With Christmas approaching, food businesses are looking forward to one of the busiest trading periods of the year.

As part of its ‘Safer Food Means Better Business’ campaign, the FSA is offering free training, checklists and practical guidance to help small and micro businesses stay on top of food safety and hygiene.

Extra Attention at Christmas
The festive season often brings increased pressure to food businesses. Higher demand, expanded menus and the use of temporary or seasonal staff all raise the risk of mistakes - especially around food handling, allergens and hygiene standards.

Even small slip-ups can lead to problems for your business and unnecessary disruption at a time when margins matter most.

Practical Steps to Take
Practical steps to consider at this time of year could include:

• Training seasonal and temporary staff on the basics of food hygiene and allergen management. 
• Reviewing allergen information for Christmas menus, festive specials and buffets to ensure accuracy. 
• Checking that temporary setups, such as stalls at Christmas markets or pop-up events, meet all food safety requirements.

To review the FSA’s guidance for food businesses, see here.
 
Employment Rights Bill: Key Updates on Unfair Dismissal and Worker Protections
The government has recently brought together trade unions and business representatives to discuss the Employment Rights Bill. These talks have led to conclusions that will assist the Bill to reach Royal Assent and allow the changes it proposes to take effect as planned.

Here we summarise the decisions made.

• Unfair dismissal qualifying period reduced: The qualifying period for unfair dismissals will be cut from 24 months to six months. Existing day one protection against discrimination and automatically unfair dismissal will be maintained. 
• Day one rights: It is planned that from April 2026, employees will gain day one rights to sick pay and paternity leave. 
• Fair Work Agency: The government also plans to launch the Fair Work Agency in April 2026. This new body will take on a role in enforcing the rules and providing advice to workers and employers. It will also have strong powers to investigate and take action against businesses that flout the law.

The package of reforms included in the Employment Rights Bill marks a significant shift in employment law. It is well worth keeping up to date with how these changes may affect your business’ policies, contracts, and workplace practices from 2026 onwards.

See: https://www.gov.uk/government/news/an-update-on-the-employment-rights-bill
 
Charity Trustees Gain New Powers for Moral Payments
Charity trustees in England and Wales now have new legal powers when considering moral payments: payments made because there is a moral rather than strictly legal obligation to transfer some of a charity’s property.

This is the final provision in Charities Act 2022 to come into effect.

Few charities encounter situations where a moral payment is relevant. Typically, these arise in cases involving legacies where there is evidence that a person’s will does not reflect their final wishes.

Key Changes to Moral Payments
The Charity Commission has updated its guidance to help trustees navigate these changes. The main changes, which came into force on 27 November 2025, are:

• Objective legal test: Previously, trustees needed to personally feel a moral obligation (a subjective test). The law now requires an objective assessment -of whether trustees can reasonably be seen as being under a moral obligation. 
• Self-authorisation: Charities may make small moral payments without needing the Commission’s approval, provided they meet certain criteria. 
• Scaled financial limits: The maximum amount a charity can pay without Charity Commission approval is based on the charity’s gross annual income from the previous financial year. Payments above this threshold still require approval. 
• Delegation of decisions: Trustees may delegate moral payment decisions to staff or committees, although they retain ultimate responsibility for the decision.

Practical Implications for Trustees

• The availability of these new powers depends on the individual charity and the proposed payment. Some charities, particularly national museums and galleries, are prevented from making moral payments by their governing document or other legislation. 
• Trustees cannot apply these powers retrospectively. Applications for approval to make a moral payment that have already been submitted will be considered under previous legislation. 
• When necessary, trustees should seek Charity Commission consent. The Commission will continue to evaluate applications on a case-by-case basis, checking that reasonable decisions have been made and legal obligations met.

Commission Guidance
Christine Barker, Head of Regulatory Authority at the Charity Commission, said, “Few charities ever face decisions over ex gratia payments, but for those that do, these legislative changes provide greater clarity and flexibility and allow them to make in-house decisions for small sums. Our updated guidance is designed to help charity trustees know how to apply the law and whether they need to apply for our permission.”

The Charity Commission has encouraged trustees to refer to its general guidance on decision-making (CC27) when considering a moral payment.

See: https://www.gov.uk/government/news/regulator-updates-guidance-after-legislative-changes-on-moral-payments
 
2026 Business Rates Revaluation Completed
If your business is based in England and Wales, you can now view the future rateable value of your property.

The Valuation Office Agency (VOA) has completed updating the rateable values of all commercial and non-domestic properties in England and Wales. The new values take effect from 1 April 2026.

Revaluations happen every three years to reflect changes in the property market, and local councils use these values to calculate business rates bills. A rateable value is not the same as the amount you pay, as your bill depends on the government-set multiplier and any reliefs you may qualify for.

Information on the multiplier rates and reliefs available in England was updated during November’s Budget announcement. The Welsh government is likely to confirm multipliers and reliefs in its January Budget.

Estimate Your Future Bill
You can use the GOV.UK Find a Business Rates Valuation service to find your business property’s future rateable values.

For properties in England, the service can also provide an estimate of your business rates bill, though this won’t account for reliefs. The service for Welsh properties will be updated once the Welsh Government confirms multipliers and reliefs.

If you are facing a bill increase, some of the reliefs announced in the Budget would be worth exploring. These include a Supporting Small Business Scheme and a Transitional Relief scheme.

What to Do Now
You can sign into your business rates valuation account to check your property details, see how the valuation was calculated, and report any errors.

It is also possible to use your account to compare your rateable value with other properties in the area and check how the valuation was calculated.

At the moment, you can only request changes to your current rateable value. You must request any changes to this value by 31 March 2026. After 1 April 2026, you will only be able to make changes to your future rateable value.

If you have concerns about how the revaluation could affect your business’s profitability and budgeting for costs, please get in touch. We would be happy to help you. For any questions you have about rates or payments, contact your local council in the first instance.

See: https://www.gov.uk/government/news/business-rates-revaluation-2026

28th November 2025 – Hillmans Autumn Budget 2025 Update

Welcome to our round-up of the Autumn Budget 2025 for our clients. Please contact us if you want to talk about how these updates affect you. We are here to support you!

Have a great weekend.

Kind regards,
 
Steve
 
Steven Hillman BSc (Hons) FCA
Chartered Accountant
Tel: 01934 444100
https://www.hillmans.co.uk

Autumn Budget 2025: What Does It Mean for Your Business?
After weeks of speculation about what Budget 2025 would contain, the Chancellor was unexpectedly upstaged when the Office for Budget Responsibility (OBR) accidentally published their report revealing key policy measures ahead of the official announcement.

Although the report was quickly withdrawn, the information had already been picked up by media outlets and tax commentators.
Ultimately, however, the manner in which the details were released matters less than the substance of the policies themselves. It is the impact of these measures that will be felt over the coming years.

How does Budget 2025 affect your business? Let’s take a closer look at some of the key points and consider their potential implications.

A Tax Hit for Property Owners and Savers
Budget 2025 announced that, from 6 April 2027, the government will create new separate income tax rates that apply to property income and will increase the rates for these and for the income tax rates on savings income by two percentage points.

The new rates will be as follows:

Basic Rate Taxpayers
            •           Income range: £1 – £37,700
            •           Tax rate: 22% on both property income and savings income

Higher Rate Taxpayers
            •           Income range: £37,701 – £125,140
            •           Tax rate: 42% on both property income and savings income

Additional Rate Taxpayers
            •           Income level: Over £125,140
            •           Tax rate: 47% on both property income and savings income

The new property income tax rates will apply to taxpayers in England and Northern Ireland. The Scottish and Welsh governments will have the power to set property tax rates for those jurisdictions.

Owners of property worth more than £2 million were also affected by the introduction of a high-value council tax surcharge, otherwise known as the ‘mansion tax’. The surcharge will be in addition to the existing council tax and will range from £2,500 to £7,500 depending on the property’s value. Properties will be valued before the introduction of the tax.

If you are a landlord, one or both of these changes could increase your costs. With the abolition of the furnished holiday lettings regime, higher stamp duty land tax on additional properties, the added responsibilities under the Renters Rights Act, and now the prospect of increased tax on property income, it is understandable to question whether continuing to let property remains worthwhile.

If you are concerned, please feel free to contact us. We can provide personalised advice to help you review your options, explore strategies to manage your tax exposure, and identify solutions that work for your individual circumstances.

Increase in Dividend Tax
If you are a company shareholder, from April 2026, the dividends you receive will be subject to higher rates of tax. The basic and higher rates of dividend tax will rise by 2% to 10.75% and 35.75% respectively.

For owner-managed companies, these increased rates raise an important question: do dividends remain a tax-efficient way to extract funds from the business? Those considering incorporating their business will also want to understand how these changes may influence their decisions.

We can provide tailored advice to help you plan effectively, ensuring that you continue to extract income in the most tax-efficient way possible. By reviewing your options in advance, you can make informed decisions that protect your hard-earned income and maximise the benefits of any available reliefs.

Increasing Payroll Costs
Even before the Budget speech, the new national minimum wage rates had been announced. These new rates come into force from 1 April 2026.

We’ve covered the details of the new rates separately, but it’s worth noting the 4.1% increase in the main National Living Wage rate that applies to employees aged 21 and over and the rise of between 6.0% and 8.5% for employees under 21 and apprentices.

Employees who are paid at higher than minimum wage rates may also be looking for comparable increases in their pay. These could mean a fairly substantial uplift in your payroll costs next April. It will be important to ensure that you budget for these costs and take them into account with any recruiting you have in mind over the next year.

Salary Sacrifice for Pension Contributions
If your business offers salary sacrifice for pension contributions, an important change is coming in 2029. At present, all pension contributions made through salary sacrifice are exempt from employer national insurance contributions (NIC), regardless of the amount. This provides valuable savings for both employees and employers.

From 6 April 2029, however, the NIC exemption will be capped at £2,000 per year for employee pension contributions made via salary sacrifice. Any contributions above this threshold will continue to receive income tax relief but will become subject to both employer and employee NICs.
Although this change is still a few years away, it’s worth considering now how it may affect the overall value of your employee pay and benefits packages.

IHT reliefs for business owners and farmers
The government is pressing ahead with plans to reform agricultural property relief (APR) and business property relief (BPR) from 6 April 2026. These are important inheritance tax (IHT) reliefs that currently mean that up to 100% relief is available on the full value of qualifying assets.

As announced in last year’s Budget, from April 2026, this 100% relief will be capped at a combined £1 million of agricultural and business property, with any excess qualifying only for 50% relief.

However, Budget 2025 did provide some good news. It added that, from 6 April 2026, any unused APR or BPR allowance will become transferable to a surviving spouse or civil partner. As a result, couples may be able to pass on up to £3 million of qualifying agricultural or business property free of IHT.

Careful planning is essential, though. Transitional rules mean that gifting assets before 6 April 2026 may not necessarily help the situation. Please speak with us for personalised advice on the best way to organise your estate where business or agricultural assets are involved.

Capital Allowances
For 2026/27, the annual investment allowance (AIA) means that qualifying new capital expenditure you make of up to £1 million can be relieved in full against the taxable profits of your business.

Disappointingly, Budget 2025 announced that the rate of writing down allowance applicable to qualifying capital expenditure that is classed as main rate pool will drop from 18% to 14% on 1 April 2026 for companies and 6 April 2026 for unincorporated businesses, such as sole traders and partnerships.

However, this reduction may be partially offset by a new 40% first year allowance (FYA) that will be available from 1 January 2026. Its usefulness to your business may be limited, though, as it will only really be of benefit where the AIA or other FYAs are unavailable.

If you are considering buying electric vehicles for your business, Budget 2025 confirmed that FYAs that give 100% relief for qualifying expenditure on electric vehicles and charging points will be extended to April 2027.

Business Rates
As announced in the 2024 Budget, two new lower business rates multipliers for eligible retail, hospitality and leisure (RHL) properties with a rateable value (RV) below £500,000 will come into effect from 1 April 2026.

These new multipliers will replace the 40% RHL relief available in 2025/26 and will be funded by introducing a higher multiplier for properties with an RV above £500,000.

Legislation and local authority guidance have already set out the eligibility criteria for RHL properties, but Budget 2025 has now confirmed that each of the new multipliers will be 5p lower than the standard multiplier for a property with the same RV.

Mandated Electronic Invoicing
Following a consultation on the topic, the government plans to make electronic invoicing mandatory for all VAT invoices starting in 2029. A detailed implementation road map is expected to be published next year at Budget 2026.

The possibility of introducing real-time reporting (RTR) is also being considered. This is where invoice information is automatically shared with HMRC, perhaps as soon as it is sent to a customer. However, the government has confirmed that this will not start in 2029. RTR would only be introduced once electronic invoicing is widely in use and well established.

We still have a few years before mandatory electronic invoicing takes effect, and it is always possible that details may evolve as plans develop. However, businesses will need to begin thinking about the practical implications now.

In particular, these changes may influence your choice of accounting software and the pace at which you digitise your invoicing processes. Ensuring that your systems can support structured electronic invoicing formats will make any transition far smoother and minimise disruption once the rules are finalised.

In Conclusion
While Budget 2025 included much talk about growth, tackling inflation and cutting the cost of living, everyone has been asked to contribute. Freezing many income tax rates and thresholds for a further three years and increasing taxes on savings, dividends and property income will mean many end up paying more over the coming years.

It may be necessary to re-examine your business and personal plans for 2026 and beyond to be as tax-efficient as possible. Remember, we are here to support you to ensure your business and personal success. Please do get in touch if there is anything that you would like to discuss.
 
National Minimum Wage Increases Confirmed
The government has announced the new minimum wage rates that will come into force from 1 April 2026.

The new rates are as follows:
Aged 21 and over

• Current rate: £12.21
• New rate: £12.71

Aged 18 to 20

• Current rate: £10.00
• New rate: £10.85

Aged under 18

• Current rate: £7.55
• New rate: £8.00

Apprentice rate

• Current rate: £7.55
• New rate: £8.00

The new rates mean that workers aged 21 and over will get a 4.1% increase. It is estimated that 2.4 million workers will benefit from the rise, with a further 300,000 apprentices and workers aged under 21 being given a rise of between 6.0% and 8.5%.

The larger rise for younger workers is part of the government’s efforts to work towards having a single rate for workers regardless of age.

What should you do about this?
Budgeting for these additional costs from 1 April 2026 will be important, especially if you have plans to hire staff. The earlier you prepare, the better. Here are some key steps you can take:

• Review your payroll: Check which employees will be affected by the new rates.
  
• Update budgets and forecasts: Factor the higher wage costs into your cash flow planning from 1 April 2026 onwards. 
• Consider pricing and productivity: Can you absorb the higher costs within your current prices, or do they need to be uplifted to maintain profitability? Are there adjustments you can make to the work staff are doing or their efficiency that could reduce staffing needs in the coming year? 
• Check for knock-on effects: These wage increases may create pressure to adjust pay for employees who are paid above the minimum rates. Consider whether you need to review other salaries to maintain fairness and morale.

If you would like help modelling the impact of these changes or planning ahead for April, just let us know. We can look at your numbers together and ensure you are prepared.

See: https://www.bbc.co.uk/news/articles/cn41v89xq4go
  
HMRC Fixes SA302 Issue Affecting Class 2 National Insurance for 2024/25
Some self-employed taxpayers who filed their 2024/25 self-assessment tax return may have been incorrectly asked to pay class 2 national insurance contributions (NIC) on their SA302 tax calculation. HM Revenue & Customs (HMRC) has now confirmed that this issue has been fixed.

Who was affected?
HMRC estimates that between 10,000 and 20,000 self-employed individuals who filed before 29 September 2025 may have received an SA302 showing class 2 NIC as payable when it should not have been.

How HMRC is resolving the issue
HMRC have confirmed that they fixed the issue and any SA302 forms issued since 29 September 2025 should show the correct class 2 NIC payments.
For taxpayers that were affected by the error, HMRC have said that they will make all necessary corrections by the end of December 2025. The corrections will be applied automatically and there should be no need to contact them.

Why the error occurred
From 2024/25 onwards, sole traders and self-employed partners with profits above the SPT do not need to pay class 2 NIC. Instead, contributions are treated as having been paid automatically. The SPT is:

• £6,725 for 2024/25
• £6,845 for 2025/26

Earlier in the year, some SA302 forms incorrectly flagged class 2 NIC as payable for taxpayers whose profits were above the threshold.

Key points if you have been affected

• If your SA302 incorrectly showed class 2 NIC as payable, HMRC will correct it automatically. 
• No action is required on your part. 

See: https://www.icaew.com/insights/tax-news/2025/nov-2025/tax-return-class-2-nic-issue-is-resolved-says-hmrc
 
CMA Look to Launch a Study on Private Dental Care
The Chancellor, Rachel Reeves, has written to the Competition Markets Authority, asking that they consider launching a study of private provision in the dentistry market.

Based on her request, the study will consider how effective competition is between dentistry providers, and whether consumers are able to make effective choices and obtain good value for money.

In their reply, the CMA has welcomed the request. They have already conducted some initial exploratory work and will now be developing a specific proposal to carry out the related work.

With many consumers unable to access dental services on the NHS, private dental services have become an increasingly significant part of healthcare in the UK.

For patients and providers alike, the study signals a potential shift toward more oversight of private dental services and could bring changes to how these services are marketed, priced and delivered in the future.

See: https://www.gov.uk/government/publications/cma-correspondence-in-relation-to-private-provision-in-the-dentistry-market
 
HSE Reports 1.9 Million Workers Affected by Work-Related Ill Health in 2024/25
The Health and Safety Executive (HSE) has published its latest annual statistics on work-related ill health and workplace injuries for 2024/25.

According to the report, an estimated 1.9 million workers suffered from work-related ill health during the year. This is broadly in line with recent years, though still higher than pre-pandemic levels recorded in 2018/19.

Mental health remains a key concern
Mental health conditions are still the primary driver of work-related ill health. In 2024/25, 964,000 workers reported stress, depression, or anxiety caused or worsened by work. This continues an upward trend seen over the past several years.

The impact of work-related ill health and injuries is also reflected in lost working time. An estimated 40.1 million working days were lost in 2024/25.

Fatal and non-fatal injuries
In 2024/25, there were 124 worker fatalities and an estimated 680,000 self-reported non-fatal injuries.

HSE Chief Executive Sarah Albon said the statistics “demonstrate that workplace health challenges persist, particularly around mental health.”
To review the report in full, see: https://www.hse.gov.uk/statistics/index.htm
 
Government Announces Rail Fare Freeze Until 2027
The government has confirmed that regulated rail fares in England will be frozen until March 2027. The freeze, announced prior to the Budget, follows a 4.6% rise in March 2025.

Regulated fares include most season tickets on commuter routes, some off-peak long-distance tickets and flexible city-travel products. The freeze applies only to services run by England-based train operating companies.

Unregulated fares can still be set independently by operators, although historically they have tended to move broadly in line with regulated fare changes.
The government said the freeze is intended to help limit inflation and ease pressure on everyday travel costs.

For regular business travellers and employers with staff travelling by rail, the freeze may provide a degree of cost certainty between now and 2027. The government estimates that passengers on the most expensive routes could save more than £300.

The Transport Secretary Heidi Alexander said that the announcement forms part of “wider plans to rebuild Great British Railways.”

See: https://www.gov.uk/government/news/first-rail-freeze-in-30-years-to-ease-the-cost-of-living

21st November 2025 – Hillmans Weekly Update

Welcome to our latest round-up of the latest business and tax news for our clients. Please contact us if you want to talk about how these updates affect you. We are here to support you!

Have a great weekend.

Kind regards,
 
Steve
 
Steven Hillman BSc (Hons) FCA
Chartered Accountant
Tel: 01934 444100
https://www.hillmans.co.uk

FSCS Deposit Protection Limit to Rise to £120,000 from December
The Prudential Regulation Authority (PRA) has confirmed that the Financial Services Compensation Scheme (FSCS) deposit protection limit will increase from £85,000 to £120,000 from the start of December.

The new threshold applies per depositor, per PRA-authorised bank, building society or credit union. The PRA have confirmed that HM Treasury has approved the change.

This is the first change to the limit since 2017 and follows a consultation earlier in the year. The PRA had initially proposed that the limit should rise to £110,000, but feedback provided in the consultation and the latest inflation data prompted a higher final figure.

Temporary High Balances Limit Also Rising
Alongside the core protection limit, the cap for Temporary High Balances (THBs) will increase from £1 million to £1.4 million on 1 December.

THB protection applies to qualifying life events that can temporarily increase a customer’s account balance, such as buying or selling a house or insurance claim payouts.

Implications for Your Business
The increase in limit will be good news if you hold cash reserves in your business to cover working capital, payroll and other running costs.

It is worth noting that the limit continues to be applied ‘per depositor, per PRA-authorised institution’. This means that if you are eligible and hold cash reserves that exceed the deposit protection limit, you could gain further protection by spreading your funds across different authorised institutions.

It is worth checking whether a banking group is operating multiple brands under a single licence. This means you would only receive a single protection limit for the total amounts held across those brands.

Taking a Wider Look at Cash
For many owner-managed businesses, cash reserves naturally rise and fall throughout the year. If you find that your balances regularly build up beyond what the business needs for day-to-day operations, the increase in the FSCS limit could be a useful prompt to review how much cash the business actually needs to hold.

Spreading funds between different banks can increase the level of protection available, but it can also be sensible to take a step back and consider whether those reserves are serving a useful purpose in the business. A simple cash flow review can help identify the amount needed for routine expenses, tax payments and any planned spending over the coming months.

Where cash consistently exceeds this level, you may want to consider:

• Are there investment opportunities for the business that would fit with your business growth plans?
• Would withdrawing funds, such as by dividends, better help you achieve your personal goals?

The right choice for you will depend on your personal and business circumstances, tax considerations and your plans for the business.

If you would like tailored advice or simply assistance in clarifying what level of reserves your business needs, please get in touch. We would be happy to help you!

See: https://www.bankofengland.co.uk/news/2025/november/pra-confirms-fscs-deposit-limit-to-be-increased-to-120000-from-1-december
 
UK Inflation Slows to 3.6% as Energy and Hotel Costs Ease
UK inflation eased to 3.6% in the year to October, down from 3.8% in September, according to the latest figures from the Office for National Statistics (ONS).

Although still above the Bank of England’s 2% target, this is the slowest pace of price rises for four months and comes just before the Chancellor delivers the Autumn Budget.

What is Driving the Latest Change?
The ONS highlighted smaller increases in household energy bills as a key reason for the slowdown. Ofgem raised the energy price cap in October, but the 2% rise was far lower than the 9.6% increase applied this time last year. Hotel prices, which often fall between summer and winter, also dipped more sharply than they did last year.

However, not all categories moved in the right direction. Food inflation rose to 4.9%, from 4.5% in September. Prices increased for items such as bread, meat, fish, vegetables, chocolate and confectionery, although fruit prices fell slightly.

The Food and Drink Federation said the pressures were linked to ingredient and energy costs as well as regulatory requirements, such as packaging taxes and rising National Insurance.

Position Ahead of the Budget
Chancellor Rachel Reeves responded to the figures by saying that one of the main goals of the Budget is to ease cost-of-living pressures. What this will mean in terms of concrete measures we must wait to see.

Prospects for Interest Rates
Although inflation remains above target, the latest figures strengthen expectations of a cut to the Bank of England base rate. Some economists believe this could happen at the next meeting of the Monetary Policy Committee on 18 December 2025.

What This Means for Your Business
Reducing inflation is good news for the economy and increases confidence. You may find your customers becoming more willing to commit to spending again.

If you have clients who have paused projects, re-engaging with them could encourage them to restart work.

At the same time, cost pressures have not disappeared. The ONS reported that the annual cost of raw materials for businesses has continued to increase.

So, keeping an eye on your costs and ways that you can control or reduce them is still key to remaining profitable.

If you would like to discuss how the latest inflation figures or the Autumn Budget may affect your business, please get in touch. We are here to help!
 
Choosing the Right Accounting System for Your Business
For many sole traders and small business owners, reviewing their accounting system only happens when something forces the issue. For instance, many sole traders are currently looking at whether their accounting system meets the requirements for Making Tax Digital for Income Tax.

However, even without a regulatory change, reviewing your accounting systems can yield benefits. The right system can save you time, reduce errors and give you better insight into your business’s finances.

Here are some practical points to consider.

1. Identify Your Needs
Think about what you or your team handle most often. Is it invoicing, logging expenses, monitoring cash flow, or perhaps tracking stock or projects.
You might only need some basic income and expense recording. On the other hand, features like invoice reminders, payment links in invoices, or job costing could be useful to you.

It’s often easier to start by listing your everyday tasks before you look at what software can do.

2. Consider Cost, but Think in Terms of Value
The cheapest option is not always the most effective if it slows you down. A slightly higher monthly fee could be worth it if it saves you work and time.
Ease of use can add a lot of value, too. Simple screens, clear menus and good support can all make day-to-day bookkeeping much less of a chore.

3. Automation and Integrations
Modern software can take care of many repetitive tasks. For instance, importing bank transactions, sending reminders, capturing invoice and receipt details can all be done by software.

If you use e-commerce platforms, job management tools or card payment services, software that can connect to them can save you time by eliminating the need to enter information twice.

4. Planning for Growth
If you expect your business to grow, consider whether the system can grow with you. Some entry-level tools are perfect for start-ups but become limiting once staff, stock or more complex invoicing are involved.

5. Plan for the Switch
Changing accounting systems can be disruptive; however, many platforms offer setup wizards, data import tools and clear guidance that can make the transition easier than you might expect. Choosing to switch at the start of a new financial year can make the process a lot smoother, too.

Choosing the right accounting system is not just about compliance or day-to-day record keeping - it’s an opportunity to make your business run more smoothly and give yourself clearer insight into its financial health.

If you would like help reviewing your current accounting system or recommending options that would suit your business, please feel free to contact us at any time. We would be happy to help you!
 
CMA Launches Major Consumer Protection Drive on Online Pricing
The Competition and Markets Authority (CMA) has announced a number of actions it is taking to improve price transparency and tackle misleading online sales practices. This is the first major use of its new powers under the Digital Markets, Competition and Consumers Act 2024 (DMCCA), which came into force earlier this year.

The CMA has conducted a cross-economy review of more than 400 businesses in 19 sectors. The review highlighted concerns in 14 sectors, particularly around drip pricing and the use of misleading countdown timers.

Focus on online pricing practices
The CMA has opened investigations into eight named businesses due to concerns about a lack of transparency over additional fees, the use of misleading time-limited offers and automatically opting customers into optional charges.

The businesses under investigation are StubHub, viagogo, AA Driving School, BSM Driving School, Gold’s Gym, Wayfair, Appliances Direct and Marks Electrical. At this stage, the CMA has not reached any conclusions as to whether consumer law has been breached.

These investigations are the first to use the CMA’s strengthened consumer enforcement powers. These new powers allow the CMA to determine breaches itself rather than going through the courts. Where appropriate, the CMA can impose fines of up to 10% of global turnover and order compensation be paid to affected consumers.

Wider compliance concerns across the economy
Based on their compliance review, the CMA is also sending advisory letters to 100 businesses across a wide range of consumer-facing industries, including travel, transport, homeware, fitness, event tickets, delivery services, fashion and online voucher providers.

These letters put the recipient businesses on notice to review their pricing and sales practices and bring them into line with the law and the CMA’s guidance.

The CMA has said it will continue to engage with these businesses and may take further enforcement action if problems persist.

New guidance on price transparency
Alongside this enforcement activity, the CMA has published finalised guidance to help businesses understand and comply with the rules on price transparency.

While the DMCCA introduces new obligations, many forms of drip pricing have been prohibited for years under earlier consumer protection legislation.

These include failing to include compulsory charges in the headline price or introducing unavoidable fees only at checkout.

The new guidance aims to clarify expectations around transparent pricing, the presentation of fees, the use of sales claims and other online selling practices.

Next steps
There is no fixed legal deadline for the CMA to conclude its investigations. Cases may lead to formal findings of unlawful conduct, remedies or, in some instances, closure without further action.

Given the scale of the review and the strength of the CMA’s new powers, further enforcement activity seems likely.

If you sell to customers online, it may be worth treating this as an opportune time to review your pricing information to ensure it complies with the new guidance.

To review the price transparency guidance, see: https://www.gov.uk/government/publications/price-transparency-cma209
 
HMRC Reminds Seasonal Sellers to Check Tax Obligations
As the festive season approaches, HM Revenue & Customs (HMRC) is urging anyone who earns money from Christmas crafts, seasonal market stalls, or selling festive items to check whether they need to report their earnings for last year.

HMRC’s “Help for Hustles” campaign highlights the importance of understanding when extra income becomes taxable.

While selling personal belongings from a clear-out generally does not need to be reported, making or selling items for profit - such as handmade decorations, upcycled furniture or running a seasonal market stall - may be subject to tax.

What You Need to Know
Anyone who earned more than £1,000 from side hustles in the 2024-2025 tax year will need to:

• Register for Self Assessment as a sole trader.
• File a tax return.
• Pay any tax due by 31 January 2026.

The £1,000 threshold applies to all trading income combined. For example, someone earning £600 from craft sales and £500 from content creation would need to register, as their total income exceeds the threshold.

If you would like personalised advice on whether you need to file a tax return, please give us a call. We would be happy to help you!
 
Stop! Think Fraud Campaign Launched
The National Cyber Security Centre (NCSC) has launched a campaign to help individuals and small businesses stay secure online.

With the festive season approaching, including the Black Friday sales, the potential for scams increases. For instance, scammers may claim that an offer is only available for a limited time or that products are scarce in order to manipulate people into acting quickly without thinking. Delivery scams are also popular.

Data from the City of London Police suggests that around £11.8 million was lost last year, between 1 November 2024 and 31 January 2025, to online shopping fraud.

How Can You and Your Staff Stay Safe?
The campaign encourages you to take the following four precautions:

1. Check that the shop is legitimate. 
2. Secure your important online accounts, using two-step verification where possible. 
3. Check out and pay securely. 
4. Beware of delivery scams. Check a request is genuine by contacting the organisation directly.

To review the campaign advice in full, see: https://www.ncsc.gov.uk/news/stay-alert-to-holiday-shopping-cyber-scams
 
Renters’ Rights Act: Three-stage implementation plan announced
The government has confirmed how the new Renters’ Rights Act will be phased in, setting out a three-phase approach that runs from May 2026 through to the end of the decade.

Phase 1: Initial reforms from 1 May 2026
The first and most immediate changes will take effect on 1 May 2026. These include the end of Section 21 “no-fault” evictions, meaning landlords will no longer be able to evict tenants without giving a valid reason.

At the same time, if landlords need to get their property back, they will have stronger, legally valid reasons to do so. These include moving in, selling the property, dealing with serious rent arrears or tackling anti-social behaviour.

Tenants will gain other new protections, including the ability to challenge above-market rent increases intended to encourage them to leave. Landlords will also no longer be able to unreasonably refuse requests for pets.

From 1 May 2026, it will become illegal to:

• Increase rent more than once a year.
• Request more than one month’s rent in advance.
• Run rental bidding wars between prospective tenants.
• Discriminate against tenants because they receive benefits or have children.

Councils will be overseeing these new rights. Fines can reach up to £7,000 for breaches, increasing up to £40,000 for repeat or serious offences. Tenants and local authorities will also be able to seek rent repayment orders.

Guidance for landlords and letting agents will be published ahead of these changes, with councils receiving additional funding to help them prepare.

Phase 2: Ombudsman and database
The second phase, beginning in late 2026, focuses on improving oversight and resolving disputes in the private rented sector.

A new Private Landlord Ombudsman will be introduced, offering tenants a free, independent service to help them resolve complaints that have not been addressed by their landlord. This is intended to reduce the need for court action and deliver faster outcomes.

A Private Rented Sector Database will also be launched, requiring all landlords to register themselves and their rented properties. The database will be rolled out in stages across England.

Phase 3: Further quality and safety standards to follow
The final phase will introduce measures aimed at ensuring safe conditions in private rented homes, including the introduction of a Decent Homes Standard.

The government also plans to consult on extending Awaab’s Law to private renting.

The government has already consulted on plans to require that all domestic privately rented properties in England and Wales meet an EPC rating of C or equivalent by 2030, unless an exemption applies. Further details on this will be set out when the government responds to the consultation.

See: https://www.gov.uk/government/news/no-fault-evictions-to-end-by-may-next-year
 
Will Your Business Qualify for the New RHL Multipliers?
Legislation has been passed by Parliament that defines which properties are eligible for the new Retail, Hospitality and Leisure (RHL) business rates multipliers which come into force on 1 April 2026. HM Treasury has also provided guidance to local authorities on how to apply these regulations.

Earlier in the year, the Non-Domestic Rating (Multipliers and Private Schools) Act 2025 laid the legal basis for introducing higher multipliers for the properties of large businesses and lower multipliers for RHL properties. The intention is to help high street RHL businesses that sell to in-person customers.

From April 2026, two lower business rates multipliers for RHL properties will be introduced for rateable values below £500,000.

• A small business RHL multiplier will apply where the rateable value is below £51,000.
• A standard RHL multiplier will apply where the rateable value is between £51,000 and £499,999.

The rates for these multipliers will be confirmed during Budget 2025, which is being held on 26 November 2025.

In a change from the RHL business rates relief that is currently in place, it is intended that there will be no cash cap. This means the RHL multipliers will apply to any property that meets the statutory definition of a RHL property contained in the new regulations.

Broadly speaking, the new definitions will mean that most properties receiving the 40% RHL relief in 2025-26 will qualify for the proposed lower multipliers.

However, local authorities have had discretion in how they have awarded the 40% RHL relief, whereas the new RHL multipliers will only apply where the legal definition is met. This may mean that some properties currently receiving relief could fall outside the new relief measures.

To see whether your RHL business property will qualify for the new RHL multipliers, it is worth reviewing HM Treasury’s guidance.

14th November 2025 – Hillmans Weekly Update

Welcome to our latest round-up of the latest business and tax news for our clients. Please contact us if you want to talk about how these updates affect you. We are here to support you!

Have a great weekend.

Kind regards,
 
Steve
 
Steven Hillman BSc (Hons) FCA
Chartered Accountant
Tel: 01934 444100
https://www.hillmans.co.uk

Reminder: Companies House Identity Verification Becomes Mandatory from 18 November 2025

From 18 November 2025, identity verification with Companies House will begin to be required for all company directors and People with Significant Control (PSCs). This is part of a phased rollout introduced to improve the reliability of information on the UK company register and reduce the risk of economic crime.

When You Need to Verify Your Identity

It’s important to note that 18 November 2025 is not a deadline. It is the start of the requirement. You must complete identity verification before your next relevant filing after that date.

The exact date each person must verify will vary, and Companies House will contact companies directly. Broadly, the requirements are as follows:

Directors
    •    Existing directors must verify their identity as part of their company’s next confirmation statement that falls on or after 18 November 2025.
    •    If you are a director of more than one company, you must verify for each role.
    •    New directors must verify their identity as part of the company incorporation or appointment process.

PSCs (Persons of Significant Control)
    •    If you are both a PSC and a director, you must verify separately for each role.
    •    PSC verification must be completed within 14 days of the confirmation statement date.
    •    If you are a PSC but not a director, you must verify within the first 14 days of your birth month.
    •    For example: if your date of birth is 20 December, your verification window begins on 1 December.
    •    If you become a PSC after 18 November 2025, you must verify within 14 days of being added to the Companies House register.

Future Phases

Companies House has confirmed that identity verification will expand later to include:
    •    Limited partnership roles
    •    Corporate directors
    •    And potentially all individuals involved in filing on behalf of companies

How to Verify Your Identity

There are two ways to verify:

1. Directly with Companies House

Using:
    •    A GOV.UK One Login account
    •    A Companies House account
    •    And a valid form of ID (passport or driving licence)

Once verified, you will receive an 11-character Companies House personal code.
This code is personal to you, not to your company, and can be used across all companies where you hold a role. You will need this code to enable agents (such as accountants, solicitors, and formation agents) to file on your behalf.

2. Through an Authorised Corporate Service Provider (ACSP)

Our firm, Hillmans, is registered as an ACSP and can complete the verification process for you.

This can be useful if:
    •    You prefer us to handle the entire process
    •    You struggle with online verification
    •    You have multiple roles across different companies

A fee applies for this service. If we carry out the verification, your personal code will be sent securely to the email address you choose.

Step‑By‑Step Guidance Available

We’ve prepared a simple walkthrough with screenshots covering:

    •    Creating your Companies House account
    •    Setting up your GOV.UK One Login
    •    Completing identity verification
    •    Retrieving your personal code

You can find the guide here on our website:
🔗 https://hillmans.co.uk/how-to-get-your-companies-house-personal-code

We’re Here to Help

If you need any help verifying your identity or you would like us to carry out the process for you as an ACSP, please get in touch. We’re happy to guide you through every step.

See also:
https://www.gov.uk/government/news/one-million-people-verify-identity-early-ahead-of-companies-house-changes

Budget Speculation: Are Tax Rises Looming?
The Chancellor, Rachel Reeves, gave a surprise ‘pre-Budget’ speech last week that appeared to pave the way for tax rises in the Budget on 26 November 2025.

What did she say?
The Chancellor’s scene setting speech outlined her priorities to cut NHS waiting lists, reduce the national debt, and improve the cost of living.

Quoting world challenges such as the continuing threat of tariffs, persistent inflation, the increasing cost of government borrowing, and pressures on public finances, the Chancellor acknowledged that productivity in the economy is weaker than previously thought.

This all means increasing pressure on revenue for the government.

The Chancellor indicated that her Budget would support businesses in creating jobs, innovating and protecting families from high inflation and interest rates. She further said: “If we are to build the future of Britain together, we will all have to contribute to that effort. Each of us must do our bit …”

This is the clearest indication yet that tax rises are coming for everyone. So, what could this mean for you in the Budget? Let’s explore some of the possibilities.

Changes already due to take effect in 2026 and 2027
There are still some measures announced in Autumn Budget 2024 that have not taken effect yet. These are:

• Capital Gains Tax (CGT): The rate of CGT where Business Asset Disposal Relief (BADR) applies will increase from 14% to 18% from 6 April 2026. 
• Inheritance Tax (IHT): Restrictions on 100% relief for business and agricultural property will take effect from 6 April 2026. Unused pension funds and death benefits will be brought into IHT estates from 6 April 2027.

In addition, the new Making Tax Digital for Income Tax (MTD for IT) becomes mandatory for self-employed individuals and landlords with turnover over £50,000 from 6 April 2026. While not a tax increase, there is an increase in compliance costs to those affected.
 
Predictions for Autumn Budget 2025
Manifesto promises included not increasing National Insurance, income tax or VAT rates. The October 2024 Corporate Tax Roadmap commits to keeping the small profits rate and marginal relief and not increasing the 25% main rate of corporation tax. Enhanced research and development tax reliefs and the £1 million annual investment allowance for plant and machinery capital allowances are also to be kept.

However, the Chancellor’s speech now casts a doubt on these commitments. Here are a few of the possibilities we could see.

• Freeze on income tax thresholds extended: Income tax thresholds and the tax-free allowance are currently frozen until 6 April 2028. This could now be extended to 5 April 2030, bringing more people into tax. 
• Increase to income tax rates: A one or two percentage point increase could be made to income tax rates. To generate sufficient tax revenues, it seems likely that the basic rate of income tax would need to be increased, not just higher rates. 
• National Insurance and partnerships: A current hot topic is the suggestion that the government sees partnerships as receiving a tax break because partnership profits are distributed without having to pay 15% employers’ NI. This might result in the introduction of an additional partnership NI contribution for partners. Current speculation suggests this might be limited to LLPs rather than all types of partnership. 
• Flat rate relief for pension contributions: Pension savings are currently given tax relief based on the saver’s marginal income tax rate. This could be changed so that all savers receive the same flat rate of income tax relief. This would collect more tax from higher earners. 
• Reduce pension income tax-free lump sum: Individuals can often take a tax-free lump sum from their pension when they reach retirement age. Reducing the amount that can be taken tax-free could be one of the options being considered by the Chancellor. 
• Cut Cash ISA saving limits: It was reported earlier in the year that the Chancellor was interested in restricting the amount that can be saved into a cash ISA. Nothing has happened on this so far, however, this could form part of the Budget announcement. 
• Increase the BADR rate further: The CGT Business Asset Disposal Rate is already due to increase to 18% from 6 April 2026. This could be increased further. Another CGT possibility is that the CGT rates could be aligned with income tax rates. This might mean the current 18% rate being increased to 20% and the current 24% rate being increased to as much as 40% or 45%. 
• Cap Principal Residence Relief (PRR): When an individual sells their home they pay no tax, no matter how much they receive, as PRR is unlimited. However, another possible measure could see PRR being capped. 
• Further restrictions to IHT reliefs: Possible measures could include changes to the Potentially Exempt Transfer (PET) regime, reducing or removing taper relief on gifts given three to seven years before the donor’s death, and introducing annual or lifetime limits on exempt giving. 
• VAT: There could be a mixture of good and bad news for VAT. One possibility could be a cut to the 5% VAT rate on household energy. However, privately funded healthcare might perhaps be subject to 20% VAT, like private education.

What should you take away?
Of course, predictions and possibilities of what might happen are speculative. However, the Chancellor’s determination to stick to her fiscal rules that keep the financial markets happy, coupled with the need to generate additional revenue, strongly suggest that there will be some wide-ranging changes in the Budget.

We will keep you updated on the Budget and any changes it brings. If you would like to discuss your personal situation and whether there are any actions you could take before the Budget, please get in touch. We would be happy to help you!

See: https://www.gov.uk/government/speeches/chancellors-scene-setter-speech-ahead-of-budget-2025
 
Free Recruitment Support Available to UK Businesses Through Jobcentre Plus
The Department for Work and Pensions (DWP) has launched a national campaign to offer UK businesses access to no-fee specialist recruitment support through Jobcentre Plus. The service is available to all businesses, regardless of size or sector.

Over the last year, only one in five businesses has used Jobcentre Plus services for support. This may be indicative of a lack of confidence in the service being able to locate suitable candidates.

At the same time, over half of employers in a recent DWP Employer Survey reported difficulties in finding suitable candidates. With the average cost of filling a vacancy estimated by CIPD at £6,125, it could be worth considering trying out the service.
 
Who Can Benefit?
The campaign is particularly focused on sectors with high vacancy rates, including:

• Manufacturing 
• Logistics 
• Retail 
• Hospitality 
• Health and social care 
• Construction 

However, the service is open to all employers, whether they’re recruiting for one role or many.
To find out more and access support, visit the Business.gov.uk website.
 
Skills England launches tools to help businesses upskill for the AI era
A new report from Skills England has indicated that many employers are struggling to keep pace with AI-related changes. Their ‘AI skills for the UK workforce’ report introduces three new tools that could help businesses build confidence and capability in using AI responsibly.

Sector-specific challenges
The report identifies sectors that face particular challenges. For instance:

• In Construction, opportunities such as drone surveying and augmented-reality training are emerging, but low digital literacy remains a barrier. 
• Within the Creative Industries, freelancers and small firms are adopting AI tools for content creation but often without formal training, raising concerns about quality and originality. 
• Advanced Manufacturing is already seeing benefits from automation and predictive maintenance but faces a growing skills gap as its workforce ages.

A consistent theme across all business sectors seems to be uncertainty over what is meant by “AI skills” and what staff need to learn.
 
Three new tools for employers
The three new tools are as follows:

• The AI Skills Framework - identifies the technical, responsible and non-technical skills needed across different job roles and levels. 
• The AI Skills Adoption Pathway Model - shows how businesses typically progress from early awareness to strategic adoption of AI. 
• The Employer AI Adoption Checklist - a practical tool to help businesses assess their AI skills readiness, identify workforce gaps and plan training.

These tools are designed to make AI more accessible to employers, particularly smaller businesses that often lack the dedicated HR or training teams of larger organisations.

Dr Ameen said, “AI is reshaping the world of work across sectors, but without the right skills, too many people and businesses risk being left behind.”

To find out more, the full AI Skills for the UK Workforce report and supporting tools are available through Skills England.

7th November 2025 – Hillmans Weekly Update

Welcome to our latest round-up of the latest business and tax news for our clients. Please contact us if you want to talk about how these updates affect you. We are here to support you!

Have a great weekend.

Kind regards,
 
Steve
 
Steven Hillman BSc (Hons) FCA
Chartered Accountant
Tel: 01934 444100
https://www.hillmans.co.uk

Is It Time to Prepare Your Self-Assessment Tax Return?
HM Revenue and Customs (HMRC) has been reminding taxpayers that there are now fewer than 100 days left to file their tax return and pay any tax due for the 2024-25 tax year.

The online filing deadline applicable to the majority of taxpayers is 31 January 2026.

According to HMRC figures, over 3.5 million people have already filed their return, but with more than 11.5 million people submitting a return last year many are yet to file. HMRC is encouraging an early start to avoid the last-minute rush.

Why file early?
Filing early gives you a clearer picture of how much tax you owe and helps you budget for the payment due by 31 January. If you’re due a refund, you’ll receive it sooner.

Things to be aware of for this year’s return

• Capital Gains Tax (CGT): The CGT rates changed partway through the tax year. This is not automatically calculated on the Self-Assessment tax return. If you sold assets such as shares after 30 October 2024, the change in rate will need to be factored in. 
• High-Income Child Benefit Charge (HICBC): A new digital PAYE service means that if you only complete a tax return to pay this charge, you may no longer need to. Eligible claimants can opt to have the charge collected through their tax code instead. HMRC can de-register you from Self-Assessment if you qualify – either for this tax year or the next, depending on whether you have already submitted your return.
• Winter fuel and heating payments: You do not need to include your Autumn 2025 Winter Fuel Payment (or Pension Age Winter Heating Payment in Scotland) on your 2024-25 return. These payments will be accounted for in your 2025-26 tax return, not due until 31 January 2027. 

Making Tax Digital
Looking ahead, sole traders and landlords with a turnover above £50,000 will need to use MTD for Income Tax from 6 April 2026. This will require quarterly submissions of income and expenses through compatible software.

If you are affected by this change, we recommend making early preparations so that you are ready in good time.

Watch out for scams
As ever, HMRC is warning taxpayers to stay alert to scams, particularly around this time of year. Your HMRC login details should never be shared with anyone. HMRC guidance on spotting and reporting scams can be found on their website.

Getting started
With less than 100 days to go, it’s a good time to make a start. Completing your return early gives peace of mind, allows time to resolve any queries, and helps you plan for your tax payment well before the deadline.

If you would like help with preparing and filing your tax return or with how to use MTD for Income Tax, please get in touch and we would be happy to help you!

See: https://www.gov.uk/government/news/the-countdown-begins-self-assessment-deadline-is-100-days-away
 
Stress Awareness Week: Five Tips on Managing Stress
The International Stress Management Association (ISMAUK), a registered charity, is highlighting International Stress Awareness Week set to take place from 3 to 7 November 2025, with Stress Awareness Day on Wednesday 5 November.

While good stress management applies to all organisations, it can be particularly relevant for small business owners and company directors, who often face the twin pressures of running a business and supporting their teams.

Stress management is vital for your health and your business
Running a business can be rewarding, but it’s also demanding. When stress isn’t effectively managed, it can have detrimental effects on concentration, decision-making and health, for you and your staff, and can impact the success of your business.

Employers also have a legal duty to protect staff from work-related stress. The Health and Safety Executive’s Working Minds campaign provides information and tools that can be helpful for employers in fulfilling this duty.
 
Recognising the signs
The NHS says that stress can cause many different symptoms, affecting how you feel physically, mentally and also how you behave.
For instance, stomach problems, difficulty concentrating, struggling to make decisions and being irritable and snappy can all be symptoms of too much stress. Spotting these indicators early makes it easier to take practical action.

Taking a strategic approach
What are some actions you can take to help with stress? Here are five tips.

1. Talk
The old adage that a problem shared is a problem halved still holds true. A good support network is vital, and taking time for activities and relaxation with family and friends can provide great opportunities to destress and help you see things in a different way.

Providing opportunities for staff to talk in the workplace is also important; however, cultural norms may make directly discussing “stress” or “mental health” difficult to do.

So, you might choose to focus on workload, energy levels or what makes the job easier or harder. For instance, asking someone “How’s your week going?” or “Is there anything getting in the way of your work?” can open a conversation without using language that puts people off.

2. Have some “me time”
Try to set aside regular times each week for time away from work that allows you to do something you enjoy.

Setting goals and challenges - such as a new sport or learning a new skill or language - can give you a chance to switch your attention away from work and refresh your thinking.

3. Time management techniques
Some simple, low-effort time management techniques can help when you’re juggling several priorities.

For instance, some spend the last 10 minutes of each workday writing down what needs to be done the next day. This can help draw a line under the day, allowing you to switch off in the evening and start the next day in a more focused way.

Others might use the “big three” rule. Each morning, they identify the three most important tasks that will help the business move forward. Do these before doing anything else if possible, and fit smaller or routine tasks around them.

The key is to find a few methods that fit naturally into your working style and apply them consistently. Over time, small improvements in how you organise your day can make a noticeable difference to stress levels.

4. Plan ahead
Some sources of stress are unavoidable. There are times when you know that a day or event is going to be stressful. If so, mapping out what’s likely to happen - perhaps a simple checklist or timeline - can increase your sense of control.

You could also plan lighter tasks before or after something you know is going to be stressful. Avoiding back-to-back high-pressure activities where possible and building small recovery periods into the day can all help you to stay composed.

5. Don’t try to change what you cannot change
Focusing on what you can control, rather than what you can’t, can help change how your mind and body respond to pressure.

For instance, when we worry about something that can’t be influenced - a client’s reaction, an unexpected policy change or the weather - our minds keep running, but we achieve nothing.

Focusing only on what’s within your influence encourages you to think practically. When you feel stress building up you might try writing a list of what’s in your control and what’s not. Then work out what you can do about the things that are within your control.

In conclusion
Stress Awareness Week is a timely reminder that managing stress should be an ongoing part of good business practice. Why not pick one thing you could do this week that will help to lower your stress levels?

See: https://isma.org.uk / https://www.nhs.uk/mental-health/feelings-symptoms-behaviours/feelings-and-symptoms/stress/
 
Directors’ Report Requirement to Be Removed
As part of its move to reduce ‘red tape’ and aid business growth, the government has announced plans to remove the requirement for companies to include a directors’ report as part of their annual accounts.

Micro-entities are already exempted from the requirement to include a directors’ report in their accounts; however, it is intended that the requirement will be removed for all companies. It is estimated that this will affect approximately 440,000 companies.

Medium-sized private companies will also be exempted from the requirement to prepare a strategic report as part of their annual report and accounts.

Wholly-owned subsidiaries will also be exempted from preparing a strategic report, provided their disclosures are included in the UK parent company’s annual report and accounts.

Estimates suggest that these changes could save UK businesses in the region of £230 million each year, and legislation to bring about these changes will be introduced as soon as possible.

See: https://www.icaew.com/insights/viewpoints-on-the-news/2025/oct-2025/directors-reports-to-be-scrapped-and-more-companies-exempt-from-strategic-reports
 
ICO Consultation Opens on New Email and Text Marketing Rules for Charities
The Information Commissioner’s Office (ICO) has launched a consultation on how charities can make use of new rules that will allow greater use of electronic marketing in contacting their supporters.

From January 2026, the Data (Use and Access) Act will introduce a new ‘charitable purpose soft opt-in’. This will allow charities to send marketing emails and texts to people who have expressed interest in or offered to support a charity - even if they haven’t specifically ticked a consent box - provided certain conditions are met.

How the new rule will work
The change is intended to make it easier for charities to stay in touch with potential supporters and raise funds, while still protecting individuals’ data rights.
The charitable purpose soft opt-in will not apply to contacts already held in existing databases. Charities must always provide a clear opportunity to opt out - both when contact details are first collected and in every communication sent.

ICO’s consultation
The ICO’s consultation runs until 27 November and invites feedback from charities and others working in the third sector.
Emily Keaney, the ICO’s Deputy Commissioner for Regulatory Policy, said the soft opt-in is intended “to help charities stay connected with the people who want to support them, while still making sure everyone has control over how their data is used.”

Steps charities can take now
Although the new rule won’t apply until 2026, the ICO has provided some tips on what charities can do to prepare.

1. Update your privacy notice - make sure it clearly explains how your charity will use their personal information. 
2. Plan your communications - decide how you will explain the soft opt-in when collecting new contact details, and how you’ll make it clear why someone is receiving marketing messages. 
3. Keep separate contact lists - since you cannot send electronic mail marketing to people whose contact details were collected before the soft opt-in commences, you’ll need to keep separate lists of those who have given their consent and those who will be contacted under the soft opt-in. 
4. Train your team - ensure staff know how to handle queries or complaints about marketing messages.

 
Next steps
Charities interested in shaping how the new rules are applied can respond to the ICO’s consultation.

See: https://ico.org.uk/about-the-ico/media-centre/news-and-blogs/2025/10/consultation-on-new-charitable-purpose-soft-opt-in-rules-to-support-fundraising/
 
Renters’ Rights Act Becomes Law in England
The government’s Renters’ Rights Bill has now become law, following Royal Assent last week. The new Act introduces a wide range of changes for private landlords in England.

The details on how and when these new rules will take effect are still to come, but here is a review of some of the key measures that will be introduced.

End of Section 21 evictions
The most notable change is the abolition of Section 21 ‘no fault’ evictions.

This doesn’t mean that landlords cannot evict tenants, but they will only be able to do so in certain circumstances.

Tenancy structure
The Act will replace most existing tenancy types with a single system of periodic (rolling) tenancies.

This means that if you use fixed 12 or 24-month contracts, they will no longer be possible. Tenants will be able to give two months’ notice at any time, rather than being tied in for a year or longer.

New ombudsman and registration requirements
A Private Rented Sector Ombudsman will be set up to handle complaints from tenants. Membership will be mandatory for landlords, and the ombudsman’s decisions will be binding.

A new Private Rented Sector Database will also be created. This is to help landlords understand their legal obligations and demonstrate compliance. Tenants will be able to use this when deciding to enter a tenancy agreement. Registration on the database may be necessary before being able to use certain grounds for repossession.

Other measures
Further reforms include:

• A ban on rental bidding. Landlords will be required to advertise a fixed rent and cannot accept offers above this. 
• Landlords will not be able to refuse tenants because they have children or receive benefits. 
• Tenants will have strengthened rights to request a pet in the property, which the landlord will have to consider and cannot unreasonably refuse. 
• Application of the Decent Homes Standard and Awaab’s Law to the private sector, which will impact what is expected with the condition of properties and timescales for repairs. 
• Local authority enforcement will be strengthened with the expansion of civil penalties, introducing investigatory powers and requiring local authorities to report on their enforcement activity.

Details on how and when the law will be implemented can be expected over the coming weeks.

See: https://www.gov.uk/government/news/historic-renters-rights-act-becomes-law

31st October 2025 – Hillmans Weekly Update

Welcome to our latest round-up of the latest business and tax news for our clients. Please contact us if you want to talk about how these updates affect you. We are here to support you!

Happy Halloween! 🎃 Have a great weekend.

Kind regards,
 
Steve
 
Steven Hillman BSc (Hons) FCA
Chartered Accountant
Tel: 01934 444100
https://www.hillmans.co.uk

Government borrowing rises in September - what it could mean for businesses ahead of the Budget
Official figures show that UK government borrowing reached £20.2 billion in September - the highest for the month in five years. The figures, released by the Office for National Statistics (ONS), underline the financial pressures facing the Chancellor as preparations continue for next month’s Budget.

Borrowing, which measures the gap between government spending and income from taxes, was £1.6 billion higher than in September last year. The ONS said that although the government raised more through taxes and National Insurance, this was outweighed by higher spending, particularly on debt interest and inflation-linked costs.

Implications for the upcoming Budget
Higher borrowing means there is less room to manoeuvre in November’s budget. The rise in debt interest costs - nearly £10 billion in September alone - reduces the funds available for tax cuts or new spending commitments.

These figures are likely to make the Chancellor’s job more difficult when setting out her Budget plans. The Office for Budget Responsibility will update its forecasts alongside the Budget, setting out how much “headroom” the Chancellor has under her own fiscal rules. Many expect that the chancellor will need to raise taxes to meet those rules.

Analysts at Capital Economics estimate that around £27 billion may need to be raised, with households expected to carry much of that burden.

What might be in the Budget
Chancellor Rachel Reeves has been keen to emphasise that the government remains committed to manifesto promises not to raise the rates on income tax, VAT or National Insurance.

She has also made promises on taking “targeted action to deal with cost of living challenges” in the Budget. One idea suggests that the current 5% rate of VAT charged on energy could be reduced.

This suggests that any tax rises will at least be framed in such a way as to avoid the impression that people are receiving less in their pay packets.
 
Speculation around where tax rises could come from includes:

• Freezing tax thresholds. This is a stealthy way of bringing more people into higher rates of tax and increasing tax yield without being immediately felt by most. 
• Cutting the employee rate of National Insurance, while adding the same amount to income tax. This would have a limited effect on those who are employed, but increase tax collected from pensioners, landlords and the self-employed. 
• Reforming property taxes, such as replacing stamp duty with a property tax, making landlords pay more and removing principal private residence relief. 
• Reducing the tax relief available on ISA and pension saving and the size of the tax-free lump sum that can be withdrawn.

Keep calm and carry on
Of course, the uncertainty that precedes a Budget leads to all kinds of speculation. We will only know what measures will definitely be used when the Budget announcement takes place.

We will keep you updated following Budget day on the measures likely to affect you. If you would like personalised advice on your tax situation, please call us at any time. We would be happy to help you!

See: https://www.bbc.co.uk/news/articles/c8035130918o
 
Bridging Generational Gaps: How to Build a Better Workplace for Everyone
Conversations about Generation Z (those born roughly after 1996) and the workplace tend to generate headlines - perhaps even blaming younger workers for disrupting the traditional norms of office culture.

Generational differences are nothing new, but if differences lead to conflict this can be detrimental both to staff and your business. When differences are managed well, though, they can bring out the strengths of every generation - creating a more innovative, resilient and productive workplace.

What’s happening
Many employers are noticing a shift in attitudes. Younger workers tend to value flexibility, mental health, and meaningful work, while many older workers were shaped by more traditional ideas about presence, hierarchy and progression.

Older workers may view the younger generation as lacking “grit” or commitment, while younger employees might see their more experienced colleagues as resistant to change or too wedded to traditional ways of working.

Many Gen Z entrepreneurs are also bringing fresh values into the way they run their own businesses - building businesses that are tech-savvy, purpose-driven, and often more informal.

What can you do?
In the main, it’s about practical management and good communication. Here are a few ideas:

• Review how you measure contribution. If your business still prioritises time in the office or visibility over measurable output, you may find tension between generations. Shifting the focus to outcomes helps value both experience and fresh ideas. To do that successfully, it’s important to recognise that productivity can look different across roles and stages of career. 
• Balance flexibility with consistency. Expectations around work-life balance and flexibility vary widely. Having a clear policy that sets boundaries while allowing reasonable autonomy will help both those seeking balance and those who value routine and predictability. 
• Create an environment that supports learning. While workers starting on their career are generally looking for progression and purpose, those with more experience benefit from opportunities to refresh their skills, share knowledge and adapt to new technologies. We’re not necessarily talking about training courses. De-emphasising hierarchy in the workplace and finding ways for younger and older workers to team up on projects can provide learning opportunities for everyone. 
• Encourage open, respectful communication. Different generations often prefer different communication styles. Agreeing on how and when to communicate - whether by message, call or face-to-face - helps avoid confusion and keeps everyone connected. 
• Value different work styles and motivations. Some people thrive on rapid change, others on stability. Help staff understand each other’s preferred way of working so that workloads and responsibilities play to everyone’s skills.

The takeaway
Generational differences aren’t a threat - they’re a resource. For your business, blending the energy and digital fluency of younger staff with the experience and resilience of older workers can be a real competitive advantage.
The most effective goal isn’t to preserve a single way of working but to create one that works for your business. That starts with communication, trust, and a willingness to keep learning from each other.
 
Government strengthens regulators’ duty to support business growth
The government has announced a major shake-up in how UK regulators operate, aiming to make them more accountable and more focused on supporting business growth.

Beginning last week, regulators have a stronger growth duty, meaning they’ll be expected to balance their oversight role with helping businesses invest, innovate and expand. The change is designed to ensure regulation remains proportionate and doesn’t hold back economic activity.

A new public dashboard of regulator performance will also be launched. The new GOV.UK site, which will be updated quarterly, will bring together performance data into one place and allow for direct feedback to the government.

Business and Trade Secretary Peter Kyle explained that the aim is to strip back unnecessary rules and pointless paperwork while keeping essential protections in place. He described the stronger growth duty and new transparency measures as part of the government’s wider “Plan for Change” to boost investment and job creation.

For business owners, will these changes mean a more responsive and balanced regulatory environment that’s clearer about helping your business grow? Let’s see.

See: https://www.gov.uk/government/news/growth-placed-at-the-heart-of-regulators-remit-alongside-new-measures-to-boost-scrutiny-and-transparency
 
Nearly 500 employers fined over £10 million for minimum wage breaches
Almost 500 UK employers have been fined a total of £10.2 million after failing to pay the National Minimum Wage correctly, according to the latest government list. Following investigations by HMRC, around 42,000 workers have now received back pay totalling £6 million.

The list of employers includes businesses of all sizes and across a wide range of sectors - from retail and hospitality to childcare and manufacturing. Many are well-known household names, showing that even established employers can get caught out by the rules.

The importance of getting it right
Employers found to be underpaying staff not only have to make good the shortfall but also face financial penalties of up to 200% of the arrears (capped at £20,000 per worker), as well as being publicly named. Employers who deliberately fail to pay the minimum wage may face a potentially unlimited fine.

Niall Mackenzie, Chief Executive of Acas, said that failing to pay the correct minimum wage “can result in grievances and potentially legal action, including costly employment tribunals, as well as being named and shamed.”
 
Common causes of underpayment
Failing to pay the minimum wage correctly isn’t necessarily intentional. For instance, a business can get caught out by making deductions or charges (such as for uniforms or office accommodation) that take pay below the legal minimum, or not accounting for unpaid time spent working, such as while training.

A breach can also occur if an employer fails to update pay rates when they change each April. The current rates that have applied since April 2025 are:

• National Living Wage (21 and over): £12.21.
• Ages 18-20: £10.00.
• Under 18 and apprentices: £7.55.

Getting minimum wage payments right not only avoids penalties but also supports staff morale, retention and reputation - all key to running a successful business.

If you need any help with your payroll and minimum wage payments, please get in touch. We would be happy to help you!

See: https://www.gov.uk/government/news/6-million-repaid-to-workers-as-government-cracks-down-on-employers-underpaying-their-staff
 
£56 million boost for devolved fishing industries aims to strengthen coastal economies
Fishing businesses and coastal communities across the UK are set to benefit from a major new funding package aimed at supporting growth, sustainability and local jobs.

The government has announced a new Fishing and Coastal Growth Fund, which includes £56 million earmarked for Scotland, Wales and Northern Ireland. The funding will be delivered by the devolved governments, allowing investment to be tailored to local priorities and the specific needs of fishing communities.

The Scottish Government will receive £28 million, the Welsh Government £18 million, and the Northern Ireland Executive £10 million - allocations based on the Barnett Formula.

The money will go towards modernising the fishing fleet with new technology and equipment, training the next generation of fishers, and investing in coastal infrastructure to support trade and tourism. The aim is to create a more secure, sustainable and economically successful fishing and aquaculture sector, helping coastal towns and villages to thrive.

The UK government has also said it will work closely with the devolved administrations to ensure the funding supports both local needs and the shared goal of a thriving, sustainable industry.

Alongside the new fund, the government expects to begin talks with the EU this autumn on a new Sanitary and Phytosanitary (SPS) Agreement, which would reduce export barriers for UK seafood businesses and simplify trade with the EU.

For businesses in the fishing and seafood supply chain, this could mean greater investment, more opportunities to upskill staff, and a more competitive export environment - all positive signs for the sector’s long-term growth.

See: https://www.gov.uk/government/news/fishing-and-coastal-growth-fund-will-boost-regional-economies
 
Addressing workplace conflict: insights from a recent Acas roundtable
The Advisory, Conciliation and Arbitration Service (Acas) recently hosted a roundtable with partners in Wales to explore the causes of workplace conflict and how organisations can respond more effectively. Several recurring themes emerged from the discussions.

Participants highlighted generational divides in attitudes towards work, rights and identity, and stressed the importance of strong people management skills for managers.

There was also a recognition that formal procedures often become the default approach, with managers feeling hesitant to handle issues informally.
Economic pressures and their effect on pay negotiations were also noted as a common trigger for conflict.

Supporting managers to manage conflict
The discussions made it clear that managers and leaders need both training and practical experience to handle conflict constructively. Training alone isn’t enough - managers also need time to practise the skills they have learned, especially when it comes to having productive conversations and negotiating effectively.

Key points highlighted during the roundtable included:

• Give managers time to learn and practise. Expecting instant expertise after training is unrealistic. They need opportunities to gain experience and then have the time to reflect on them and become more skilled. 
• Empower managers. A strong, supportive relationship with HR helps managers feel confident to act appropriately and decisively. 
• Lead by example. Senior leaders should be role models of the behaviours they expect from others. 
• Address conflict early. Not all situations can be resolved informally, but recognising early warning signs and taking timely action can prevent escalation. 
• Take a collaborative approach to resolving conflicts. 

Tackle conflict early
Acas report that the earlier they get involved in resolving conflicts, the better.

While recognising that not all workplace conflict can be resolved at an early stage, Joanna Nunn, Interim Chief Conciliator at Acas said, “There are real long-term gains to be made shifting the mindset from adversarial positions and instead refocusing on dialogue and the possibility of positive outcomes for both parties. But this can only take place before positions become entrenched.”

Providing managers with clear guidance and training on handling conflict can help to resolve issues quickly, keeping teams focused and happy while reducing disruption.

See: https://www.acas.org.uk/building-partnerships-to-improve-workplace-relations