3rd July 2026 – 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

What Burnham’s rule could mean for the UK
Not yet elected, the new MP for Makerfield, Andy Burnham, is seen as a shoo-in as our new Prime Minister. A politician with the success of growth in Manchester and his ‘man of the people’ persona, he is the very antithesis of Sir Keir Starmer.

After months of Labour Party pressure, a failing public image and a series of policy rollbacks, Sir Keir Starmer resigned as Prime Minister and opened the door for a so-far uncontested Mr Burnham to take leadership.

So far, there has been a lack of detail on policies, save that he will follow the Labour Manifesto. Perhaps this is unsurprising as he is still officially in a Labour leadership campaign, but past statements and his Manchester policies point to what he might want to achieve.

The most important commitment Mr Burnham had made so far was his pledge to pursue electoral reform after the next election with a form of proportional representation, perhaps based on the transferable vote system found in Northern Ireland.

The financial market’s view
Whoever is Prime Minister will find that the same fiscal rules, which Mr Burnham has undertaken to follow, leave limited options for increased spending.

Usually, as Prime Ministers resign, the foreign exchange and bond markets react unfavourably, especially if they view the next incumbent as bad for business. So far, the bond markets have not reacted to a Prime Minister Burnham, a sign that the City of London is willing to give him a chance,

In part, the City and the markets have given him a chance because his unofficial economic advisers have big reputations. Andy Haldane, the former Bank of England chief economist and Lord Jim O’Neill, a former Goldman Sachs chief economist, have stepped up to help him.

He has also backtracked on his more controversial statements, such as when he told the New Statesman in September 2025 that, “We’ve got to get beyond this thing of being in hock to the bond markets.”

Two days later told the FT, “People have deliberately misinterpreted my comments about the bond markets.”

Policies
While Mr Burnham has floated policy ideas, his detractors who know him have called him a ‘weathervane’ and ‘conflict-averse’ and the new ideas may simply disappear.

“Andy wants to be loved and avoids making difficult decisions,” said one.

Devolution
He has been vigorous in his support of devolution and plans to set up a new ‘devolution department’ in Manchester, along with a ‘Northern No 10’. Its aims are to boost regional growth and shift power out of London and Whitehall.

He is also thought to be considering breaking up the Treasury despite warnings that this would lead to huge disruption, requiring staff to apply for new jobs.

This devolution of decision-making will also see capital spending diverted from the south-east.

He points to the success of the decisions he made as mayor in Manchester that saw the city produce twice the growth rate as the rest of the country, along with housing and transportation improvements. He aims to use the same model for housing strategy, direct housing investment funding and coordinated affordable housing programmes elsewhere in the UK.

On the other hand, most economists who have studied the impact of devolution have not identified any significant increase in overall economic growth rates in Scotland, Wales and Northern Ireland over the past 25 years.

Small businesses and pubs 
Mr Burnham has called some of Labour’s policies on small businesses ill-considered. He has touted a cut to business rates for pubs and music venues of 20%. Certain small family-owned businesses, such as cafes and shops, could see rates abolished altogether.
These policies would be paid for through higher levies on warehousing giants such as Amazon.

Pensions
Although there are signs that he might look at cutting some social security bills, he has promised to leave the ‘triple lock’ on the state pension in place.

After years of supporting the £10.5 billion compensation for the Waspi women, those born in the 1950s who lost thousands of pounds each after not being properly informed of a rise in the state pension age, he has backtracked and ruled it out.

Young people and welfare spending
He has said that he will lower welfare spending, a policy that Lord Jim O’Neill believes is critical for growth rather than increasing taxes.
In particular, he supports the Milburn Review into young people's employment outcomes. The 2026 Milburn Review by former Cabinet minister Alan Milburn warned that nearly one million young people (16–24) in the UK are Not in Education, Employment, or Training (NEET).

The review condemned this as a ‘record of failure’ and argued structural issues are trapping young people on benefits instead of helping them work, something that Mr Burnham has promised to rectify.

Taxes
Mr Burnham has confirmed manifesto commitments not to raise the rate of the three biggest taxes, but talking to the Daily Telegraph last year, he said there was ‘definitely a case’ to increase the additional rate of income tax to 50p, up from the current 45p.

He has also pushed the Chancellor, Rachel Reeves, to introduce a 10p band for the lowest-paid workers. It currently stands at 20% on incomes between £12,571 and £50,270.

It is unlikely that Corporation Tax or employer National Insurance Contributions will be reduced.

Housing
The provision of housing seems to be a primary target for Mr Burnham, but it is social housing, rather than affordable homes, that he seems keen on.  

He has floated a few ideas for financing, including shifting the government’s existing £39bn affordable housing programme entirely to council housing. Another is using the UK’s national wealth fund to provide seed funding to new regional banks, along with private investment, for a programme of new council homes

Additionally, revenue would be raised by shifting away from council tax to a land value tax. A land value tax is an annual levy on the market rental value of land.

His background
Andy Burnham, 56, has already lost twice in the run for the Labour leadership in 2010 and 2015. It followed stints in cabinet under Sir Tony Blair, where he was number two in the Treasury and as health secretary under Gordon Brown.

He has comfortably won three mayoral elections in Greater Manchester since 2017.
 
Britain's yearly £44m health & safety violations bill
A new Freedom of Information (FOI) request has discovered that health and safety violations cost British employers over £44 million per year. The Health and Safety Executive (HSE) revealed that serious breaches have resulted in an increasing number of prosecutions between 2023 and 2025.

The figures show that between 2021 and 2025, the average annual fines to businesses averaged £44.1 million a year, with 2025 showing a slight decline to £40.9 million. In contrast, the number of serious breaches resulting in prosecution charges increased over the last three years, rising from 428 in 2023 to 446 in 2024 and 496 in 2025.

These numbers are expected to increase in 2026. Prosecution charges are brought against companies, owners and directors when an investigation is in the public interest and reveals a serious breach of regulations.

The FOI request came from Breathe HR, experts in human resource management and compliance supporting Small to Medium-sized Enterprises (SMEs). It warns that as costs continue to rise for small businesses, a health and safety violation could financially cripple a company.

Construction firms accounted for 38% of prosecution charges last year, the largest sector.

Phil Coxon, Managing Director at Breathe HR, said, “Reviewing health and safety policies and risks might not be the most glamorous task on employers’ to-do lists’, but our research shows it’s not something leaders can afford to overlook." 

Good health and safety policy
His company recommends several general steps that businesses should take to remain compliant.

• Create a health and safety policy, review it regularly and store it somewhere safe and easily accessible for employees.
• Appoint one clear 'competent person' responsible for health and safety overall. Ensure there’s clear day-to-day responsibility at each site or location.
• Complete suitable and sufficient risk assessments for all workplaces, sites and activities. Review them regularly. 
• Be ready to show evidence of what you’ve done for audits, insurers or client requests. Keep accurate and contemporaneous records, including tracking incidents.
• Make sure employees know and understand the company's policy on health and safety. Display a health and safety law poster at each working location.
• Carry out regular risk assessments and put controls in place to address hazards. 
• As well as a well-thought-out first aid policy, be aware of employees' well-being. Employers have a duty of care and must do everything they reasonably can to support health and wellbeing.

Other recommendations for specific risk can be found on the Breathe HR website. https://www.breathehr.com/en-gb/resources/health-and-safety-basics-a-checklist-for-smes

Small businesses account for two-thirds of Britain’s tax shortfall
The latest figures from HMRC reveal that the Treasury had a substantial £59.2 billion shortfall from unpaid taxes for the tax year 2024-2025. The 'Measuring tax gaps 2026 edition' found that the tax gap, which measures the difference between the amount of tax expected to be paid and what was actually collected, stood at an estimated 6.4%, up from 5.3% for 2023-24.

HMRC collected £865.2 billion over the 2024 to 2025 tax year, representing 93.6 per cent of all tax due, but non-compliance by small businesses alone constituted 62% of the gap. This was primarily due to unpaid Corporation Tax, as the tax gap rose to 18.1%.

HMRC noted that the tax gap for Corporation Tax had been broadly stable until COVID. In 2019-2020, it rose to 15.6%, but this was partly due to improvements in data collection.

Summary of figures

• The tax gap for VAT was 6.6% in 2024-2025.
• The tax gap for Income Tax, National Insurance contributions and Capital Gains Tax stood at 4% in 2024-2025, well below the 5.3% in 2013-2014.
• The tax gap for excise duty reduced was 5.5% in 2024-2025.
• The largest components of the tax gap by tax type in 2024-2025 are for Corporation Tax, Income Tax, National Insurance Contributions and Capital Gains Tax.
• The tax gap from individuals was the lowest proportion of the tax gap at 4% in 2024-2025.

Failure to take reasonable care, error and evasion are among the main behavioural reasons for the overall tax gap. Tax evasion accounted for 12% of last year’s tax gap, HMRC said.

To see the full details of HMRC's report, go here https://www.gov.uk/government/statistics/measuring-tax-gaps

If you need help with your tax calculations and returns, please contact us. We'd be happy to help.
 
A response to Land Remediation Relief consultation 
The government has published a response to its consultation 'Land Remediation Relief' (LRR). The review sought to understand whether the Corporation Tax relief continues to incentivise the redevelopment of brownfield land and whether reforms are needed to ensure it remains effective, accessible and aligned with modern remediation practices.

LRR is a Corporation Tax relief designed to support the regeneration of contaminated or long-derelict land and reduce pressure to develop greenfield sites. The relief allows companies to claim an additional 50% for qualifying revenue expenditure and 150% for qualifying capital expenditure.

It has two components: contaminated land and derelict land.

Contaminated land relief gives relief for expenditure on preventing, minimising or remedying harm caused by contamination. Derelict land relief is for land that cannot be made productive without removing buildings or structures, provided it has been continuously derelict since 1 April 1998.

The consultation respondents said that LRR rarely drives site selection; commercial factors such as planning risk, build costs and market conditions determine whether a site is taken forward. LRR is seldom considered at the outset because qualifying costs cannot be reliably estimated until intrusive investigations begin. 

Many respondents said the scope of qualifying expenditure is too narrow. Activities such as certain demolition works, mineshaft grouting, gas-holder remediation and some invasive species removal fall outside the regime, despite being essential to making land developable. 

SMEs reported significant administrative challenges as remediation costs are often embedded within wider contractor pricing, making it difficult to identify qualifying expenditure. There were also inconsistent interpretations of the rules and a lack of clear HMRC guidance.

Interestingly, the payable tax credit had a limited influence on a project. Many businesses preferred to carry losses forward for relief at higher tax rates. Views on grants were mixed. Grants can materially affect viability but are discretionary and slow to secure. LRR is rules-based and predictable, but its benefit is delayed and often modest.

The government has concluded that LRR is not meeting its intended objective of materially incentivising brownfield development.

While LRR remains valuable for some marginal or highly contaminated sites, the government sees a compelling case for reform rather than abolition.

Further details will be published in due course.
 
More consultations hint at what's to come
The government has published a raft of consultations on tax and business policies. It is worth being aware of these, as they are a good indicator of future policy direction likely to impact small businesses.

It is worth noting that your responses to a subject of interest will not be wasted. Most consultations get surprisingly few responses, and those are generally dominated by interest groups and industry-related organisations. One consultation on Welsh tax proposals got only four responses.

Call for evidence on PAYE Settlement Agreements (PSAs)
HMRC have launched a call for evidence on how 'PAYE Settlement Agreements (PSAs)' operate in practice, to improve clarity, consistency and administrative efficiency. PSAs allow employers to settle the Income Tax and Class 1B National Insurance Contributions (NICs) due on certain benefits and expenses on behalf of employees, instead of reporting them through payroll or on a P11D.

The government is seeking detailed feedback on how employers decide what to include in a PSA, how the rules are interpreted, and whether the current framework remains fit for purpose. 

The call for evidence focuses on the practical operation of PSAs rather than the underlying tax rules for benefits and expenses. HMRC want to understand:

• How organisations determine whether an item is minor, irregular or impracticable to report through standard PAYE routes.
• How PSAs interact with other reporting mechanisms, including payrolling benefits and P11D reporting.
• How employers apply the existing rules in real-world scenarios and where uncertainty or inconsistency arises. 

The government emphasises that PSAs are intended for items where it is genuinely difficult to identify the precise value attributable to each employee, such as catering at large staff events where individual consumption cannot be measured.

HMRC want to know how PSAs are managed, including time and resources, how employers handle calculations, including gross-up methodologies and allocation across tax bands. 

The call for evidence also explores whether PSA rules affect employers differently depending on size, sector or workforce structure. HMRC are particularly interested in whether SMEs face disproportionate administrative burdens.

The consultation closes on 15 September 2026. Responses can be made by email or by post. 

The full consultation document can be found at https://www.gov.uk/government/calls-for-evidence/paye-settlement-agreements-call-for-evidence/paye-settlement-agreements-psas

Mandatory Direct Debit proposed for VAT and PAYE payments
The government is consulting on proposals that will require most VAT-registered businesses and employers to pay VAT and PAYE liabilities by Direct Debit. The aim is to reduce late payment and simplify the payment process.

HMRC's analysis suggests that late payment is often linked to missed deadlines or to payments being allocated incorrectly, rather than to an inability or unwillingness to pay. Views are sought on why businesses that could use Direct Debit choose to pay by other electronic methods, the impact of requiring payment by Direct Debit and the exceptions or alternative arrangements that may be needed.

Currently, PAYE legislation only requires employers with at least 250 employees to pay via a range of electronic means, including Direct Debit.

Any changes would include updated sanctions for non-compliance and the consultation seeks views on these issues.
The consultation closes on 16 August 2026 and can be found at https://www.gov.uk/government/consultations/requiring-paymentof-vat-and-paye-return-liabilitiesbydirect-debit

 If you have queries or face problems with these tax reporting requirements, please contact us. We are here to help.
 
Funding and support for biotech start-ups
The Biotechnology and Biological Sciences Research Council (BBSRC) and the Science and Technology Facilities Council (STFC) DeepTech Catalyst Bio programme is open for applications. It supports early-stage biotechnology businesses in developing products and accessing markets.

Successful applicants receive:

• £50,000 in research and development (R&D) funding.
• A £10,000 innovation voucher for R&D activity.
• Technical, commercial, business and intellectual property support.
• Access to investors, customers and sector networks.
• Use of UK Research and Innovation (UKRI) campuses.

Applications will be taken from businesses that are UK-registered and less than five years old, are majority-owned by founders and employees and have previously received support from BBSRC, UKRI, Innovate UK, or a UKRI-supported accelerator.

The product or service must be based on bioscience innovation within BBSRC’s remit, be beyond the concept stage and address a clear market opportunity.

Eligible technologies must be biological in nature, interact with biological systems, or address a biological challenge. Applications focused solely on medical or clinical devices, therapeutics or diagnostics are not eligible.

Businesses interested in applying can find out more at https://iuk-business-connect.org.uk/opportunities/deeptech-catalyst-bio-2026/
The deadline for expressions of interest is 11:59 pm on 16 August 2026. 
 
New investment for former coalfield areas
It has been confirmed that former coalfield areas in England, Scotland and Wales will get a share of £13.5 million to construct new industrial developments for businesses. 

The money from the Government’s Growth Mission Fund will pay for half of the construction costs of new industrial developments that will house Small and Medium-sized Enterprises. The Coalfields Regeneration Trust - a charity dedicated to creating jobs and injecting growth into coalfield areas - will fund the other half.

The funding will support entrepreneurs in those areas who want to start their own business or business owners who want to expand their company in their home town. Subject to approval of the final business cases, the six areas set to receive funding are:

• Cowdenbeath (Perth Road): 51,000 square feet of light industrial units will be built along with a substation and 87 car parking spaces. 103 jobs will be created on site, with hundreds more supported.
• St Helens (Robins Lane, Sutton Fold): 32,000 square feet of light industrial units will be built alongside 54 car parking spaces. 64 jobs will be created on-site.
• Thoresby (Thoresby Vale Colliery): A 22,500 square foot industrial development is proposed once the site is purchased – expected later this summer.
• Ashington (Ashwood Business Park): A 49,500 square foot industrial development is proposed once the site is purchased. The sale is expected to be completed later this summer.
• Resolven (Vale of Neath Business Park): A 30,000 square foot industrial development is proposed once the site is purchased and planning permission secured.
• Seven Sisters (Nant y Cafn Business Park): A 45,000 square foot industrial development is proposed once the site is purchased and planning permission secured.

Once complete, sites will be self-sustaining, with rent revenue reinvested into the local communities. 

26th June 2026 – 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

Mandatory payrolling now to be phased in
The announcement of mandatory payrolling for Benefits In Kind was originally expected to start in April 2027, but following industry pressure, it will now be introduced in two phases. 

Phase 1 will continue to be rolled out from 6 April 2027, with Phase 2 starting a year later on 6 April 2028. The move to mandatory payrolling will replace the current P11D process for most benefits and move it to real-time processing through a company’s payroll system.

Employers providing employee benefits must provide taxable values through payroll in real-time and apply Income Tax and Class 1A NICs through payroll rather than submitting yearly P11D forms.

Phase 1 of mandatory payrolling from April 2027 will include: company cars, car fuel, vans, van fuel and employer-provided medical benefits. 

Phase 2 from April 2028 will include most other Benefits In Kind except beneficial loans and living accommodation. These will continue to be voluntary.

Further guidance is expected by July 2026. 

If you need any help with the mandatory payrolling changes, please give us a call. We would be happy to help you.
 
Watch out, watch out, HMRC’s about
“Owners of dodgy shops that are evading tax: we are coming for you,” said Dan Tomlinson, Exchequer Secretary to the Treasury, as he announced that HMRC will make 30,000 high-street ‘interventions’ in the coming year as part of an initiative to tackle tax fraud and illegal activity.

Effectively, it is an aggressive campaign against vape shops, barbers, sweet shops and convenience stores from being used as fronts for criminal activity.

“Too many high streets have been blighted by illegal activity that harms local communities and undercuts honest businesses, and we’re determined to fix this. This is a sustained, nationwide effort, and HMRC and its partners will use every power available to dismantle these criminal networks,” added Mr. Tomlinson.

The new 350-strong team of criminal investigators to tackle evasion by small businesses, announced during the Autumn Budget 2025, has now been recruited.

To illustrate the work this team is carrying out, unannounced visits were made to six souvenir shops in central London last week involving representatives from HMRC, Home Office Immigration Enforcement, Westminster Council Trading Standards and the Metropolitan Police.

As a result, HMRC will continue tax compliance enquiries, the Home Office made three arrests for immigration-related offences and Trading Standards seized goods worth £5,433.

Businesses and activities that are being targeted include:

• Cash-intensive businesses that may be associated with illegal activity.
• Businesses engaged in money laundering and in breach of National Minimum Wage rules.
• Businesses selling illicit goods such as vapes and tobacco.
• Rogue directors who repeatedly shut businesses and reopen elsewhere (phenoxism).
• Providers and users of electronic tools that manipulate sales records to launder money or suppress sales at the till.

HSE plans guidance for robotics in the workplace
The Health and Safety Executive (HSE) and the Regulatory Innovation Office (RIO) have begun work on the safe and responsible adoption of robotics in the workplace.

Announced at London Tech Week, the project has been co-designed with industry to clarify regulatory requirements and support businesses in increasing the use of robotics.

HSE will work with Automate UK and the Manufacturing Technology Centre (MTC) on guidance on how collaborative robots (cobots) can safely work alongside humans.

The first stage, launching this summer, will deliver regulatory clarity for cobots. It will give industry confidence in how they can ensure robots can work safely alongside humans.

Andrew Curran CBE, Director of Science and Chief Scientific Adviser at the HSE, said, “We understand that despite there being no barrier to adoption in health and safety law, there is a fear of non-compliance, which is limiting adoption. Therefore, we are committed to working with the Regulatory Innovation Office and industry partners to deliver the first joint HSE and industry guidance on the use of cobots to address this barrier and improve business confidence.”
 
High energy bills force a quarter of UK manufacturers abroad
One in four of Britain’s manufacturers has moved production abroad or is seriously considering it, according to research by Make UK, formerly the Engineering Employers' Federation.

The manufacturers’ lobby group said high energy costs have prompted this shift in production, with UK kilowatt-hour charges nearly double those in comparable industrialised countries.  

The survey also found that one in ten companies were outsourcing more production, especially to Southeast Asia, and a further 16% were considering it.

Make UK estimates the average British manufacturer pays around 27p per kilowatt-hour for electricity. It was around 16p for other developed nations, while in the United States, it was as low as 6p.

“A year ago, the big trend was onshoring and bringing back supply chains to the UK. Now companies can’t use UK suppliers because they’re too expensive, so they’re going overseas. We are seeing quite a flight from UK manufacturing because we’re uncompetitive,” said Stephen Phipson, chief executive of Make UK.

He pointed out that on top of the high kilowatt-hour charge, manufacturers also had to pay other levies, the most expensive of which was the climate charge, making them even less competitive than foreign rivals.

The government has introduced the British Industry Supercharger policy, allowing about 450 energy-intensive businesses relief from four of those levies and the British Industrial Competitiveness Scheme (BICS) that will provide relief to a further 10,000 companies on three of the levies, but not until 2027.

Make UK wants BICS to be introduced immediately and to all manufacturers.
 
Only 20% of small businesses use AI regularly
A new report has revealed that only one in five small businesses use Artificial Intelligence on a regularly. Of those that did, they were dominated by telecom and technology companies.

Based on a survey of 1,320 ‘micro’ and small businesses, the ‘UK SME Digital and AI Adoption: The state of play in 2026’ report found that only six per cent have embedded AI into their daily work.

The report was compiled by Enterprise Nation’s Tech Hub in partnership with Google, Sage, Dell Technologies and Square.

How the technology was viewed varied across geographic areas and the size of the company. It also offered contradictory data.

Although only 21% of those surveyed used AI regularly, 57% described themselves as highly or moderately digital.

In terms of sector, 74% of information and communication businesses used AI to some degree, while only four and one per cent, respectively, for the construction and agricultural sectors.

Of those firms that had adopted AI early, 65% said their use increased in the past year. The report concluded that early adopters were likely to pull ahead of competitors.

The report warned that the smallest businesses were at the greatest risk of being left behind, with only 34% of one-person businesses using AI at all. Sixty-eight per cent of companies with 50-249 employees, on the other hand, did use AI.

When asked about what held them back from adopting AI:

• 53% said cost.
• 46% cited lack of skills.
• 38% had concerns about privacy and data.
• 37% had a lack of time.

In geographic terms, 30% of London and 27% of Scotland’s Small to Medium-sized Enterprises (SMEs) used AI regularly, compared to only 10% in the North East of England and 6% in Northern Ireland.

Shockingly, the report found that 22% of SMEs in the North East were digitally excluded, with 22% of them mostly offline.

A PDF copy of the report can be found at https://a.storyblok.com/f/102007/x/ec83d6c6a3/digital-and-ai-adoption-among-uk-smes.pdf 

19th June 2026 – 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

Companies House to bring in changes to accounts filing from April 2028
Companies House will introduce changes to accounts filing due to governmental reforms under the Economic Crime and Corporate Transparency Act 2023 (ECCT Act 2023).

The changes will now come into effect from April 2028, rather than April 2027, to give companies more time to prepare.

The reforms include requiring small companies and micro entities to file profit and loss accounts with Companies House as other companies do. They will have the option to opt out of publishing this information on the public register.

As with Making Tax Digital, companies will be required to file annual accounts via commercial software.

The new rules will introduce additional limitations, including removing the option for companies to file abridged accounts and reducing the number of times a company can shorten its accounting reference period. There will also be a strengthened eligibility statement for all companies claiming an audit exemption and a requirement that the component parts of the accounts and reports be filed together.

Companies House will contact all companies via their registered email address to tell them about these changes and signpost available guidance.

Although transparency and data clarity were prime factors in the planned changes, allowing small companies and micro-entities to opt out of publishing their filed profit and loss accounts protects their privacy and mitigates commercial risks.

Software-only accounts filing
From April 2028, Companies House will require all UK-registered companies to file their accounts in Inline eXtensible Business Reporting Language (iXBRL) format by using commercial software. This applies to companies that file their own accounts and those using third-party agents or accountants to file their annual accounts. Web and paper-based filing systems will be closed for account filings.

The full details of changes will be confirmed in due course but are likely to increase the operating costs of small businesses.

To select a software provider, Companies House recommends using the interactive list of software providers on GOV.UK. 

https://www.gov.uk/software-company-accounts

AI chatbot for government queries
The government has made a new Artificial Intelligence (AI) tool available on the GOV.UK app called GOV.UK Chat. It draws on official government guidance, including tax, to answer questions. 

According to the government press release, GOV.UK Chat is an Artificial Intelligence (AI) chatbot designed for people to ask questions in plain language and receive instant, clear and 'reliable' answers drawn from official government information. The aim is to reduce demand for helpline services and speed up searches for information on the GOV.UK website.

Users of the AI chatbot will be able to get answers on a range of subjects, including tax. It is important to note GOV.UK Chat has limitations. While it uses HMRC guidance on the GOV.UK website to source answers to tax questions, it does not source information from HMRC's manuals.

This makes it unlikely to be useful beyond answering basic tax questions.

Businesses should also be aware that GOV.UK Chat is only available on the GOV.UK app. This means any use by your staff that is related to your business will likely be on their personal devices using personal logins, which could raise privacy and data security concerns.

Additionally, as with any AI tool, the answers given may not be accurate or complete and 'hallucinations' can cause AI tools to present incorrect responses as fact.
  
Snapshot of entry-level hiring in the UK
LinkedIn and the AI & the Future of Work Unit are partnering to investigate the structural forces shaping labour market outcomes. The initial brief provides a snapshot of hiring data for entry-level and more senior positions in the UK.

There is increasing concern that opportunities for those entering the workforce are narrowing. Since entry-level hiring shapes the long-run composition of the workforce, it will affect the supply of skilled workers for years to come.

Some of the early conclusions may come as a surprise. Entry-level hiring is falling in step with the broader market. Averaged across industries, the entry-level trajectory closely mirrors all senior roles.

Since the post-pandemic hiring surge, the UK’s hiring rate has turned negative. As of April 2026, it sits at minus 14% year-over-year, with every tracked industry in decline. However, not all entry-level roles are declining. Of the 38 UK entry-level occupations above LinkedIn’s minimum hiring threshold in April 2026, 30 are declining with only eight growing. 

The analysis found that information-processing roles are weakening while relational roles are growing. The disconnect is not about whether candidates are skilled, but about whether they are skilled in the ways employers currently demand.

The steepest declines are concentrated in information-processing and professional roles:

• Software Engineer (–27%).
• Graphic Designer (–28%).
• Accountant (–29%).
• Product Manager (–24%).
• Data Analyst (–15%).
• Legal Assistant (–14%).
• Data Engineer (–11%).

The strongest growth is in sales and customer-facing roles: Retail Assistant (+25%), Sales Development Representative (+17%) and Business Development Representative (+16%).

The full report can be found at: https://www.gov.uk/government/publications/entry-level-hiring-in-the-uk-a-snapshot/a-snapshot-of-entry-level-hiring-in-the-uk
 
Solving fundamental challenges in your business
Most business owners will face a moment when something in the business feels persistently, stubbornly wrong. Perhaps sales are stalling, staff keep leaving or cash always seems tight.

These could be described as fundamental challenges. These challenges generally don’t go away on their own and can erode the business if not addressed. How, then, can a fundamental challenge in your business be solved? Let us take you through a method that we have found to be effective.

Step 1 - Identify the real problem
Since you want to avoid treating a symptom rather than the cause, it is worth spending time working out what the real problem is. For example, high staff turnover might seem like a case of not being able to recruit the right people, but the root cause might be unclear role expectations or a poor working environment.

Ask 'why' repeatedly until you get to the root of the problem. A useful way to approach this is to write down the problem in one clear sentence, then challenge each assumption in that sentence.

Step 2 - Define what the problem means to the business
Once you have identified the root problem, the next step is to work out how it's affecting the business. For instance, you could consider:

• What results are you not getting in the business because of this problem? For example, if sales performance is inconsistent and targets are being missed, this is stalling the growth of your business.
• What is the financial effect of not dealing with the problem? That could include the difference to your bottom line and whether some of the business’s borrowing is unnecessary or the cost of lost opportunities.
• How is the problem distracting the business from its long-term objectives? Perhaps there is no time to do meaningful strategic work because too much time is lost on firefighting.

This step helps you to quantify the effect the problem is having on your business. Sometimes it can reveal that a problem has less of an effect than you thought. It may be more productive to put effort in elsewhere. On the other hand, once you are clear how much a problem is holding your business back, you gain the motivation to sort it out.

This step also provides you with clarity. A vague problem stays unsolved, whereas when a problem and its impact are clearly defined, it can be tackled more easily.

Step 3 - Identify the system needed to solve the problem
Most fundamental business problems exist because a reliable system is absent. So, give some thought to what type of system, if introduced, would make it difficult for the problem to continue happening. For example:

• A people system involving set hiring criteria, an induction process and regular appraisals of staff turnover.
• A sales system with pipeline management, scripts or set processes and accountability for inconsistent revenue.
• A financial system including cash flow forecasting, debtor management and payment terms for cash flow problems.

Step 4 - Design the system
Having identified what type of system can help, the final step is to design that system so that it works for you.
You will need to decide who will design the system and what the main steps might be. What forms and documents will be needed to operate the system? Will any employee training be needed to get the system up and running effectively?
Conclusion

Fundamental challenges rarely solve themselves. If they are approached methodically, you can find the solution and help your business to continue growing.

If you would like a structured way to work through this process, we have put together a Fundamental Challenges Worksheet that guides you step-by-step, from pinpointing the real problem to mapping out the system that will solve it. To request your free copy, simply get in touch, and we will send it straight to you.
 
Delayed payments and rising costs see Britain’s builders tottering on collapse
A new report has concluded that late payments and rising costs are crippling Britain’s construction sector. Firms already in or at risk of financial distress make up more than eight in ten companies.

The report, Fixing the Foundations, was based on a survey of senior financial managers of property and building companies in the UK, and it found worrying trends.

• 93% report late payments from clients, contractors or supply chain partners, running an average of 53 days overdue.
• One in five (20%) firms now finance their own projects while they wait to be paid.
• 18% say late payments represent one of the single biggest threats to their business.

Rising costs are also a significant problem hitting profit margins. Inflation factors such as COVID, higher employment costs, the Russian invasion of Ukraine, the Middle East conflict and unpredictable US tariffs have not only increased costs but also delayed projects.

For contracts that were signed before climbing inflation, one in five companies have seen seriously reduced profitability and a further 18% say some have been delayed to the point of no longer being profitable at all.  

Another serious concern included supply chains, according to the report’s publisher, Menzies. 18% were not confident that their business could survive a single insolvency or change in the supply chain.

If you would like help with cash flow analysis and prompt payments, just let us know. We can look at your numbers together and ensure you are prepared.
 
New concierge service and visa scheme unveiled for UK’s fastest-growing firms
London Technology Week saw the government make a series of announcements aimed at supporting Britain’s high-growth business sectors.

The Chancellor, Rachel Reeves, announced two new schemes, including visa fee reimbursement for scale-ups in digital and tech, life sciences and clean energy and allowing the Office of Investment to offer fast-track referral for a UK Expansion Worker sponsor licence.

Both measures are intended to help high-potential international businesses set up in the UK more quickly and help UK firms attract exceptional skills, boosting competitiveness.

The measures come hand-in-hand with the Department for Business and Trade announcing a bespoke concierge service for Britain’s fastest-growing companies. Details of the new concierge service remain vague but entail offering support services that will be ‘joined up’.

The government is now looking for a private sector partner to run a pilot to strengthen the UK’s scale-up pipeline.

Targeting ‘the most promising scale-ups’, its official role will be tiered support to unlock deals, unblock delays and create jobs, growth and opportunity for businesses across the UK. It will be supported by the Global Talent Taskforce.

A year ago, the government invested £54 million in the launch of its Global Talent Taskforce, set up to attract ‘world-class’ researchers and their teams to the UK by covering relocation and research costs over five years.

Whether the challenge is regulation, access to finance, procurement, another barrier to growth or access to global talent, the new service’s role will be to ensure government acts quickly and decisively.
 
Small businesses get helping hand with strengthened debt advice
A new £4 million funding boost has been given to business debt advice services to help small businesses and the self-employed. The funding will go towards expanding access to expert support to help them get back on track, giving a leg up to an additional 16,000 businesses over the next three years.

This is building on the existing Business Debtline service run by the Money and Pensions Service.

The new funding will support the government’s Plan for Small Business that helps small businesses access the tools and support they need. This modernisation fund will allow them to spend more time helping their clients, particularly in complex cases that may need additional support.

11th June 2026 – 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

Why every growing business needs a business plan
You have the idea, the energy, and maybe even your first customers. So why slow down to write a business plan? It can seem like something banks ask for, but not something that really helps you run your business.

However, for small and growing businesses, a well-crafted plan is not red tape. It is one of the most practical tools you can have to grow your business.

A plan forces clarity
Day-to-day, running a business makes for a busy work life, and this can stop you from properly considering some vital questions. For instance, where exactly is your revenue coming from in 12 months? What happens if your biggest customer leaves? How much working capital do you need?

Writing a business plan forces you to answer these questions. The process of articulating your market, your competitors, your pricing and your costs often reveals assumptions you had not realised you were making. That clarity is very valuable and can make a significant difference to your day-to-day decision-making.

It aligns your team
As businesses grow, it becomes more difficult for everyone in the business to work towards the same goals.

A business plan gives everyone a shared reference point: the direction the business is going, what the goals are and the reasoning on key decisions.

A concise, well-structured plan covering your value proposition, target market, financial projections and key milestones can help your team to keep working towards common goals as the business expands.

It's essential for funding
Whether you're approaching a bank for a business loan, pitching to investors, or applying for a grant, a business plan is almost always required.

A strong plan lets lenders and investors know that you understand your business deeply. It allows you to show not just the opportunity, but also how you will manage the risks.

A clear, realistic, well-evidenced plan helps you to stand out. It also protects you. The discipline of putting forecasts and projections together often reveals whether funding is the right choice for your business.

It becomes your measuring stick
A business plan can be a living document that you return to regularly.

You can compare where you said you would be against where you are. For instance:

•    Are sales higher than you forecast? If so, you can find out why and do more of it.
•    Is it taking longer than expected to find customers? You have an early warning sign that you can act on.

Comparing your plan to reality allows it to become a management tool to help you make better decisions.

Start simple
When urgent tasks demand your attention each day, taking time to write a business plan may seem too much. However, for businesses that are serious about growing, the thinking needed to put together a business plan is never wasted. Start with a single page covering your business model, your target customers, your competitive advantage and your key financial assumptions. Build from there.

If you would like help to craft a business plan to enable your business to grow, why not ask us about our business plan workshop and practical tools? We would be happy to help you!

CMA finds petrol stations are not taking advantage of Middle East conflict
The Competition and Markets Authority (CMA) has released its latest monitoring report that looks at how the Middle East conflict is affecting fuel prices and assesses fuel margins.

The CMA’s analysis of April concludes that wholesale costs are the main reason for increases in prices and that retailers are not actively changing their pricing strategies to take advantage of the crisis. However, since supply conditions have improved, they note that they would be concerned if the current high prices persist.

A minority of retailers had increased their margins in March. The CMA has investigated this and determined that this was due to price increases by competitors and setting prices to mitigate supply constraints and inventory pressures.

However, the CMA has noted that average fuel margins remain at historically high levels and April saw a slight increase in them. The average is now 11.3 pence per litre, even though inventory and wholesale costs had somewhat stabilised by the end of April.

They conclude that competition in the retail fuel market is weak, with retailers adopting passive pricing policies rather than actively competing to win customers.

The CMA’s Chief Executive, Sarah Cardell, has pointed out that Fuel Finder can help drivers save up to £9 a tank. Fuel Finder allows navigation apps and websites to compare fuel prices so that drivers can locate cheaper petrol.

The CMA has said it will be paying close attention to whether improved supply conditions seen in April are reflected in retail prices. Its next update will be published in August and will consider how the market has developed through to the end of June.

Consultation launched on suspending tariffs on everyday essentials
The government has launched a consultation on suspending tariffs for 125 everyday essential items.

Garlic, avocados, mangoes, nectarines, vegetable oil, baked beans, baked goods, chocolate, sauces, and soft drinks all stand to benefit from targeted cuts to tariffs.

This move would follow the tariff suspension on a selection of agricultural and food products in April 2025.

A suspension of tariffs on certain fertilisers is also being considered to help farmers with rising fertiliser prices caused by the conflict.
The government is seeking views from businesses and other stakeholders on the potential impact of the proposals.

To see full details of the consultation and respond, see: https://www.gov.uk/government/consultations/call-for-input-on-goods-for-cost-of-living-tariff-suspensions/call-for-input-on-goods-for-cost-of-living-tariff-suspensions

Pressure selling tactics ruled to be illegal
A High Court order has confirmed that Emma Sleep, a mattress seller, behaved illegally and broke consumer law by using misleading countdown timers, false ‘high demand’ messages and ‘discount claims’.

Concerns were raised about Emma Sleep in 2022 over behaviour that misled shoppers and pressured them into making rushed purchases. This included the use of discounts, countdown clocks and other claims that urgency was required.

Following the Competition and Markets Authority’s (CMA) investigation, Emma Sleep was taken to court in 2024 for failing to take action to address the CMA’s concerns.

The company has now given binding undertakings to stop its illegal practices and ensure that future claims on its website are clear, accurate and do not create a false impression that people need to act quickly. Emma Sleep will also not be able to use ‘limited time’ sales or discounts where, after the deadline passes, a similar deal continues.

Hayley Fletcher, Senior Director of Consumer Protection at the CMA, said, “Businesses should be clear on what the law says: using fake countdown clocks on misleading ‘discounts’ to push people into spending is illegal.”

The case against Emma Sleep commenced prior to the CMA receiving new powers in April 2025 that allow it to decide independently whether the law has been broken, without having to go through courts. It can now fine companies up to 10% of their global turnover and secure refunds for affected customers.

The CMA is determined to use its powers and has launched investigations into 14 businesses to date. Its investigation of the AA resulted in £4.2 million in fines and £760,000 in customer refunds.

Emma Sleep faces a further trial starting in early June in relation to reference pricing. The CMA has indicated that it is keen to stamp out illegal practices that take advantage of consumers. Hayley Fletcher said, “Our message to businesses is simple - get your house in order or deal with the consequences.”

How can you make AI work effectively for your business?
Artificial Intelligence (AI) continues to make headlines. Anthropic, the company behind chatbot Claude, has filed paperwork in the US to go public. At its last valuation, the company was worth £717 billion.

AI news is not all positive, though. For example, Instagram’s AI chatbot is reported to have been tricked by hackers into gaining access to other people’s accounts.

The BBC ran a feature article last week showing that many businesses seem to be confused about how best to roll out AI.
In some cases, it seems firms are prioritising the use of AI just so that they can say they are embracing it. Other businesses are looking for staff to use AI but are not always clear on why they are adopting it and how they expect to benefit.

Businesses could be wasting effort and missing out on potential gains. What are some practical suggestions you could use in your business to make sure that AI is working for you?

1. Define your objectives
First, consider what your reason for using AI is.

Are you looking to increase profitability so that youcan sell the business? Are you trying to reduce time spent on low-value tasks to increase availability for higher-value tasks?

The clearer you are about why AI is important to your business, the more focused you will be in picking AI tools and promoting their use in ways that will benefit your business.

2. Map your processes before you automate them
Before reaching for an AI tool, document what your current processes actually look like.

If a process is already inefficient or poorly defined, using AI to automate it will often only produce inefficient or poor results faster.

Take time to map out the steps of a process and identify where the bottlenecks are. Then ask whether AI is the right solution or whether a simpler fix might do the job just as well.

3. Start small and measure everything
Pilot AI tools in one team or on one specific task rather than rolling them out across the whole business all at once.

Set clear criteria for what you are expecting to achieve before you begin and then evaluate honestly whether the results justify wider adoption.

What does success look like in concrete terms? Is it hours saved, error rates reduced or revenue generated? If you cannot measure it, you cannot know whether it is working.

4. Get staff onboard
If staff do not understand why a tool is being introduced or how to use it, it is unlikely they will use it effectively.

Anyone using AI tools should be given training on the ethics and risks of using AI, including its limitations. For instance, AI tools can exhibit bias and hallucinate information. They are also designed to flatter the user rather than provide objective information.

Involve staff early in identifying where AI could genuinely help them and make training practical and relevant to their actual role. Staff will be reluctant to use AI if they believe an AI tool is there to replace them, so be clear that the goal is to make their working lives easier, and not to replace them, if that is the case.

5. Assign clear ownership
Someone in the business needs to be responsible for your AI strategy. Without that role being looked after, tools get adopted inconsistently and they are not evaluated properly.

It does not need to be complicated. You might simply need to assign a senior person to take responsibility for reviewing what tools are in use, what they are costing and what they are achieving.
 
6. Review regularly and be willing to stop
AI tools, like any other business investment, should be reviewed periodically. What made sense 12 months ago may no longer be the best option.

Build in a regular review, quarterly or twice yearly, where you honestly assess which tools are earning their place and which are not.

7. Keep human judgment in the loop
AI can process information, generate options and surface patterns that humans might miss. What it cannot reliably do is exercise judgment, take accountability, or understand the nuances of your customer relationships and business culture.

Make sure that important decisions still involve a human who understands the context, and that your team knows when to trust the AI output and when to question it.

Conclusion
The businesses that will get the most from AI are not necessarily those that adopt it earliest or most enthusiastically. They are the ones that have the clearest view about what problem they are solving, the most disciplined about measuring results, and the most honest when something is not delivering.

Continue to treat AI as you would any other significant business investment, with curiosity, rigour and a healthy dose of scepticism. 

Amendments made to 2026 Supporting Small Business Relief
A letter to local authorities confirms amendments that the government has made to the eligibility criteria for Supporting Small Business Relief, a scheme available in England.

Eligibility for the relief has been aligned with the treatment of vacancy and reoccupation under Transitional Relief.

Under the updated rules, a change of ratepayer or a period of vacancy after 31 March 2026 will not affect eligibility for the Supporting Small Business Relief scheme. Eligibility will still be lost if the property becomes occupied by a charity or a Community Amateur Sports Club.

The change has been made to reflect the fact that the relief is intended to mitigate business rate bill increases as a result of revaluation. The change has been backdated to 1 April 2026.

5th June 2026 – 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
 
Introducing the TaxStore® Tax Hub
This week we would like to introduce you to our Tax Hub (https://www.taxstore.com/tax-hub), which provides practical tax guides, resources and information for individuals, landlords, sole traders and business owners.

Whether you are looking to understand your tax obligations, plan ahead for future tax bills or learn more about the reliefs and allowances available, the Tax Hub is designed to make tax simpler and easier to understand.

Featured Articles This Week

How Much Should You Save for Tax?
A practical guide explaining how much individuals, sole traders and business owners may wish to set aside for future tax liabilities, helping to avoid unexpected tax bills and improve financial planning.

Read the article here:
https://www.taxstore.com/how-much-should-you-save-for-tax

Can You Claim for a Home Office to Save Tax?
An introduction to the tax reliefs that may be available when working from home, including the different methods of claiming home office expenses and the key points to consider.
https://www.taxstore.com/can-you-claim-for-a-home-office-to-save-tax

Read the article here:
https://www.taxstore.com/can-you-claim-for-a-home-office-to-save-tax

New tax articles and resources are added regularly, so please bookmark the Tax Hub and check back for the latest tax guides, planning tips and practical advice.

You can explore the wider TaxStore® platform here:
https://www.taxstore.com

GREAT BRITISH SUMMER SAVINGS
On 21 May 2026, the Chancellor, Rachel Reeves MP, announced ‘Great British Summer Savings’, a package of measures aimed at cutting costs for families, particularly those with children. 

The following two measures are of particular importance to businesses:

TAX-FREE MILEAGE RATES
A 10p per mile increase in tax free mileage rates will apply in the 2026/27 tax year, backdated to April 2026. The increase relates to the amount per business mile driven that attracts tax relief and affects both employees and the self-employed. HMRC’s mileage rates guidance has been updated as follows:

For the self-employed:
Vehicle: Cars and goods vehicles – first 10,000 miles
Flat rate per mile for 2026/27: 55p
Flat rate per mile before 6 April 2026: 45p

Vehicle: Cars and goods vehicles – after 10,000 miles
Flat rate per mile for 2026/27: 25p
Flat rate per mile before 6 April 2026: 25p

Vehicle: Motorbikes
Flat rate per mile for 2026/27: 24p
Flat rate per mile before 6 April 2026: 24p

For employees:
Vehicle: Cars and vans – first 10,000 miles
Flat rate per mile for 2026/27: 55p
Flat rate per mile before 6 April 2026: 45p

Vehicle: Cars and vans – after 10,000 miles
Flat rate per mile for 2026/27: 25p
Flat rate per mile before 6 April 2026: 25p

Vehicle: Motorbikes
Flat rate per mile for 2026/27: 24p
Flat rate per mile before 6 April 2026: 24p

Vehicle: Bicycles
Flat rate per mile for 2026/27: 20p
Flat rate per mile before 6 April 2026: 20p

Note that only the rate for cars and vans for the first 10,000 miles has increased; other rates are unchanged.

TEMPORARY REDUCED RATE OF VAT
From 25 June to 1 September 2026, the 5% reduced rate of VAT will apply to the following eligible activities:

•    Children’s meals. To qualify for the reduced rating, the meal:
•    Must be held out for sale as a meal for children.
•    Must be a supply of catering by a restaurant, café or similar establishment and consumed on the premises.
•    Must not be takeaway food.
•    Can include drinks.
•    Children’s cinema, theatre, show and concert admissions tickets.
•    Admission to qualifying attractions that are suitable for children. This includes amusement parks, museums, heritage sites, zoos and soft play areas. The reduced rate applies to all admissions, regardless of the customer’s age.

If you’d like to know more about these measures please get in touch - we can discuss how they may affect you and your business.

DIVIDENDS ON THE 2025/26 SELF ASSESSMENT TAX RETURN 
For taxpayers required to submit a self assessment tax return, new boxes on the 2025/26 employment page form will require the following information for each directorship held by an individual:

•    If the company was a close company;
•    The company’s name and registration number;
•    Dividends the taxpayer received from the close company during the tax year; and
•    The highest percentage shareholding that the taxpayer held during the tax year.

A penalty of £60 may apply for failing to provide the required information. It is therefore important that you notify us of each directorship that you held during the year. In light of HMRC’s recent scrutiny of close company dividends, it will be wise to make sure that dividend procedures are tight, lawful and compliant. Please do contact us if we can assist in this regard.

RESEARCH & DEVELOPMENT: AN UPDATE 
NEW R&D TARGETED ADVANCE ASSURANCE SCHEME
HMRC have introduced a targeted advance assurance service for Research and Development (R&D) tax relief claims. The service, which is a pilot, aims to provide Small and Medium-sized Enterprises (SMEs) with clarity on complex or high-risk areas before a claim is made.

The new targeted scheme is open to any SME wishing to obtain HMRC’s assurance in any of the following areas:

•    Whether the project meets the definition of R&D for tax purposes.
•    Whether overseas expenditure qualifies for relief.
•    Whether the company can claim R&D relief where work is contracted by one company to another.
•    Whether the company qualifies for exemption from the PAYE and National Insurance contributions cap.

The scheme will run alongside the existing full claim advance assurance service, which is only available to first-time claimants.

R&D CLAIMS AT THE FIRST TIER TRIBUNAL
A recent First Tier Tribunal case (Beer Express Ltd v HMRC) demonstrates the pitfalls involved in overreliance on R&D advisers. The FTT’s task was to answer a straightforward question: had Beer Express proved that its projects met the BEIS Guidelines for R&D?
Under those guidelines, qualifying R&D must aim to achieve an advance in science or technology by resolving genuine technological uncertainty - not merely improving a company’s own processes.

The Tribunal found there was no clear explanation of the technological baseline, no defined advance, and no identified uncertainties for any of the projects. 

Instead, the supporting reports were described as vague and unconvincing, offering little more than high-level descriptions.

Equally damaging was the absence of input from a “competent professional” - someone with the technical expertise to explain why the work qualified. Beer Express’s director was found to be honest and credible, but lacked the detailed technical knowledge required.

When HMRC challenged the claims, the adviser who had prepared them had disappeared, leaving Beer Express to defend a case it could not fully explain. 

The FTT dismissed the appeal in full, concluding that Beer Express had failed to discharge the burden of proof required to access R&D relief.

In recent years, HMRC have vastly increased their scrutiny of R&D claims, so it is important to use advisers who are competent in this area.

EMPLOYMENT STATUS OF PROFESSIONAL FOOTBALL MATCH OFFICIALS 
In Professional Game Match Officials Ltd (PGMOL) v HMRC, the First-tier Tribunal (FTT) concluded that football referees engaged by PGMOL were not employees for tax purposes. The decision followed a long procedural history, including appeals up to the Supreme Court, and focused on the correct application of employment status principles.

PGMOL provides referees for professional football matches. HMRC argued that match officials should be treated as employees, meaning that PAYE and National Insurance contributions should have been applied to match fees. 

The case had already been considered by multiple courts. The Supreme Court confirmed that when a referee accepted a match appointment, there was sufficient mutuality of obligation and a framework of control. However, it sent the case back to the FTT to determine the overall employment status using a comprehensive test.

The FTT considered the overall relationship between PGMOL and the referees. Key findings included:

•    No ongoing obligation: PGMOL was not required to offer matches, and referees were not required to accept them. 
•    High level of flexibility: Referees could decline appointments or withdraw without sanction. 
•    Short, discrete engagements: Each match appointment was a separate, limited arrangement. 
•    Limited integration: Refereeing was generally undertaken alongside other full-time work. 

The FTT concluded that, viewed as a whole, the relationship lacked the characteristics of employment. The referees were self-employed, and therefore PGMOL was not required to operate PAYE or account for employer National Insurance on the payments made to them.

This case shows the numerous factors that must be considered when determining whether a worker is employed or self-employed. 
If you have any questions regarding your employment status, or of the status of individuals you engage, please get in touch – we’d be happy to help.

29th May 2026 – 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   Featured TaxStore® Hub: Funding Hub As part of the continued development of our TaxStore® platform, we are continuing to expand our Funding Hub (https://www.taxstore.com/funding-hub), which provides practical information, guides and resources covering business finance, funding options and growth opportunities. Whether you are starting a business, investing in equipment, looking to improve cashflow or exploring finance options to support future growth, the Funding Hub is designed to help you better understand the different funding solutions available. Featured Articles This Week A Complete Guide to Finding and Applying for Funding An overview of different business funding options, including practical guidance on researching funding opportunities, understanding the funding landscape and preparing successful applications. Read the article here: https://www.taxstore.com/funding-hub/a-complete-guide-to-finding-and-applying-for-funding How to Get a Start Up Loan for Your Business A practical guide explaining Start Up Loans, how they work, who may be eligible and how they can help fund a new business venture. Read the article here: https://www.taxstore.com/funding-hub/how-to-get-a-start-up-loan-for-your-business New funding articles and resources are added regularly, so please bookmark the Funding Hub and check back for the latest guides, funding information and business growth resources. You can explore the wider TaxStore® platform here: https://www.taxstore.com

Consultation launched on details for High Value Council Tax Surcharge The government has opened a consultation on the High Value Council Tax Surcharge (HVCTS) expected to come into force in England from 1 April 2028. HVCTS will apply to owners of residential properties in England worth £2 million or more and is payable in addition to the existing Council Tax. It is estimated that the charge will affect less than 1% of properties. The consultation outlines the proposed details of how HVCTS will work in practice, showing how properties will be identified, valued and placed in a band for the surcharge. Here we highlight some of the proposals. How will properties be valued? The Valuation Office will carry out a targeted valuation exercise to identify which properties will fall into the scope of HVCTS. Properties will be placed in one of four bands based on their value. To determine the value of a property and its band for HVCTS purposes, the Valuation Office will look at the sales prices of similar properties as well as other attributes. Revaluations will be carried out every five years, with the next valuation taking place in 2033. Properties built after April 2028 will be valued either on completion or from the day the property is occupied. In most cases, where a property has been significantly improved or changed, it will be revalued when disposed of or when the next general revaluation takes place, whichever is sooner. What type of properties will HVCTS apply to? HVCTS will apply to dwellings, defined as a self-contained unit of residential property used as living accommodation. It will include properties with a mixed-use where the residential element is distinct and self-contained will be included. Gardens, garages and private storage buildings that form part of the dwelling will be included.   Who will be liable for HVCTS? The legal owner of the property, rather than the occupier, will be liable for the surcharge. Where a property is jointly owned, the owners will be jointly and severally liable.  The beneficial owner of a property could be different to the legal owner. For instance, trustees may legally own a property until a minor, the beneficial owner, comes of age. In such situations, it is the legal owner who will be liable for the surcharge. The government has confirmed that trustees will be liable to pay the charge, even in bare trust arrangements. The government is proposing to charge HVCTS to the leaseholder, rather than the freeholder, if the lease they hold is defined as a long lease. This means that the lease was initially granted for more than 21 years, or the law treats it as such. Where the lease is not a long lease the surcharge will be assessed on the freeholder. Are there any exceptions? For eligible individuals, a deferral scheme will be available allowing HVCTS payments to be delayed until the property is disposed of. Proposals show that the deferral will be available to those with income and capital savings below thresholds used in the welfare system, and where the property is the main home of someone who is disabled or severely mentally impaired. Some property types will also be exempted or receive a discount. How will HVCTS be billed? The first HVCTS bills will be sent out in March 2028, and local authorities will collect the payment in the same way as Council Tax. The default will be to make 12 monthly payments, but it will be possible to request 10 payments. Will there be a premium charged to non-UK resident owners? As part of the consultation, the government is also collecting information to explore whether to charge an additional HVCTS premium to non-UK resident owners of homes that are liable for the tax. Is there a way to challenge or appeal HVCTS? Owners who believe that their property band is incorrect or that their property is not within the scope of HVCTS will be able to challenge and appeal the Valuation Office’s decision. The same is true if they receive a bill but do not believe they are the liable person or the bill has been calculated incorrectly. If unhappy with the outcome of the challenge, it will be possible to appeal to the Valuation Tribunal for England.   Consultation timeframe The consultation will run until 14 July 2026. For full details on the consultation and to respond, see the consultation webpage. HMRC introduces targeted advance assurance service for R&D claims Originally proposed in last autumn’s Budget, HM Revenue & Customs (HMRC) have introduced a targeted advance assurance service for Research and Development (R&D) tax relief claims. The service, which is a pilot, aims to provide businesses with clarity on complex or high-risk areas before they make a claim. HMRC are now offering two types of advance assurance for R&D claims. The new service will run alongside the existing full claim advance assurance service. Full claim advance assurance has not been popular and only applies to companies claiming R&D tax relief for the first time. However, targeted advance assurance is open to any eligible small or medium-sized enterprise (SME). The pilot for this service will run until May 2027 and will help HMRC to test demand and decide which parts of the service are most useful to businesses. Companies will now need to choose which advance assurance service they want to use. It is not possible to apply for both targeted and full claim advance assurance for the same period or project. Under targeted advance assurance, companies can seek assurance on: •    Whether a project meets the definition of R&D for tax purposes. •    Whether overseas expenditure qualifies for relief. •    Whether R&D relief can be claimed where work is contracted by one company to another. •    Whether the exemption from the PAYE and National Insurance contributions cap applies. Targeted advance assurance is, however, limited to providing assurance on a maximum of two areas of the R&D work or project for the same period. An application can only include one project and one area of R&D relief. For companies seeking assurance on a second project or area, a second application must be submitted. Requesting advance assurance is not the same as making a claim. A company will still need to make a claim in the usual way. If you think the targeted advance assurance could be useful to you, or you would like help on any aspect of your R&D tax relief claim, please do get in touch. We would be happy to help you! Pensions Commission highlights challenges in retirement saving The Pensions Commission has published an interim report showing that many people are not saving enough for retirement. The report estimates that 15 million people are under-saving for retirement and this could increase to 19 million if no action is taken. Findings in the report include: •    Around half of low and middle-earners are only saving at minimum Automatic Enrolment levels with little else to fall back on. •    45% of working-age adults are not saving into a pension at all. •    Statutory minimum contributions made by employers mainly benefit higher earners. •    Only one in 25 of wholly self-employed workers is saving for retirement. For younger self-employed people, it is even fewer. •    Based on current trends, around three in 10 private pension pots are accessed at the earliest opportunity, with half of all pots taken out in full. Nearly half of these are spent on things like a car, a holiday or renovations. The Pension Commission is looking at why tomorrow’s retirees risk being worse off than today’s and will make recommendations on how to reverse this. A final report will be published in early 2027. Baroness Jeannie Drake, Pensions Commissioner, said: “The recommendations we present in our final report will address the need to secure adequate income in later life and a pension system that is fit for decades to come.” If you would like help with your retirement savings plan, please feel free to get in touch anytime. We would be happy to help you! See: https://www.gov.uk/government/news/britain-is-undersaving-for-retirement-warns-pensions-commission Relief on fuel duty and hauliers get road tax holiday The government have announced some fuel duty and road tax changes designed to help with the increased costs caused by the Middle East conflict.  A 5p fuel duty cut has been in place since March 2022. The relief was due to end between September this year and March 2027. It has now been confirmed that the cut will be extended until the end of the year. Hauliers are being given a 12-month road tax holiday. The normal annual charge of £600 for a typical heavy lorry and £912 for the biggest vehicles will be reduced to £1 at the vehicle’s next road tax renewal. Fuel duty on red diesel will be cut by over a third until the end of the year. This will benefit farmers, rail freight and other red diesel users. See: https://www.gov.uk/government/news/chancellor-protects-drivers-and-businesses-from-rising-fuel-costs Consumer Credit Act to be overhauled for the digital age HM Treasury has announced reforms to the Consumer Credit Act (CCA) to make it suitable for the digital age. The CCA first came into force in 1974 and many of its provisions are now out of date with developments in recent years of technology and consumer behaviour. The reforms will include moving many of the CCA’s detailed, prescriptive requirements out of the law and into the Financial Conduct Authority’s (FCA) rulebook. This will make the rules easier to update as technology evolves. One expected benefit is that those taking out loans, credit cards and overdrafts should be given clearer information about the costs and key terms of their finance, leading to more informed decisions. The reforms will be part of the Financial Services and Markets Bill introduced in the King’s Speech on 13 May 2026. See: https://www.gov.uk/government/news/consumer-credit-act-reformed-to-protect-consumers-and-support-modern-finance Nationwide crackdown on dodgy high street shops A major police offensive was announced last week that will tackle dodgy shops linked to organised crime. Rogue high street businesses will face raids, closures and cash seizures. New police officers are being recruited across the country in an initiative that aims to build intelligence and have more dedicated officers tackling organised crime on the ground. Training will help operatives to identify suspicious businesses. The National Crime Agency estimates that some £12 billion of criminal cash is generated each year in the UK, with £1 billion laundered through high street businesses like mini-marts, barber shops, vape stores and sweet shops. Some businesses are also involved in selling fake goods, tax evasion, illegal working and illegal drug supply. Trading Standards is also set to receive an additional £6 million to bolster its response to sham businesses. A new High Street Organised Crime Unit involving government departments, policing partners and Trading Standards is being set up to help identify what else is needed. Business leaders have welcomed the initiative. Association of Convenience Stores Chief Executive Ed Woodall said: “Local shops tell us that rogue traders on high streets are causing massive damage to their businesses and the wider community, so we strongly welcome this government action to back responsible retailers and crack down on the organised crime gangs that are fuelling illicit trade.” See: https://www.gov.uk/government/news/new-high-street-unit-set-up-in-nationwide-blitz-on-dodgy-shops Independent review commissioned on face-to-face banking access An independent review will consider what needs to be done to protect access to face-to-face banking in the UK. The report’s findings will influence government policy and actions where banking access is at risk. Bank and building society closures continue to make news headlines and many businesses now choose to bank online. However, for businesses and consumers who rely on in-person banking services, the closures are creating some considerable headaches. The independent review will be headed up by Richard Lloyd, who has previously served as a Which? director and a board member of the Financial Conduct Authority. The review will gather evidence on the impact of branch closures, identify who is most affected and assess whether further action is needed to protect access. A report and recommendations are expected by October 2026. See: https://www.gov.uk/government/news/government-reviews-access-to-face-to-face-banking-services UK unemployment rises to 5% but inflation drops to 2.8% Official figures from the Office for National Statistics (ONS) show that the unemployment rate in the three months to March 2026 has risen to 5% from 4.9%.  Combined with a drop in the number of job openings and slowing wage growth, the figures paint an uncertain picture for the labour market in the coming months. Some analysts are suggesting that the figures are showing the effect of the Middle East war on the jobs market. The ONS also reported that inflation fell to 2.8% for the year to April. This compares to 3.3% in the year to March. The drop is largely attributed to lower gas and electricity bills. Analysts still expect inflation to increase over coming months due to the conflict. Some estimates suggest that inflation could reach 4% by the end of the year. Slowing wage growth and increasing unemployment usually create the expectation that the Bank of England will cut interest rates. However, with the jury still out on how the Middle East conflict will impact inflation this seems unlikely in the short term. The Bank of England will next meet to decide on interest rates on 18 June 2026. See: https://www.ons.gov.uk/