27th March 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

How Early Financial Warning Signs Can Protect Your Business from Crisis
In many business failures, a collapse can look sudden from the outside. The underlying problems usually begin months or even years earlier and businesses that avoid crisis are those that spot financial instability early and act on it quickly.

Here, we look at some of the financial stability measures and early warning signs you need to know about for your business.

Cash flow: a key stability measure
A key reason for business failure is running out of cash, not lack of profitability.

“Lock-up”, which is the time between starting work or buying stock and invoicing and receiving payment, is a critical measure for any business holding stock or dealing with work-in-progress (WIP) and credit terms.

If lock-up is high or increasing, the business will eat into cash reserves or become more reliant on overdrafts. This weakens its ability to cope with unexpected shocks.

When stock, WIP or debtor days are rising, it does not automatically mean something is wrong, but it might indicate that:

• Projects are not being managed effectively.
• Billing is too slow.
• Demand has dropped, or the business is holding more stock than it needs.
• Credit control is too weak.
• Potential bad debts are accumulating.

Of course, the earlier these issues can be addressed, the better.

Borrowing and debt levels
While borrowing to grow the business is normal, borrowing to survive usually points to deeper issues.

If the business is borrowing without any linked investment, using new borrowing to pay off old borrowing, or if you are regularly putting in personal funds to cover day-to-day costs, it is a sign that more cash is leaving the business than it can generate.

The key is to understand why the cash is being used up. It might be slow customer payments, unprofitable work, rising overheads or something else.
Once you identify the cause, you can take targeted action. That might be to tighten credit control, review how work is priced, or cut back on the parts of the business that are costing more than they bring in.

People cost and gross margin
In any business, having too many senior people and not enough productive employees erodes profit. On the other hand, having too few experienced leaders can lead to a lack of control and poor decision-making.

One way to assess whether this may be affecting your business is to compare your total people costs against turnover.

The ideal percentage will vary from business to business; however, higher figures could suggest that:

• There are inefficiencies in how things are being done.
• Work is being under-priced.
• There is too much spare capacity.
• The staffing mix is imbalanced.

Gross margin is equally important. Regularly monitoring this by department, team or area of the business will reveal underperforming areas.

Overheads as a percentage of income
It can be useful to benchmark overheads as a percentage of income and then monitor these percentages.

Over time, you will be able to establish patterns of what is normal for your business  allowing you to more easily spot where costs are ramping up. While the specific percentages will vary by businesses, the principle is universal: if overheads grow faster than turnover, margins shrink and the resilience of your business weakens.

Non-financial warning signs
Financial instability rarely appears on its own. You might notice other red flags, including:

• Staff turnover increasing.
• A rise in complaints or service failures.
• Changes in sales patterns.
• Key suppliers tightening their credit terms.

If you would like help setting up Key Performance Indicators (KPIs) or interpreting their trends, benchmarking your results against similar businesses, or identifying potential issues, please do get in touch. We would be happy to help you understand what the numbers mean and work with you to make clear, practical changes that keep your business on a stable footing.
 
Is Your Business Ready for 2026/27?
With 6 April 2026, ushering in the start of the new tax year, there are some changes on the way that may affect how you run and plan for your business. To help you stay ahead, we have highlighted three key updates worth having on your radar.

Making Tax Digital
For an estimated 864,000 sole traders and landlords, the new tax year marks the beginning of Making Tax Digital (MTD) for Income Tax. Many more will follow in April 2027 and April 2028.

Sole traders and landlords with gross income above £50,000 in 2024/25 will be mandated into MTD from April 2026. Being within MTD will mean keeping digital records and using software to submit quarterly updates to HM Revenue & Customs (HMRC), as well as an end-of-year tax return.

MTD will be a significant change in how income tax responsibilities are handled, and it pays to be as prepared as possible.
There are some limited exemptions available. Some are provided automatically, whereas others need to be applied for.

If you will be within MTD from April 2026, you should have received a letter from HMRC telling you this and explaining how to sign up. Please note that you will not be automatically signed up. This is something you need to take care of.

We are already working behind the scenes on a new solution to support our clients through the transition to MTD and will be sharing more details very soon.

Reduction in capital allowances
The main rate of writing-down allowance (WDA) is being reduced to 14% (previously it was 18%). This means you will get less relief on assets your business owns that are being given tax relief in this way.

However, a new 40% first-year allowance (FYA) was introduced in January 2026, and the annual investment allowance continues to apply. These allowances mean that it should be possible to gain favourable tax relief on many new asset purchases.

If you are considering a purchase and would like to ensure that tax relief that will be available to you, please contact us and we will be happy to advise you.

CIS rules become more stringent
Changes to the construction industry scheme (CIS) from 6 April 2026 will give HMRC increased powers.

If a business knows or should have known that a CIS-related payment was connected to fraud, HMRC will be able to:

• Immediately remove gross payment status from the business.
• Make the business liable for the tax loss.
• Charge penalties to the business or the officers of the business.

The time limit for reapplying for a gross payment certificate after its removal will be increased from one year to five years.

These changes underscore the importance of remaining compliant with CIS.

If you would like help staying compliant with tax or to see whether there are ways to optimise your tax position for 2026/27, please get in touch. We would be happy to help you!
 
UK Economy: Zero Growth in January
The Office for National Statistics (ONS) has reported that gross domestic product (GDP), a measure of how the economy is doing, showed zero growth in January, following growth of 0.1% in December 2025.

The ONS said that there was no growth in the services sector in January. It noted that food and drink service activities fell by 2.7%. January is often a tough month for hospitality businesses.

The production sector fell by 0.1%, while the construction sector grew by 0.2%.

Interestingly, GDP has grown by 0.2% over the three months to January. Looking at GDP on a three-monthly basis can be a less volatile measure to compare against than the monthly figures.

The Prime Minister Keir Starmer has already warned that the longer the Middle East conflict continues, the more likely the UK economy will be affected. Increases in oil prices are already being felt and added pressure on inflation is likely to delay interest rate cuts that were otherwise expected.

See: https://www.bbc.co.uk/news/articles/c75e06e0kd7o
 
CMA Steps Up Plans to Monitor Petrol and Diesel Prices
In response to the Middle East conflict, the Competition and Markets Authority (CMA) is stepping up its monitoring of petrol and diesel prices.
Formal requirements for fuel stations to supply revenue, costs and sales data are being brought forward. The CMA will then review the fuel margins made since the conflict began.
The CMA have also said that they will be looking at how quickly prices rise and fall as wholesale costs change. They will be looking for ‘rocket and feather’ pricing, which is where prices increase rapidly but come down slowly.
It is hoped that bringing forward these measures will help ensure that petrol stations are not exploiting the current situation.

 
Executive Director for Markets Juliette Enser said: “Whilst price increases might be inevitable because of rising wholesale costs, it is important that those increases reflect genuine cost pressures. We will be closely scrutinising and reporting on what’s happening with fuel prices and call out any concerning behaviour.
See: https://www.gov.uk/government/news/cma-steps-up-monitoring-of-petrol-and-diesel-prices
 
FCA Tells Second Charge Mortgage Firms to Raise Standards
The Financial Conduct Authority (FCA) has told lenders and brokers in the second charge mortgage market that they need to look at how they advise customers, assess affordability and charge fees.

A recent review by the FCA found issues that raise concerns about whether firms are meeting expectations under the Consumer Duty. Issues identified include:

• Overlooking key living expenses when doing affordability assessments.
• Advising customers to consolidate debt when it was not appropriate for them.
• Record keeping that is inadequate.
• Fees, often added to loans, that are unclear.

While second charge mortgages are a small proportion of the total mortgage market, it is often those who have high existing levels of debt and low financial resilience who are looking for this type of finance.

The FCA’s executive director of payments and digital finance, David Geale, said: “The second charge market is relied on by people often already heavily in debt. It’s vital it works well, but we’ve found that standards are not always where they need to be. This needs to change.”

The FCA is continuing to work with the businesses it reviewed to improve their standards. However, they are calling for all lenders and brokers who deal with second charge mortgages to take note of the review’s findings.

See: https://www.fca.org.uk/news/press-releases/second-charge-mortgage-firms-told-raise-standards-consumers
 
Is Faster Broadband Coming to your Premises?
A new GOV.UK service allows businesses and individuals to find out whether their address is due a broadband upgrade. By entering your postcode, you can see whether your premises or home is covered by rollout plans.

The government’s Project Gigabit initiative is aiming to achieve 99% gigabit coverage by 2032. Rural communities, in particular, have to deal with slow internet speeds and this can make doing business in those areas challenging.

If your premises are not covered by a current plan, the checker will redirect you to Ofcom so that you can see which broadband suppliers are active in your area. You could then contact them to register your interest in an upgrade, which may help them to assess demand in your area and inform future rollout plans.
If you struggle with a slow internet connection, it could be worth using the checker to find out whether upgrades are available in your area.

To use the checker, see: https://www.gov.uk/guidance/check-your-gigabit-broadband-availability

20th March 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

MAKING TAX DIGITAL FOR INCOME TAX
Making Tax Digital (MTD) for income tax is the new regime for self-employed individuals and landlords that will start to apply from April 2026 if they have business and/or property income (i.e. total takings, not net profits) of more than £50,000 per annum. The regime requires digital record-keeping and quarterly updates to HMRC, with the first such update due by 7 August 2026.

Last month, HMRC published a press release to confirm that the changes will affect 860,000 individuals. They are keen to encourage action now and to highlight the benefits of spreading tax compliance administration throughout the tax year.

If you are one of the 860,000 individuals moving into the new regime from April 2026, HMRC are also keen to stress that a normal annual tax return will still be required for the tax year to 5 April 2026. This means that in addition to providing HMRC with quarterly updates on the year to 5 April 2027 during that tax year, your annual 2025/26 tax return will still need to be filed by 31 January 2027.

We are already working behind the scenes on a new solution to support our clients through the transition to MTD and will be sharing more details soon

OVERPAYMENT RELIEF FROM HMRC
If you have paid too much tax, perhaps because you made an error on a return, or because you believe a sum determined by HMRC as being due is incorrect, there is a general rule that a refund cannot be claimed more than 4 years after the end of the relevant tax year. For example, a refund claim in relation to the 2021/22 tax year would need to be made by 5 April 2026.

However, if you do believe you’ve paid too much tax in the past, you may be able to claim it back through a mechanism known as “overpayment relief”. This is a formal claim made to HMRC, and it serves as a vital safety net. Understandably, HMRC checks on any such claims are thorough and a number get rejected.
HMRC has recently updated its guidance to help individuals successfully claim back any tax monies owed. In particular, overpayment relief claims must be made in writing and must state:

• that the claim is for overpayment relief
• the tax year for which the claimant thinks they have paid too much tax, or too much tax has been assessed
• why too much tax has been paid or assessed
• how much has been overpaid or over-assessed
• if an appeal has, or has not, been previously made for the same payment or assessment (the term “appeal” must be used)

The claim must also include a declaration saying the details given are correct and complete to the best of the information and belief of the person making the claim and it must be signed by them personally.

Undertaking the right steps in the right order is critical and we would be pleased to support with this, should you believe you have paid too much tax.

ADVISORY FUEL RATES FOR COMPANY CARS
HMRC have published new advisory fuel rates from 1 March 2026. These are the suggested reimbursement rates for employees' private mileage using their company car. Where the employer does not pay for any fuel for the company car, these are the amounts that can be reimbursed in respect of business journeys without the amount being taxable on the employee.

The petrol, diesel and home charging rates have remained static this quarter, while the LPG and public charging rates have changed. 

The new rates per mile are:

1400cc or less
    •    Petrol: 12p (12p)
    •    Diesel: 10p (11p)
    •    LPG: –
    •    Electric (Home charger): 7p (7p)
    •    Electric (Public charger): 15p (14p)

1600cc or less
    •    Petrol: –
    •    Diesel: 12p (12p)
    •    LPG: –
    •    Electric (Home charger): 7p (7p)
    •    Electric (Public charger): 15p (14p)

1401cc to 2000cc
    •    Petrol: 14p (14p)
    •    Diesel: –
    •    LPG: 12p (13p)
    •    Electric (Home charger): 7p (7p)
    •    Electric (Public charger): 15p (14p)

1601 to 2000cc
    •    Petrol: –
    •    Diesel: 13p (13p)
    •    LPG: –
    •    Electric (Home charger): 7p (7p)
    •    Electric (Public charger): 15p (14p)

Over 2000cc
    •    Petrol: 22p (22p)
    •    Diesel: 18p (18p)
    •    LPG: 19p (21p)
    •    Electric (Home charger): 7p (7p)
    •    Electric (Public charger): 15p (14p)

Previous rates are shown in brackets.

*Fully electric cars only. Note that for hybrid cars, you must use the petrol or diesel rate.

You can also continue to use the previous rates until 31 March 2026.

Employees using their own cars
For employees using their own cars for business purposes, the Advisory Mileage Allowance Payment (AMAP) tax-free reimbursement rate continues to be 45p per mile (plus 5p per passenger) for the first 10,000 business miles, reducing to 25p per mile thereafter.

Input VAT
Within the 45p/25p AMAP payments, the amounts in the above table represent the fuel element. The employer is able to reclaim 20/120 of the fuel amount as input VAT provided the claim is supported by a VAT invoice from the filling station. For a 1300cc petrol-engine car, 2p per mile can be reclaimed as input VAT (12p x 20/120).

EMPLOYER-PROVIDED VEHICLES AND TAXABLE BENEFITS IN KIND
On the topic of company cars, it should be remembered that as we head into a new tax year, the flat-rate figures used in the computation of some employer-provided vehicle benefits-in-kind calculations will be increased for inflation. From 6 April 2026:

• The flat-rate van benefit charge will be increased from £4,020 to £4,170.
• The flat-rate van fuel benefit charge will be increased from £769 to £798.
• The multiplier for the car fuel benefit charge will be increased from £28,200 to £29,200.

Where an employer provides an employee or a director with a company car, this is usually a taxable benefit-in-kind. The taxable amount of the benefit depends on the vehicle’s power supply, its manufacturer's list price and CO2 emissions. A reduction is given for any periods where the car is unavailable.

Pool cars owned by the employer and used by a number of employees will not normally lead to a taxable benefit-in-kind. Certain conditions need to be met, including the car only having very low or incidental private use and it being used by different employees, none of whom normally take it home at night.

Great care needs to be taken with company vehicles and tax. Indeed, in a recent tax tribunal case, a company director learned this lesson the hard way, after relying on an informal agreement reached with HMRC over 25 years earlier. In MWL International Ltd and Maywal Ltd v HMRC [2026], the business had treated a number of cars as pool cars and reported no benefit in kind for over two decades. During a later PAYE audit, HMRC decided the vehicles did not genuinely qualify as pool cars because the conditions had not been properly met. Significant National Insurance bills then followed. The company fought back but the Upper Tribunal ruled that HMRC cannot be prevented from applying the correct tax rules, regardless of any past informal agreement.

The case is a stark reminder that a vehicle must genuinely satisfy all of the pool car conditions in practice, not just on paper, and that an informal nod from HMRC, however long ago, offers no lasting protection.
 
SOURCING LABOUR FROM THIRD PARTIES? DUE DILIGENCE REQUIRED!
Just a final reminder for any businesses sourcing workers from third parties (e.g. through agencies or ‘umbrella companies’) that new rules come into effect from 6 April 2026 that may make you jointly and severally liable for the PAYE and NIC costs of those workers, should the third party fail to pay HMRC. To avoid unexpected tax costs, we strongly recommend that supply chains are reviewed and the new rules are understood.

16th March 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

Starting Up in Business: A Practical Guide
Have you reached a point where the idea of running a business feels like more than just a pipe dream? Perhaps you have identified a gap in the market, you want greater independence or your side hustle is telling you that it has the potential to become a full-time income.

Whatever the motivation, taking some time at the outset to understand the practicalities can make starting a business smoother and help you to avoid costly surprises later.

Here we review some of the things you will want to consider.

Selecting an appropriate legal structure
A first decision for a new business is to choose the structure under which it will operate. In the UK, most new ventures start either as a sole trader (or a partnership if there is more than one of you) or as a limited company.

Each option has advantages and disadvantages, so it pays to consider what the business will be doing, the expected income, and how you want to manage risk and growth before deciding which is best for you.

Setting up accounting and bookkeeping systems
Accurate financial records are essential for monitoring the performance of your business and complying with its legal reporting requirements.

For new businesses, using cloud-based bookkeeping software from day one is often a good approach. Software platforms can now connect directly to business bank accounts and identify expenses from receipts stored electronically. This can be a time saver for you.

Considering VAT
VAT is an area where early planning can prevent unexpected bills. Registration becomes compulsory once taxable turnover exceeds the VAT registration threshold on a 12-month rolling basis or will exceed the threshold in the next 30 days. However, for some businesses, it can be worth voluntarily registering earlier.

VAT registration can affect your cash flow, pricing and competitiveness, so understanding this before you cross the threshold is important.
 
Running payroll
If the business will employ staff, or if you set up as a limited company and want to draw a salary as a director, you will need to run a payroll.

A payroll is easy to set up, but it triggers ongoing and regular obligations, including calculating pay and PAYE tax and national insurance (NI), reporting to HM Revenue and Customs each pay period, issuing payslips, and potentially managing the requirements for workplace pensions.

Tax obligations: income tax and corporation tax
Sole traders pay income tax and Class 4 NI on their profits. One point that often surprises new business owners is the payment on account system, which can make your first tax bill larger than you might expect.

On the other hand, limited companies pay corporation tax on their profits. Directors then pay personal tax on any income taken from the company. This makes it important to consider how funds will be withdrawn from the business, as the tax effect can be significant.

Cash flow planning and forecasting
A business can be profitable on paper but still struggle financially if cash is not available when it is needed. For example, suppliers might need to be paid straight away, but customers do not pay until the end of the month.

Cash flow forecasting can help you predict when money may be tight, and allows you to plan on how to reduce pressure.

Accessing credit and finance
Many new businesses need some form of finance, perhaps to buy equipment or support working capital requirements. Options can include start-up loans, business overdrafts, hire purchase and leasing.

Lenders typically look for a clear business plan. Well-kept records and organised accounts are often a big help in getting approval.

How can we assist?
Clearly, there is a lot to think about when starting a new business, however, help is at hand!

Why not ask us for a copy of our free “New Business Kit”? This is a comprehensive guide to the financial, tax and accounting considerations of starting a business.

Starting a business well can make a significant difference to long-term success, and we are available to help you navigate each step with confidence.
 
Is a Change to Income Tax Devolution in Wales on the Horizon?
An independent report, commissioned by the Welsh government, has examined potential future options for income tax devolution in Wales. It compares keeping the current partially devolved system with moving to full devolution, while factoring in the effects of the block grant adjustment (BGA).

The report, prepared by the Fraser of Allander Institute at the University of Strathclyde and Bangor University, explores four options and their effect on the net tax position of the Welsh government.

The four options are:

• Partial devolution of income tax rates with a BGA calculated on a ‘by-band’ basis. This is the current approach used in Wales.
• Partial devolution of income tax rates with a single BGA.
• Full devolution of income tax rates and thresholds, with a single BGA. This is the current approach in Scotland.
• Full devolution of income tax rates and thresholds, with the BGA calculated on a ‘by-band’ basis.

Currently, the UK government reduces each of its basic, higher and additional income tax rates by 10 percentage points for Welsh taxpayers. Since devolution, the Welsh government has set its own rates of income tax at 10%. This means that Welsh taxpayers pay the same overall amount of income tax as those in England and Northern Ireland.

What is the block grant adjustment (BGA)?
The BGA reduces the amount of grant that is paid by the UK government to the devolved administrations in Wales and Scotland. The reduction is intended to reflect the amount of revenue the UK government would have received in the absence of devolution.

The method by which the BGA is calculated can vary.

• In Wales, where the devolved income tax rates apply to each of the income tax rate bands, the adjustment is separately calculated for each tax band.
• In Scotland, there is a single adjustment to the grant.

The devolved administrations effectively gain (or lose) on the difference between the tax revenues they collect and the amount of BGA that is deducted from their grant. The report, therefore, looks at how sensitive this difference is for the Welsh government under the four options reviewed.

What does the report conclude?
In short, the authors conclude that there is no single optimal model among the four options that were looked at. Each has benefits and drawbacks.

Partially devolved systems offer less control but also reduce how much the Welsh government is exposed to changes outside its control.

Full control of income tax rates and bands would allow the Welsh government greater control over the tax system. However, the report highlights that income tax rates cannot be set in a vacuum.

The report recommends that a decision on changing income tax devolution in Wales would need to balance the government’s risk appetite against a realistic assessment of the possible negative outcomes. Potential changes in UK government policy and how Welsh income tax would interact with UK income tax would also need to be considered.

See: https://www.gov.wales/future-options-for-income-tax-devolution-in-wales
 
Health and Safety Campaign for Home Workers
The Health and Safety Executive (HSE) has launched a campaign to remind employers that they have the same legal duties for home workers as office-based staff.

According to the latest figures from the Office for National Statistics (ONS), over a third of workers in Great Britain now work remotely or in hybrid arrangements, which makes this an important area for employers to cover.

The HSE campaign focuses on three essential areas for employers to pay attention to. These are:

• Stress and mental health.
• The safe use of display screen equipment (DSE).
• The working environment – including accidents, emergencies, and lone working.

HSE advise that it is not necessary to physically visit someone’s home for an employer to fulfil their duties since, most of the time, the risks are low and the steps to manage them are straightforward. HSE suggests that managers:

• Keep in regular contact with their teams.
• Talk openly about workloads and training needs.
• Make sure people aren’t under pressure to work outside their normal working hours.
• Have simple conversations about the staff member’s physical environment by asking them to visually check that their equipment is safe and not damaged, keeping work areas clear of trailing wires or obstructions, and making sure they know what to do in an emergency.

The HSE provides free resources to help businesses carry out home-working risk assessments.

Businesses in Northern Ireland are overseen by Health and Safety Executive Northern Ireland (HSENI). HSE NI’s website also provides free resources to help employers fulfil their legal obligations towards staff working at home.

See: https://press.hse.gov.uk/2026/03/09/home-workers-must-be-protected-like-any-other-employee/
 
Employers: Are You Ready for a New Tax Year?
The end of the 2025/26 tax year will soon be here, which means a few additional tasks to carry out on your payroll, if you run one.

If you run a payroll, you will need to report information on the tax year that is ending to HM Revenue and Customs (HMRC). The tax year ends on 5 April 2026.

You will also need to prepare for the new tax year, which starts on 6 April.

HMRC provide the following handy list of tasks that need to be carried out and when.

• Send your final payroll report of the year on or before your employee’s payday.
• Update employee payroll records and payroll software from 6 April.
• Give your employees a P60 by 31 May.
• Report employee expenses and benefits by 6 July.

If you would like help with any of these tasks, please do get in touch. We would be happy to help you!

See: https://www.gov.uk/payroll-annual-reporting
 
Increases to Intellectual Property Office Fees
The Intellectual Property Office (IPO) has announced increases to its fees for patents, trademarks and designs from 1 April 2026.

The new fees will mean an increase in current charges of 25%. For example, the cost of a patent search will increase from £150 to £200. A trademark application will cost £205, up from £170.

The IPO notes that this is their first fee increase in eight years, with inflation and cost pressures making it necessary to review the charges now.
Fees will be charged up to and including 31 March 2026, which may make it worthwhile accelerating an application to benefit from the lower rates.
Using the ‘save for later’ or ‘draft’ function when applying does not count as submitting an application. This will mean paying the higher charges if the actual submission occurs after April 1.

The IPO has published guidance that will be helpful if you have fees due around 1 April. These will be particularly useful if you are applying for a trademark or registered design.

See: https://www.gov.uk/government/news/intellectual-property-office-fees-to-increase-from-april-2026

Negotiations Underway on a UK-EU Agrifood Trade Deal
A UK-EU trade deal is currently being negotiated, which is hoped will benefit businesses in Britain and Northern Ireland, and make agrifood trade easier, cheaper and quicker.

Exports of food and agricultural products to the EU have seen a fall of 22% since 2018. It is estimated that this represents a real terms loss of £4 billion to businesses.

The Sanitary and Phytosanitary (SPS) agreement, which is at the heart of the deal, will enable the smoother flow of agrifood goods, including plants, from Great Britain to Northern Ireland. It aims to protect the UK’s internal market while maintaining Northern Ireland’s EU access.

Most agrifood goods moving from Great Britain to Northern Ireland will no longer need regulatory certificates, checks or paperwork.

The new trade deal will not affect the Windsor Framework, which protects Northern Ireland’s dual market access.

Businesses in Northern Ireland, particularly, stand to benefit from being able to trade goods without additional paperwork and checks within both the EU Single Market and the UK Internal Market.

The Department for Environment, Food & Rural Affairs (DEFRA) has opened a call for information to find out what can be done to support businesses get ready for the changes. The call for information will run until 23 April 2026.

See: https://www.gov.uk/government/news/businesses-in-northern-ireland-urged-to-prepare-for-smoother-gb-ni-and-eu-trade 
 
 

6th March 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

Spring Forecast 2026: What Does the OBR’s Latest Forecast Mean for You?
During a week dominated by news of the Middle East conflict, on 3 March 2026, Chancellor Rachel Reeves presented the Spring Forecast to Parliament.

The Chancellor told MPs she had “restored economic stability” as she presented the Office for Budget Responsibility’s (OBR’s) economic forecasts.

The Chancellor focused on how the government’s policies are delivering economic growth, particularly when looking at Gross Domestic Product (GDP) per person. However, the OBR’s report indicates a more nuanced picture and notes that the fiscal context for the next Budget will remain challenging.

The OBR’s forecast was being finalised as the conflict in the Middle East escalated. The OBR warned that this conflict could have a “very significant” impact on the global and UK economies.

Summary of economic outlook
The main points from the OBR were:

• Gross Domestic Product (GDP) growth is expected to slow from 1.4% in 2025 to 1.1% in 2026. This is 0.3 percentage points lower than the OBR’s November 2025 forecast. However, GDP growth is expected to pick up to an average 1.6% a year from 2027 to 2030. 
• Real GDP per person is forecast to grow at an average rate of 1.1% a year between 2026 and 2030. This is an indicator of changes in average standards of living and is marginally higher than in the November forecast. 
• The unemployment rate is forecast to rise from 4.75% in 2025 to a peak of 5.3% in 2026. The OBR says this is mainly due to those entering the workforce finding it harder to secure jobs in a period of subdued hiring. They expect the unemployment rate to ease back to 4.1% by 2030, but note that the impact of AI on future employment makes longer-term forecasts less certain. 
• Public sector net borrowing is projected to fall from 5.2% of GDP in 2024/25 to 4.3% of GDP in 2025/26. It is then forecast to decline gradually over the medium term to reach 1.6% of GDP in 2030/31.

As part of the government’s policy of one major fiscal event a year, the Chancellor announced no new tax or spending policies. However, the OBR’s forecasts do provide some early clues about future tax and spending pressures.

What does the Spring Forecast tell us about tax?
From a tax perspective, the OBR’s report points to a tax environment that will feel increasingly heavy over the rest of the decade. Taxes as a share of GDP are projected to climb to 38.5% by 2030-31, a post-war high.

Much of this increase comes from the freeze on income tax thresholds, which will continue until April 2031. Combined with rising wages, this means more people are being pulled into paying higher tax rates, even if their circumstances have not changed.

The state pension creates an interesting complication: from 2027/28 it is expected to exceed the personal allowance, bringing an estimated 600,000 more people into tax in 2026/27 and around 1 million by 2030/31. The government has said it does not intend for pensioners whose only income is the basic or new state pension to pay income tax during this Parliament. However, the final details on this policy and how it will work in practice have not yet been announced.

The OBR notes that the increase in employer national insurance contributions, which took effect last April, is also playing a significant role in the higher tax take. These increased costs are potentially feeding into business hiring decisions at a time when unemployment is forecast to rise to 5.3% in 2026.
Self-assessment payments are also expected to rise sharply in 2026/27, partly due to the non-domiciled tax regime being abolished in 2025/26 and a subsequent temporary repatriation facility being offered. If you have overseas income or assets, it is still important to carefully review your tax planning.

The strong performance of UK equity shares in recent months means that the OBR are expecting receipts from capital taxes to rise. If you hold UK equity shares, this may be a good time to review your holdings and consider whether crystallising gains now, rebalancing your portfolio and/or making use of available allowances would put you in a better tax position. Any such planning needs to carefully navigate what are known as ‘bed and breakfasting’ rules (effectively selling to repurchase), so please do get in touch if this situation applies to you.
 
In conclusion
The practical message from the OBR’s report is that tax planning is becoming ever more important, and capital taxes and transactions are likely to remain on the government’s radar.

For individuals and businesses, this means keeping a closer eye on allowances, thinking about the timing of income and gains, and making sure you are using the reliefs available. Reviewing arrangements such as pension contributions, profit extraction techniques, and the way assets are held within a family may also lead to simple, practical steps that could help to keep future tax bills under control.

Please do talk to us if you would like any personalised help in optimising your tax position.
 
ICAEW Says Stability in the Tax System Needed to Support Entrepreneurship
The Institute of Chartered Accountants in England and Wales (ICAEW) has said that doing business in the UK is too uncertain and expensive, and more stability in the tax system is needed. Their comments were in response to the government’s call for evidence on how the tax system can better support entrepreneurs.

ICAEW considers that blunt tax hikes and tax policies have disproportionately increased the cost base of UK businesses and these need to become a thing of the past.
They also point to a lack of meaningful incentives that would unlock investment from serial entrepreneurs and family office investors. For instance, an outright capital gains tax exemption could be more effective in encouraging the reinvestment of capital into new ventures.

Recent changes to the inheritance tax and domicile rules have also complicated reinvestment decisions and may tempt some to move funds abroad.
From April 2026, the income tax relief that can be claimed by someone investing in a venture capital trust (VCT) will be reduced from 30% to 20%. ICAEW have called for this decision to be reversed.

ICAEW have suggested that changes also be made to the enterprise investment scheme (EIS) and enterprise management incentives (EMI) to make them more effective and attract talent to entrepreneurial businesses.

The government’s call for evidence closed on 28 February 2026. It will be interesting to see what changes come from the consultation.
See: https://www.icaew.com/insights/tax-news/2026/mar-2026/support-entrepreneurship-through-stability-in-the-tax-system-says-icaew
  
Boost in Grants for Installing EV Chargers
The government has announced an over 40% increase in charge point grant amounts that will mean businesses, landlords and renters could save up to £500 on installing an electric vehicle (EV) charge point. Previously, the grant provided a discount of £350.

The uplift could cover almost half the typical installation costs and make it easier for EV users to access cheaper electricity rates at home or work to charge their EV. Schools will also be eligible for grants of up to £2,000 per socket.

Updates to the scheme will also simplify the current EV charge point support schemes available by reducing eight grant types down to five, which should make the system easier to navigate.

The electric car grant, which provides a discount on buying an EV, continues to be available. This can offer savings of up to £3,750.

Support is also available through local authorities for residents who do not have driveways to be able to install discreet, embedded pavement channels, meaning those with on street parking can install an EV charge point. This is in addition to the £500 installation grant.

EVs continue to receive preferential tax treatment, and this can also be worth exploring if you are considering buying a new vehicle.

See: https://www.gov.uk/government/news/grant-boost-to-cover-almost-half-the-cost-of-installing-ev-chargers-for-households-and-businesses
 
How Clear Are Your Prices?
The Competition and Markets Authority (CMA) has launched a Clearing Pricing campaign aiming to encourage businesses to be upfront, transparent and fair in their pricing.

Teaming up with TV and radio presenter Alexander Armstrong, the campaign highlights a ‘Three Step Pricing Check’ businesses can use to make sure their pricing is on the right side of the law.

The three steps are:

1. Show the total price up front.
2. Include all mandatory charges.
3. If you can’t give a total yet, is it clear how customers can work it out?

Under the Digital Markets, Competition and Consumers Act 2024 (DMCCA), it is now illegal to introduce additional mandatory fees, such as a booking or delivery fee, taxes or other charges late in the purchase process.

The Act also gives the CMA the powers to fine businesses that break consumer law up to £300,000 or, if higher, up to 10% of their global turnover.

For businesses that are not clear about the new laws, guidance is available from the CMA that explains how to present prices clearly. The guidance provides examples of what should and shouldn’t be done when it comes to delivery charges, administration and booking costs, and periodic payments and could be a useful resource.

See: https://www.gov.uk/government/news/tv-presenter-alexander-armstrong-teams-up-with-the-cma-to-champion-clear-pricing
 
Youth Guarantee Jobs Fair Launches in Blackpool
The government’s push to tackle long-term youth unemployment took a step forward last week, with more than 3,000 young people and residents attending the first-ever Youth Guarantee Jobs and Careers Fair in Blackpool.

Held at the Winter Gardens, the event brought together 94 employers offering everything from apprenticeships and traineeships to live vacancies. Businesses included both local and national employers. There are plans to hold further events in the future.

The Youth Guarantee aims to ensure that everyone under 25 is offered one of four pathways:

• Employment
• Continued education
• An apprenticeship
• A traineeship, work experience placement or Sector-Based Work Academy Programme (SWAP)

A new review led by Alan Milburn is examining the barriers stopping young people from accessing work.

For businesses, this expanded support for young people may help ease the challenges in recruitment and skills shortages. Apprenticeships can be a cost-effective way to build a pipeline of future employees.

See: https://www.gov.uk/government/news/first-youth-guarantee-jobs-fair-brings-big-employers-together-to-unlock-opportunities-for-young-people
 
Consultation on Major Measures to Protect Children’s Digital Well-being
A major consultation has been launched that explores what measures are needed to keep children safe on the internet. It examines if social media should be banned for children, or whether there should be restrictions on AI chatbot features and overnight curfews.

The government also plans to run pilots with families and teenagers to explore how social media restrictions could work in practice.

The consultation considers a number of changes, including:

• Whether a minimum age should be applied to social media, and if so, what age?
• Whether addictive features, such as infinite scrolling and autoplay, should be switched off by the developers.
• Whether mandatory overnight curfews would help children to sleep better, and if so, what age should they be.
• Whether children should be able to use AI chatbots without restriction.
• How would the enforcement of age verification be strengthened?
• How children and parents can be helped to navigate the digital world successfully.

The consultation is open to industry as well as parents, young people and others who work with children. It concludes on 26 May 2026.

New legislative powers could change how apps, games and other online services are developed and online businesses will want to stay informed to see how the proposals could affect their services.

See: https://www.gov.uk/government/consultations/growing-up-in-the-online-world-a-national-consultation

27th February 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

Spring Statement 2026: What Businesses Should Expect on 3 March
The Spring Statement will be delivered in Parliament on 3 March, giving an update on the state of the UK economy and the government’s financial outlook.

Unlike the Autumn Budget, the Spring Statement is unlikely to be used for big tax decisions. For businesses it is a useful event as it may set the tone for the months ahead and could give early clues about future tax and spending pressures.

What the Spring Statement is
The Spring Statement is built around the latest set of economic forecasts from the Office for Budget Responsibility (OBR). The OBR publishes forecasts twice a year and considers areas such as growth, inflation, unemployment, government spending and tax income.

The OBR also has responsibility for checking whether the government is on track to meet its self-imposed fiscal rules. However, the Spring Statement will not make a formal assessment of this area as this is now only being reviewed once a year, in the autumn.

Even so, the OBR’s numbers are still likely to influence decisions the Chancellor will make later in the year.

What Is Happening
The Chancellor’s speech is likely to begin shortly after midday on 3 March. As soon as the speech is finished, the OBR’s full forecast will be published on the government website.

This is a change from previous practice, where the OBR would publish their forecast on their own website. However, due to the early accidental release of OBR data at last year’s Autumn Budget, controls are being tightened on how and when the forecast is published.

Will There Be Any Tax or Spending Changes?
This seems to be highly unlikely. The Chancellor has made clear that she intends to announce major policy decisions only once a year, at the Budget in the autumn. The idea is to stop the cycle of constant speculation that can affect business planning and household spending.

However, while we are not likely to see new tax rises or cuts in the Spring Statement, we could perhaps see smaller administrative or follow-up measures.

For most businesses though, the real interest will lie in the OBR’s figures, especially inflation, growth and unemployment, as these influence future interest rates and wage pressures and may indicate the likelihood of tax changes later in the year.

For example, persistent weak growth or rising unemployment may increase the pressure to raise taxes or limit spending. Alternatively, if the OBR gives a more optimistic outlook, especially on inflation, it may strengthen the case for interest rate cuts.

In summary, the Chancellor’s speech is not expected to make sweeping policy changes, but her comments could give a sense of how the government sees the economy developing over the next 12-18 months.
 
A Practical Look at the Cycle to Work Scheme for Employers
The Cycle to Work scheme continues to attract interest from employees and employers alike looking to optimise their salary package and perhaps gain a tax break.

Below is an overview for businesses considering running a scheme or reviewing their existing arrangements.

The Basic Structure
The scheme allows an employer to provide a bike and eligible safety equipment tax free to their employees.

This is often done in conjunction with a salary sacrifice agreement where the employee’s gross pay is reduced for a set period to cover the costs. The salary sacrifice means the employee pays less income tax and national insurance, and the employer pays less employer national insurance.

Bikes can be provided in different ways.

• The bike and equipment can be loaned to the employee.
• A voucher can be provided so that the employee can hire the bike and equipment.
• Pool cycles can be made available for the general use of employees.

At the end of the hire period, employees can either continue hiring, return the bike, or buy it at a fair-market-value payment based on HMRC guidance.

Conditions That Must Be Met
To be compliant with the rules:

• The employee must not own the bike during the hire period.
• The bike must be used mainly (>50%) for commuting or work-related travel.
• The scheme must be available to the whole workforce. 

Practical Considerations for Employers
Most employers work with a third-party provider to manage the administration work, although there is no reason it cannot be run in-house.

HMRC does not expect employers to monitor the non-work use employees make of the bike, nor are employees expected to keep detailed records of their bike use to justify how it is being used.

If salary sacrifice is being used along with the Cycle to Work scheme, there is a need to be careful that the scheme still meets the requirement to be available to all employees.

Subject to partial exemption rules, VAT can be reclaimed on any bikes and equipment purchased by the employer.

In Conclusion
Cycle to Work remains a straightforward way for employers to provide tax efficient support to their employees. If you would like personalised advice on whether or how a scheme could work in your workplace, please get in touch. We would be happy to help you!
 
Draft CBAM Rules Published
The government has published the draft secondary legislation for the UK’s Carbon Border Adjustment Mechanism (CBAM), which is due to go live on 1 January 2027. This is an important development for UK businesses importing affected materials.

What is CBAM?
CBAM has already been introduced in the EU and will apply a carbon price to certain imported goods to reduce the risk of “carbon leakage”. This is the concern that emissions-intensive production simply shifts overseas when the UK tightens its own environmental standards.

UK importers of goods from the aluminium, cement, fertilisers, hydrogen, and iron and steel sectors as well as downstream producers that use these goods in their supply chains are likely to be affected by CBAM.

CBAM is scheduled to begin on 1 January 2027, and the primary legislation for this has already been included in Finance Bill 2025-26. The new draft rules include the legislative requirements that are associated with administering the tax. 
 
What the draft rules cover
The draft legislation includes details on:

• Calculation of the CBAM rate.
• The availability of carbon price relief that can reduce the amount of CBAM charged.
• The administrative requirements relating to registration for CBAM
• What information must be included on CBAM tax returns and related record keeping.
• Details on the reimbursement arrangements.
• How the weight of a CBAM good will be defined and record keeping.
• What records importers need to keep

In short, if you import goods that are affected by CBAM, these rules give you a look at the administrative workload CBAM will introduce.
What’s next?
The documents are open for technical consultation until 24 March 2026, and HMRC is looking for feedback on whether the draft rules are workable in practice.
To review the draft rules and the consultation in full, see: https://www.gov.uk/government/consultations/draft-regulations-carbon-border-adjustment-mechanism-cbam
 
Small Business Britain Provides Beginner-friendly Resources on AI
Small Business Britain has created an online hub dedicated to providing businesses with practical, beginner-friendly resources that can help with getting started in using artificial intelligence (AI).
The hub contains jargon-free guides and video walkthroughs on subjects such as:

• What even is generative AI?
• Can AI save me time?
• How to write a prompt
• How to keep a personal voice

An online course, the AI for Small Business Programme, is also available on the site. This six-week online course is designed to help small business owners unlock AI’s potential in their own business.

There are also webinars and a session from AI experts that can help demystify AI and give you some practical advice on where to start.
The hub is available here. 
 
New FCA Rules for Buy Now Pay Later
Unregulated Buy Now Pay Later (BNPL) agreements will fall under full FCA regulation from 15 July 2026. For the first time, BNPL lenders will need to meet the same expectations as other consumer-credit providers. With almost 11 million UK adults using BNPL in 2024, according to an FCA survey, this is a significant change.

The changes aim to provide clearer protections to individuals who rely on BNPL regularly and may be at risk of taking on commitments they cannot repay.

What Protections Are Being Introduced?
Once the rules take effect, BNPL businesses will have to comply with the FCA’s Consumer Duty. This includes the following changes:

• Clearer information – Customers must be given clear, upfront details of what they are signing up to, including repayment dates, amounts, and what happens if a payment is missed. 
• Affordability checks – Lenders will need to check that a customer can afford the borrowing before they offer BNPL. 
• Support when needed – Lenders will need to offer support to customers who are in financial difficulty and direct them to free debt-advice services, where that is appropriate. 
• Complaints and compensation – Customers will be able to take complaints to the Financial Ombudsman Service.

Why BNPL is Coming Under Regulation
BNPL has grown rapidly in recent years, from £0.06bn in 2017 to more than £13bn in 2024.

For many, BNPL provides short-term flexibility and can help with managing cash-flow. However, without affordability checks, there has been a concern that some may be taking on more debt than they realise.

Timescales
BNPL providers will need to have full FCA authorisation. A temporary permissions regime will open from 15 May to 1 July 2026 so that providers can register while they prepare their full application. Once the new regime begins, six months will be allowed for providers to obtain full authorisation. 
 
What This Means for Businesses
If you use a third party BNPL provider, you may see some adjustments to the way you interact with customers as new affordability checks are introduced.
Your BNPL provider will likely let you know about the needed changes in good time. However, since a failure on their part could reflect negatively on your business, it would be worth staying aware of these changes so that you can check that your provider will comply with the new rules.

See: https://www.fca.org.uk/news/press-releases/new-protections-confirmed-buy-now-pay-later-borrowers
 
New Simpler Sustainable Farming Incentive Announced
Environment Secretary Emma Reynolds announced a new Sustainable Farming Incentive (SFI) offer while addressing the National Farmers’ Union Conference that will be simpler, fairer and more stable.

The new SFI will include 71 actions, a reduction on the current 102, and will be capped at £100,000 per year.

Applications will open in June 2026 for small farms (holdings of three to 50 hectares) and those without a live Environmental Land Management (ELM) revenue agreement.

In September, a second application window will open for all farmers. Further details will follow.

See: https://www.gov.uk/government/news/reynolds-farm-tech-supercharged-to-boost-profitability
 
Guidance Released on the New Business Rates Relief for Pubs and Live Music Venues
The government has released fresh guidance on the new business rates discount for pubs and live music venues in England for the 2026/27 tax year. If you run a hospitality business, or a venue that hosts live performances, the new relief could reduce your rates bills over the next three years.

As announced in January 2026, eligible properties will receive a 15% reduction on their 2026/27 business rates bill. Those rates bills will then be frozen in real terms for 2027/28 and 2028/29. Further guidance will be provided nearer the time on how that freeze will work.

Which properties qualify?
To receive the relief, the property needs to be occupied and be wholly or mainly used as either a pub or a live music venue.

What is a pub?
A property is a pub if all the following apply:

• It’s open to the general public.
• It lets people in for free (except when occasional entertainment is provided).
• Customers can drink without having to buy food.
• Drinks can be bought at a bar.

Restaurants and cafes, nightclubs, and hotels are unlikely to be considered pubs for the purpose of the relief.

What counts as a live music venue?
A live music venue must be wholly or mainly used for live music performances put on to entertain an audience.

Ancillary activities, such as selling food and drink to the audience, would be unlikely to disqualify a property. The same would be true if there was infrequent use of the property to host a polling station or a community event.

Premises mainly used as nightclubs or theatres, based on planning use classes, are unlikely to be considered a live music venue.

There may be grey areas, especially when deciding whether an activity is a live music performance or instead the playing of recorded music. Guidance in the Licensing Act 2003 will be used to help with such situations.

How much will the relief be worth?
The discount is applied daily, at 15% of the business rates charge for each qualifying day.

The discount is applied after any mandatory reliefs due and certain other discretionary reliefs have already been given.

The relief is not subject to any cap.

What should businesses do now?
Local authorities are tasked with calculating the relief automatically once they have put their local scheme in place. Therefore, if the property meets the criteria, you should automatically receive any relief due on your 2026/27 rates bill.

In the meantime, it may be worth checking whether your current description and use of the property clearly match the definitions provided in the guidance.

See: https://www.gov.uk/guidance/business-rates-pubs-and-live-music-venues-relief-local-authority-guidance
 

20th February 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

Personal Tax Changes Coming in April 2026
With just a few weeks to go until the beginning of a new tax year, a new round of tax changes take effect from April 2026. While many people won’t see a big difference in their day-to-day tax position, there are some areas worth having on the radar.

Here is a run-through of some of the changes you may want to be aware of.

Dividend Tax Rises
The tax rates for dividends are rising from April 2026. The basic rate and higher rates are each increasing by two percentage points to 10.75% and 35.75%, respectively. The dividend additional rate remains at 39.35%.

Many company owners rely on a combination of salary and dividends for their pay. If that’s you, it’s important to review how you draw income and whether your current mix of salary and dividends still makes sense.

Thresholds Remain Frozen
The tax-free personal allowance and income tax thresholds all remain frozen and are set to stay that way until 2030/31. That ongoing freeze will continue to pull more people into higher rates of tax.

For Scottish taxpayers, there is an increase to the basic and intermediate rate thresholds. This means that lower earners will see a small increase in their take-home pay. However, because of fiscal drag, higher earners will be increasingly drawn into paying additional tax.

National Insurance and Voluntary Contributions
People with gaps in their national insurance contribution (NIC) record, those who are self-employed with low profits, or those who work overseas often consider making voluntary contributions.  

From 6 April 2026, the rate for Class 2 NICs (applicable to the self-employed) will be increased from £3.50 to £3.65. The rate for voluntary Class 3 NICs will increase from £17.75 to £18.40.

Aside from the increase in rates, a major change is that voluntary Class 2 NIC will no longer be an option for periods spent abroad. Making voluntary Class 3 contributions will be possible, but the qualifying criteria have been tightened.
 
Capital Gains Tax (CGT)
Business owners thinking about selling or restructuring should be aware that capital gains that are subject to business asset disposal relief or investor’s relief will be taxed at 18% for 2026/27, an increase from 14% in 2025/26.

Reliefs for disposals to employee ownership trusts have also been scaled back and the rules for share reorganisations have been tightened. Both changes are already in force.

These changes won’t affect everyone, but if you are considering business succession or restructuring, getting the timing and your approach right continues to be key.

Inheritance Tax - Agricultural and Business Property Relief Changes
As has been widely publicised, changes to Inheritance Tax (IHT) to Agricultural Property Relief (APR) and Business Property Relief (BPR) will come into force on 6 April 2026.

These reliefs were previously unlimited, but from April, 100% relief will be capped at £2.5 million of combined agricultural and business assets. Thereafter, the relief reduces to 50%. Unused amounts can be passed to a spouse or civil partner.

The £2.5 million limit is higher than initially proposed, but those who may be affected by the new cap may want to consider whether there are ways to rearrange their estate that would be effective in saving tax.

In Conclusion
If you are affected by any of these changes for 2026/27 and would like help in making sure you are in the best tax position possible, please get in touch. We would be happy to help you!

See: https://www.icaew.com/insights/tax-news/2026/feb-2026/prepare-for-2026-27-individuals
 
Could a Fiscal “Traffic Light System” Help Your Business Cut Through Uncertainty?
A leading think tank has criticised the fiscal rules that the Chancellor uses to determine the government’s tax and spending plans. The Institute for Fiscal Studies (IFS) has suggested that reducing complex finances to a pass‑or‑fail number misses the bigger picture.

The Treasury, on the other hand, has said that the rules are helping to keep borrowing costs down and support long‑term investment.

Of course, which view is correct when it comes to managing the country’s finances could be an endless debate. However, the IFS proposal brings up an interesting idea that many businesses are using with success.

The IFS Proposals
The IFS are advocating moving to a fiscal “traffic light” system. Rather than judging the economy against the one requirement for “headroom”, a broader set of indicators should be assessed. And given a green, amber or red status.

Why This Idea Might Feel Familiar to Businesses
This traffic‑light idea is something many businesses already use informally. For instance, it’s very common to track financial health and business performance using a dashboard of red, amber and green indicators.

Business owners can get an ‘at-a-glance’ look at the different areas of the business and quickly flag potential problems.

Applying a Traffic‑Light System to Your Own Business
A simple set of indicators is often all that is needed. Three or four core measures can help to assess the business and check its day‑to‑day resilience. For example:

• Cash flow - green if you have several months’ operating expenses covered; amber if cash is tightening; red if you’re relying on short‑term borrowing.  
• Debt levels - green if repayments are comfortable; amber if interest is creeping up; red if refinancing is looming or facilities are nearly maxed out.  
• Profitability - green if margins are holding; amber if costs are rising faster than prices; red if losses are recurring.  
• Sales pipeline - green if opportunities are converting; amber if lead volumes drop; red if future revenue is unclear.

Businesses using a traffic‑light approach tend to make decisions earlier - whether that’s tightening costs, adjusting pricing, or negotiating with lenders. It also helps everyone in the business get a picture of what’s happening without necessarily needing to dive into pages of accounts.

If you would like help building a simple financial traffic‑light dashboard tailored to your business, we would be happy to work with you in developing something that is based on the metrics that matter most to your business.

See: https://www.bbc.co.uk/news/articles/c1kg48m937wo
 
UK Unemployment Rises as Wage Growth Slows
The UK’s unemployment rate has risen again, according to the latest data from the Office for National Statistics (ONS). In the three months to December 2025, unemployment increased to 5.2%, up from 5.1% in the three months to November. This marks the highest rate in almost five years.

Alongside the rise in unemployment, annual wage growth has slowed to 4.2%, its weakest pace in close to four years.

This combination of slower wage growth and rising unemployment suggests a cooling labour market.

Businesses Reacting to Higher Costs
Part of the slowdown may be linked to increased employment costs. The 2024 Budget raised employer national insurance contributions and increased the minimum wage.

Some businesses appear to have chosen to delay recruitment or leave vacancies unfilled as they review budgets for the year ahead.

Younger Workers Bearing the Brunt
The unemployment rate for 16–24-year-olds has risen to 16.1%. For school leavers and graduates, securing an entry-level role has become increasingly competitive.

Analysts have also raised concerns that investment in artificial intelligence could reduce the number of traditional starter roles over time, adding further pressure to new entrants to the job market.

Interest rates
The slowdown in wage growth may influence the Bank of England’s next decision on interest rates and could give room for a further rate cut.

Looking ahead
For your business, a softer labour market might make it easier for you to fill certain vacancies, with more applicants available for job openings. However, it could also hint at weaker consumer confidence that may lead to slower sales. If you are planning investment, recruitment or borrowing in the coming months, this may be a useful moment to revisit those plans rather than rush decisions.

See: https://www.bbc.co.uk/news/articles/c1l7pedyzjeo
 
Campaign Urges SMEs to Adopt Cyber Essentials as Cyber Threats Rise
A new campaign has been launched to encourage small and medium-sized businesses to take some simple, practical steps to protect themselves from the most common cyber-attacks. The main drift is that basic cyber hygiene still prevents the majority of incidents.

According to the Cyber Security Breaches Survey 2025, 43% of businesses and 30% of charities reported having experienced some kind of cyber security breach or attack in the last 12 months. Across the UK economy, cyber threats are estimated to cost £14.71 billion each year. For many businesses, a single major attack could be enough to put trading at risk.

Cyber Essentials
The campaign centres on Cyber Essentials, which was developed by the National Cyber Security Centre (NCSC) and the Department for Science, Innovation and Technology. It focuses on five key protections that most businesses can implement without needing to have specialist IT expertise. These are:

• Firewalls
• Secure configuration
• Software updates
• User access control
• Malware protection

These five areas address the weaknesses most commonly exploited by cyber criminals. Basic oversights, such as out-of-date software or a lack of control over who has access to IT systems, continue to be the root causes of many incidents.

Getting Started
To help businesses get started, some free resources are being promoted as part of the campaign, including:

• Cyber Essentials Readiness Tool - an online self-assessment to identify gaps
• Free 30-minute consultations with an NCSC-assured advisor for SMEs preparing for certification

While it can be tempting to think you are too small to be a target, most cyber-attacks are automated and opportunistic and look for weaknesses in systems regardless of the size of the business. This campaign is a timely reminder that basic measures can significantly reduce the likelihood of disruption, protect cash flow and help safeguard customer trust.

See: https://www.gov.uk/government/news/businesses-urged-to-lock-the-door-on-cyber-criminals-as-new-government-campaign-launches
 
Inflation Drops to 3%
According to the latest figures released by the Office for National Statistics, UK inflation eased to 3% in January, down from 3.4% in December. Lower food, fuel and airfare prices appear to have been the biggest contributors to the reduction.

It’s important to remember this doesn’t mean prices are falling; they are just rising more slowly. Businesses still dealing with higher wages, energy and supplier costs will know that firsthand.

The combination of softer inflation and a slowdown in wage growth has increased expectations that the Bank of England will cut interest rates again when its Monetary Policy Committee (MPC) meets in March.

The latest inflation figure may suggest some better news for businesses over the coming months. Perhaps an easing of costs generally, or some relief from interest costs, particularly if your business has an overdraft or variable-rate loans.

See: https://www.ons.gov.uk/economy/inflationandpriceindices/bulletins/consumerpriceinflation/latest
 
Employment Rights Act - What is Changing First?
A new website has been launched by the Department for Business and Trade (DBT) offering practical guidance and support on the changes that the Employment Rights Act will introduce and what they can do to get ready.

The website provides details of upcoming changes, including several that come into force from April 2026. These include:

• Statutory Sick Pay - No earnings threshold and no three-day waiting period mean more employees will now qualify. 
• Day-one family leave - Paternity Leave and Unpaid Parental Leave a right from the first day in a job. 
• Bereaved Partner’s Paternity Leave - A new right for time off following the death of a child’s mother or primary adopter. 
• Collective redundancy protections - The protective award for non-compliance is being increased. 
• Stronger protections for workers who report sexual harassment. 
• A new body called the Fair Work Agency will work to uphold workers’ rights and support businesses with compliance.

The website includes details on how to prepare for changes and a timeline of when further changes will be introduced. It can be found here and would be well worth saving to your browser favourites. 

13th February 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

Is “996 culture” Working Culture Relevant to Your Business?
The BBC has published an in-depth piece on “996 culture” - the practice of working 9 am to 9 pm, six days a week.
Although the examples mostly come from US tech companies, there are some useful lessons for UK business owners. Here are some points that stood out to us.

The Appeal of 996
The article looks at AI start‑ups in the US that openly promote 70‑hour working weeks, often attracting young, ambitious staff who see long hours as a badge of honour. Some businesses even advertise these expectations upfront.

996 culture is not new or unique to the US. It first gained popularity in China a decade ago when it was seen as a powerful tool in helping tech companies and start-ups gain traction. However, it led to a backlash of complaints about workers’ rights that led to a legal crackdown.

However, based on the BBC’s report it seems that competition in AI is pushing founders in the US to demand extreme commitment. They fear being beaten to market and believe working more hours equates to faster progress.

Concerns About 996
The report highlights several problems with the 996 approach.

For instance, while it is understandable and may even be expected that a founder with skin in the game would be working 70-80 hours per week, expecting the same of employees may not achieve more productivity and can exclude workers who would be vital to the business’s interests.

Continual long hours lead to long-term burnout and bring other health risks. For instance, the BBC notes the conclusions reached by an analysis published in 2021 by the World Health Organisation (WHO) and the International Labour Organisation (ILO). This showed that working 55 hours or more a week increased the risk of dying of heart disease by 17% when compared with working 35-40 hours. The risk of stroke also increased by 35%.

Besides health concerns, productivity does not increase in line with the number of hours worked. Research by Michigan State University suggests that employees are no more productive working 70 hours per week than if they worked 50 hours per week.

Could 996 Culture Work for You?
While 996 culture is not mainstream in the UK, there are proponents. In addition, for workers at large corporate law firms and investment bankers, the idea of working 70 hour weeks may feel commonplace. Some may enjoy what has been called “work-life integration.” However, there are downsides.

The Working Time Regulations mean that working more than 48 hours a week on average is not allowed unless the employee chooses to opt out and work longer, or they are doing a job that has exceptions under the law. This means that 996 is possible; pressuring staff to conform rather than giving them a genuine choice would be risky.

Practically speaking, a 996 approach may also make recruitment trickier. Employees would need a compelling reason to work 70 hours a week against a 35-hour week in an alternative job.

Over-reliance on unpaid or excessive overtime can also harm productivity, especially in the long run. Investing in skills, automation and smarter workflows could give a better return than working longer days.

For smaller businesses in particular, culture is a competitive advantage. A reputation for balanced, sustainable working patterns can make working for you more appealing and reduce the risk of employees leaving.

Finding a sustainable pace
If you are a business owner, the idea of 996 may feel uncomfortably familiar. Especially in the early stages of a business, there will inevitably be phases when the hours creep up. But if you feel this is becoming a permanent way of working, it’s usually a sign the business needs something to change rather than you simply working harder.

Often, the pressure comes from a few predictable places – cash flow tightness, gaps in capacity, unclear business processes or work that only you can do because no one else has been shown how. These business issues are often fixable once they have been identified.

If cutting back your hours is something you are aiming for, the first step is usually to understand where the strain is coming from. Once you can see that clearly, it becomes easier to work towards a more manageable workload. Sometimes just a small change in how the business is organised can make a big difference.

Whether you are thinking about workplace culture or your own situation, if you would like to talk things through or to see how your business could be made more scalable and less reliant on your time, please get in touch. We would be happy to help you continue running and growing your business sustainably.

See: https://www.bbc.co.uk/news/articles/cvgn2k285ypo
 
New Detail Published on How Last Year’s Budget Leak Unfolded
The government has now published its Review into the 2025 Autumn Budget leak, explaining how the Office for Budget Responsibility’s Economic and Fiscal Outlook (EFO) was accessible online an hour before the Chancellor was due to speak.

The Review sets out measures that will be taken to prevent this from happening again.

What actually happened?
The Review incorporates findings from the National Cyber Security Centre’s investigation, which found that the leak was a result of repeated attempts to access the webpage holding the EFO, rather than a hostile cyber-attack.

The fault lay in a misconfiguration in the way that the OBR’s website was set up. This meant that the webpage holding the report was accessible earlier than the OBR intended. Users who guessed the webpage address correctly based on previous reports were able to access the report.

The investigation found that around 520 of the 534 early access attempts were linked to just four IP addresses from the same internet provider. Investigators believe it is reasonable to assume this was the same individual or organisation.

The one or more individuals who secured early access seem to have then used social media and messaging apps to spread word of the early access. In all, the EFO was downloaded 24,701 times before the mistake was noticed.

What is changing?
The OBR is due to publish an EFO at the time of the Spring Forecast announcement on 3 March 2026. Historically, the OBR has published these reports on its own website rather than a government website in order to maintain its independence.

However, because of the sensitivity of the information contained in the EFO, it will be published on GOV.UK by HM Treasury. HM Treasury has commented that doing this will not give it access to any information ahead of time of which it is not already aware.

For future EFO and other market-sensitive publication releases, it is planned that OBR will move to using GOV.UK.

In readiness for the 2026 Budget, likely to be held in the autumn, there are plans to bring in other internal measures that will enhance security and limit data access.

To read the Budget Information Security Review in full, see: https://www.gov.uk/government/publications/budget-information-security-review
  
CMA Moves to Secure Fairer App Store Rules for UK Businesses
The Competition and Markets Authority (CMA) has announced a set of proposed commitments from Apple and Google that could make it easier for UK businesses that rely on app stores to reach their customers.

The CMA is inviting views on these commitments until 3 March 2026, with plans for them to take effect from 1 April 2026.

What’s happening?
The CMA has been working with Apple and Google since both companies were given “strategic market status” (SMS) in late 2025.
Almost all UK mobile devices run either Apple’s iOS or Google’s Android system, an effective duopoly, and the status gives the CMA powers to require changes where it sees problems for competition or fairness.

Rather than going straight to imposing conduct requirements, which can take time to implement, voluntary commitments have been agreed with Apple and Google to deliver immediate improvements.

What the commitments mean in practice
The UK app economy is big business, valued at £28 billion as of 2025 and supporting around 400,000 jobs. Many UK companies now depend on mobile apps as a core part of how they serve customers.

For UK businesses and developers, the proposed measures focus on four practical areas:

• App review: Apple and Google are committing to distribute apps on their app stores in a fair, objective and transparent way. They will not discriminate against apps that compete with their own, nor will they give preferential treatment to their own apps. 
• App ranking: The new commitments mean Apple and Google should not favour their own apps, nor push down apps that compete with them. 
• Data collection: Apple and Google have committed not to use data they gather from developers during an app review unfairly; for example, not using insights from your app to develop competing features. 
• Interoperability: Apple has agreed to make it easier for developers to more easily request interoperable access to features and functionality within their mobile operating systems. They have also committed to considering requests fairly and objectively. 

Monitoring
To ensure the commitments are met, the CMA will publish reports using data from Apple and Google. This will include:

• Percentage of apps submitted for review that are approved, rejected or appealed.
• Time taken for app reviews.
• The number and outcome of complaints.
• Interoperability requests made to Apple, outcomes and how quickly the requests are handled.

What next?
Chief Executive of the CMA Sarah Cardell said that the proposed measures are “important first steps while we continue to work on a broad range of additional measures to improve Apple and Google’s app store services in the UK, for example, by enabling more choice and innovation in digital wallets”.

The CMA is looking for views on the proposed commitments by 3 March 2026, with implementation planned from 1 April 2026.

See: https://www.gov.uk/government/news/cma-secures-commitments-from-apple-and-google-to-improve-fairness-in-app-store-processes-and-enhance-ios-interoperability
 
HMRC Moves to GOV.UK One Login for New Users
HM Revenue & Customs has started using GOV.UK One Login for taxpayers signing up to its digital services for the first time.

This means that if you do not already have a Government Gateway account, you will now register using an email-and-password login rather than needing to obtain a 10-12 digit Government Gateway ID.

For now, this only affects new HMRC users. Existing Government Gateway users do not need to switch yet.

Even if you already have a GOV.UK One Login that you use for another government service, you will still need to use your government gateway to access HMRC’s services for the time being.

HMRC plans to roll out GOV.UK One Logins gradually and will contact existing users when it is ready for them to move over.

Eventually, GOV.UK One Logins will become the single login for everything from filing a tax return to renewing a passport.

If you need help registering for or accessing HMRC services, please contact us. We will be happy to help you! See:
https://www.gov.uk/government/news/hmrc-introducesgovukonelogin-for-new-customers
 
DBS Launches New Safeguarding Podcast for Employers
The Disclosure and Barring Service (DBS) has launched a new weekly podcast series, ‘DBS discussions: Safeguarding in Focus,’ aimed at employers, HR teams and anyone working in safeguarding.

Each episode of the podcast features a DBS specialist explaining how key DBS processes work in practice. Topics will include:

• How DBS checks fit into recruitment.
• Common questions from employers.
• Clarity on eligibility and regulated activity.
• How barring decisions are made.
• The role DBS plays in wider safeguarding.

The first episode was released on 9 February 2026, and introduced the function of DBS and the impact of checks in recruitment.

New episodes will be available each week on Spotify, Amazon and YouTube.