17th October 2025 – Hillmans Weekly Update

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

Have a great weekend.

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

Why Thinking Like a CFO Can Help You Shape Your Business
For many small and medium-sized business owners, bookkeeping, payroll and VAT returns are seen as a necessary part of their routine. These tasks are essential, but in terms of shaping your business, they can only tell you what has already happened.

It can give you a real advantage if you also spend some time thinking like a strategic Chief Financial Officer (CFO). That means using your financial data to plan and forecast so that you make smarter decisions for your business.

Bookkeepers record history, CFO thinking shapes the future
A bookkeeper’s job is to make sure that the numbers are complete and accurate, but a CFO - or a business owner thinking like one - takes those numbers and asks questions like:

• Which customers or products generate the most profit?
• How much cash do we really need in the next six months?
• Where should we invest resources for maximum impact?

Adopting this kind of mindset can transform how you run your business. The good news is that it’s not that difficult to develop some core skills that will help you to do this.

Core skills every business owner can learn

• Financial Literacy: Understand P&Ls, balance sheets and cash flows. These aren’t just for accountants; they can be your roadmap for understanding the financial performance of your business.
• Forecasting and Budgeting: Forecast what your business income is likely to be, plan for expenses and prepare for seasonal variations. 
• Key Metrics: Track metrics that matter to your business - cash flow, margins, costs to acquire customers - so that you can make decisions based on data, not just gut feel. 
• Risk Awareness: Identify risks to your finances early on, whether it’s a slow-paying customer or an investment that’s costing too much.

Just picking one of these areas and making a small improvement can pay dividends.

Start small, think big
You don’t need fancy software or a finance degree. You could begin with:

• Weekly checks on your cash flow.
• Reviewing profit margins per product or service.
• Setting simple financial goals for the quarter.

Gradually, these habits build the foundation of strategic financial thinking allowing you run your business more confidently and proactively.

The bottom line
Treating finance as a back-office chore keeps you in the dark. Thinking like a CFO - tracking the right numbers, asking the right questions, and planning ahead – can give you control, clarity, and confidence.

Bringing a CFO’s mindset into your business doesn’t mean you need to do it all alone. Sometimes an outside perspective can make the numbers clearer and the decisions easier. That’s where we can help. If you’d like a sounding board to help you step back, see the bigger picture, and plan with confidence, we would be happy to help you!
 
Weekly Cash Flow Checks: Stay Ahead of Surprises
Cash flow is the lifeblood of any business. Without it, even profitable businesses can run into trouble. Yet many business owners, and even some finance teams, treat cash flow as a monthly or quarterly review item. That’s a mistake.

A weekly cash flow check is a simple, powerful habit that keeps you informed, proactive and in control. It’s a simple routine that will help you to keep your business financially healthy, spot opportunities early, and gain confidence in every decision.

What can weekly checks do for you?
Weekly cash flow checks can help you to:

• Avoid surprises. When you review your cash inflows and outflows weekly, you’ll spot timing gaps, slow-paying clients, or unexpected expenses before they become urgent. 
• Plan smarter. Being able to see what’s happening to cash will help you make better decisions and avoid problems. For instance, should you delay a payment, push harder on collections, or hold back on spending? 
• Spot opportunities early: Regularly reviewing cash flow can reveal trends and openings you might otherwise miss, such as funds that are available to grow the business or potential savings on expenses.

 
What are the core steps for a weekly check on cash flow?
Hopefully, you’re convinced of the benefits, but how do you do it? Here are five steps to a weekly check on cash flow.

STEP 1: Update Cash Position
Start by reviewing your bank balances and reconciling them with any outstanding invoices and bills.

You’ll need to make sure your accounting data is accurate and up-to-date, but this should help you know exactly how much cash is available.

STEP 2: Project the Next 2-4 Weeks
List out everything you expect to receive and everything you expect to pay out over the next 2-4 weeks.

This will help you to see where potential shortfalls could come, or where you might have an opportunity.

STEP 3: Compare Forecast to Reality
Look back at last week’s projections and notice how they differed from what happened in reality. Make sure you know the reason “why” behind differences. Was it a late payment? Were there unexpected expenses? Or did a sale you were expecting not come off?

As you do this, you’ll get better at estimating what’s likely to happen in future. For instance, you might tend to be too optimistic about when customers will pay you.

STEP 4: Identify Action Items
Based on what you’ve learned, you should be able to list out some actions that can be taken over the coming week.

Don’t necessarily try and list everything possible. You only have a week before the next review. Make sure that you flag the most critical issues so that you can make a meaningful adjustment.

You might decide to set a program of calls to customers to chase collections, defer non-critical expenses, or adjust staffing plans.

STEP 5: Document and Track Trends
Keep a simple log of your weekly checks. Over time, patterns can emerge that will help you in your budgeting, forecasting and decision making.
Tips

• A simple spreadsheet with columns for inflows, outflows, net cash and comments can be a good start and make it easier to collect and record the information you need. 
• Many banking apps can be set to automatically notify you if balances drop below a preset threshold. 
• Consistency is key, so you’ll want to schedule a fixed day each week for this review. Mark it in your calendar and make it non-negotiable.

Bottom line
Weekly cash flow checks can transform your financial management from reactive to proactive. It can mean peace of mind and smarter decisions, and give you an insight into your business that goes way beyond what day-to-day bookkeeping allows.

If you would like assistance in making a cash flow check part of your weekly routine, please get in touch. We would be happy to help you!
 
Striking Off vs Winding Up: What’s the Difference for Your Company?
The Insolvency Service has reported on an investigation it made into a company that was serving as a front to enable unlicensed insolvency activities previously carried out by another firm.

The investigation resulted in the Insolvency Service winding up the company in the public interest. The case serves as a reminder that only properly licensed insolvency practitioners can act as a liquidator or administrator for a company.

However, if you’ve reached the point where your company has run its course and you want to close it down, does that mean your only option is to formally wind it up using a licensed insolvency practitioner?

No. Another option open to many companies is to have the company ‘struck off.’

Let’s explore the differences between striking off a company and winding it up, and in what circumstances you might choose one over the other.

What is striking off?
Striking off, often known as ‘dissolution,’ is the simpler and usually cheaper way to close a company. Basically, you apply to Companies House (using form DS01) to have the company removed from the register. Once that happens, the company no longer legally exists.

It’s typically used when the business is no longer trading, there are no debts outstanding, and all assets (like cash in the bank or equipment) have been distributed to shareholders.

What is winding up?
Winding up (or “liquidation”) is a more formal process. A licensed insolvency practitioner is appointed to sell off the company’s assets, settle debts, and distribute anything left over to shareholders. Once everything is complete, the company is struck off the register.

It’s typically used when:

• The company cannot pay its debts (insolvent liquidation). 
• The directors or shareholders want a formal, orderly closure, even if the company is solvent (members’ voluntary liquidation). 
• There are complex affairs that need professional handling.

Key differences at a glance

• Cost: Striking off is inexpensive (a small Companies House fee), while winding up involves professional fees for the liquidator. 
• Debts: Striking off is only an option if debts are cleared. If creditors are owed money, they can object and force the company into liquidation instead.
  
• Control: Striking off is handled directly by directors, whereas winding up requires external oversight. 
• Risk: If directors strike off a company without properly settling debts or assets, creditors can restore the company to the register and pursue them. Winding up offers more protection.

Why choose one over the other?
If your business is small, debt-free, and you just want to wrap things up simply, striking off is often a good option. It’s also common for dormant companies or businesses that never really got off the ground.

On the other hand, if your company is insolvent, if you want legal certainty that everything has been settled properly, or if you’re dealing with significant assets or liabilities, then the formal winding up process is better.

Final thought
Both routes end with the company being removed from the register, but the right choice depends on your company’s financial position and how much formality is needed.

To get personalised advice on the right option for your company, please give us a call. We would be happy to help you!

See: https://www.gov.uk/government/news/manchester-company-used-as-front-for-unlicensed-insolvency-activities-is-shut-down
 
Why “Staff Welfare” Should Feature in Your Incident Response Plan
Cyber incidents, data breaches and operational disruptions don’t just affect systems - they affect people.

The National Cyber Security Centre (NCSC) has published guidance called “Putting staff welfare at the heart of incident response” to help organisations consider the impact of a cyber incident on the people involved. While the guidance has been available for some time, the increasing prevalence of cyberattacks continues to make it timely.

When things go wrong - whether it’s a cyberattack, system failure or security breach - employees may feel stress, uncertainty, fatigue, guilt, or anxiety. The NCSC’s view is that if welfare is overlooked, it actually undermines the resilience of the whole response effort. A team that’s burnt out or demoralised is less able to think clearly, act decisively, or recover well.

What the NCSC recommends
The guidance lays out five core recommendations for making sure that staff welfare is considered:

• Include all staff in the incident response plan: When planning how you will respond to an incident, identify the staff that will be affected by it. Consider what the potential stresses might be. For instance, what if key staff are absent? Can you call on staff to handle incidents outside normal working hours? Planning can reduce unnecessary stress if an incident happens. 
• Build a culture where staff feel safe to speak up: In a stressful incident, people cope with it differently. The guidance encourages a positive, secure culture where staff will feel able to speak up if they are feeling overwhelmed, burnt out, or need help, or if they spot worrying signs in their colleagues. This will help you to handle a problem before it becomes too serious. 
• Plan your internal communications: During a live incident, people want clarity. Keep everyone – including staff that are not directly involved – informed about what’s happening. 
• Be conscious of staff concerns: Staff are likely to worry about how the incident will impact their own livelihoods, whether because their personal information has been stolen or they will lose their job. Clearly communicating how the business plans to get through the incident can help people focus on what they need to do rather than worrying. 
• Practise your response: Practice can help your staff feel better prepared. NCSC offers a free Exercise in a Box that can be used for this purpose.

If you have an incident response plan (or are planning to build one), it’s worth reviewing it through a welfare lens by using NCSC’s guidance.

To review the guidance, see: https://www.ncsc.gov.uk/guidance/putting-staff-welfare-at-the-heart-of-incident-response
 
Charity Commission Warns on Key Risks for Charities
A new “Charity Sector Risk Assessment” recently published by the Charity Commission identifies some of the serious risks charities in England and Wales are facing.

The report draws on data from annual returns, serious incident reports and casework. It notes several pressures that are making it harder for many charities.

What the risk assessment found
Some of the headline issues include:

• Rising operating deficits: In the 2023 Annual Return, 22.5% of charities reported a deficit (i.e. spending more than they bring in), up from 20% in 2022. 
• Increasing demands vs costs: Many charities are seeing more demand for their services, while costs are rising and inflation is eating away at the value of their funding. 
• Use of reserves: Having a deficit doesn’t mean a charity is insolvent. However, many charities are relying on their reserves to cover the gap between income and expenditure. Overuse of reserves can quickly leave little safety net. 
• Risks to public trust: Though relatively rare, misuse of charity property, unauthorised payments, false claims for Gift Aid, or setting up charities for private benefit were flagged as significant because of the damaging effect even isolated incidents can have on public trust. 
• Other concerns: Governance, safeguarding, fraud, cyber threats, and external pressures such as geopolitical instability are also in the mix.

What should trustees do?
The Charity Commission have included some guidance for trustees in the report. The importance of careful forecasting and planning, and being able to respond quickly to any early warning signs, is emphasised.

The Charity Commission has a range of guidance to help trustees fulfil their responsibilities around financial stewardship, and it is planned to promote these further in a new awareness campaign this autumn.

If you would like personalised assistance with your charity, please get in touch. We would be happy to help you!

The full report can be read here: https://www.gov.uk/government/publications/charity-sector-risk-assessment-2025/charity-sector-risk-assessment-2025

10th October 2025 – Hillmans Weekly Update

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

Have a great weekend.

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

Preparing Your Business for Life Beyond You
When Spotify’s founder Daniel Ek announced he would step down as chief executive, it made headlines. After nearly 20 years running one of Europe’s most successful tech companies, he’s shifting into a chairman role and leaving day-to-day control to two long-serving deputies.

For most business owners, the sums and scale are very different – but the principle is the same. At some point, you may want (or need) to step back. Maybe that’s for retirement, maybe to focus on new opportunities, or simply to avoid burning out. The question is: how do you prepare your business to thrive without you in the driver’s seat every day?

Here are some practical steps worth thinking about:

1. Build a capable leadership team
Ek’s handover wasn’t sudden. His deputies have been running much of the business since 2023, which means staff and customers are already used to them leading.

For a smaller business, this might mean gradually giving key managers more responsibility. Let them make decisions, even if you’d sometimes do things differently. Better to iron out issues while you’re still around than to hand over untested.

2. Separate ownership from management
Many founders assume stepping back means selling up. Not necessarily. Ek is still chairman and still guiding long-term strategy, for the time being at least, but no longer managing the day-to-day.

As a business owner, you could consider keeping your shares and remaining involved at board level, while hiring or promoting someone to run day-to-day operations. That way you benefit from the company’s growth without being tied to the grind.

3. Get your systems in order
The bigger the reliance on “what’s in your head”, the harder it will be for anyone else to run things. This isn’t always easy to detect, particularly if you enjoy being in the middle of things.

You could ask yourself: how many decisions come my way during a typical day? Do all those decisions need my input, or if some of the business processes were written down could staff get things done without waiting?

Having up-to-date procedures, good accounting systems, and clear contracts with customers and suppliers can all help. The more clarity there is, the less your team has to guess.

4. Think about your own role differently
Ek is shifting his focus to strategy, capital allocation and regulatory efforts – this long term, strategic work is likely to be work that he is best placed to do. This is a useful way of thinking about your own role.

Ask yourself: what are the tasks that genuinely require you? And what could be delegated?

Freeing yourself from day-to-day firefighting gives you time to work on the bigger picture.

5. Plan the story you’ll tell staff and customers
Spotify’s share price dipped when Ek’s decision was announced, a reminder that transitions can unsettle people. The same is true in smaller businesses – staff may worry about job security and customers may have concerns about service quality.

Good communication can help. Explain the plan, show confidence in your team, and reassure people.

A final thought
You don’t need to be running a global giant to learn from this. Every founder has a choice to make about how long they stay hands-on. Planning your own “step back” early can help to make your business stronger, give you more options, and protect the value you’ve worked so hard to build.

See: https://www.bbc.co.uk/news/articles/c3rv35xp07lo
 
Autumn Budget 2025 – What Might Be Coming for Businesses?
The Autumn Budget will be delivered on 26 November, but the Chancellor’s recent speech in Liverpool gave us some useful hints about what could be on the table.

The Chancellor Rachel Reeves appeared to prepare the ground when she said: “We will face further tests, with choices to come, made all the harder by harsh global headwinds and long-term damage to the economy, which is becoming ever clearer.”
 
Her comments note two factors:

• Global headwinds – trade tensions, wars and higher interest rates driving costs up.
• The UK’s own productivity problem – the Office for Budget Responsibility (OBR) is due to publish a critical reassessment of the long-term productivity performance of the UK economy.

In short, the message seems to be: don’t be surprised if taxes rise, and don’t expect giveaways.

How might taxes be raised?
It looks as though there will be no change to the main tax rates (Income Tax, National Insurance and VAT). When pressed on whether VAT could rise, the Chancellor said: “The manifesto commitments stand.” She further said that she wants to protect pay packets and “not put up the prices in shops” – which also makes a straight VAT rise unlikely. But she hasn’t ruled out changes elsewhere.

One option for raising money without headline rate rises is to keep tax thresholds frozen. As wages rise with inflation, more people and businesses get dragged into higher tax bands.

Pensions, housing-related tax breaks, and other business reliefs could also be reviewed. The government may frame these as closing “loopholes” rather than introducing new taxes.

Reeves has also confirmed that there could be changes to the legally required biannual forecasts carried out by the OBR. When the mid-year OBR forecasts don’t meet expectations, the resulting speculation about tax changes can lead to wider instability. These forecasts might now only happen once a year, which could help with this.

What this could mean for you
We won’t know the detail until the budget is delivered at the end of next month. But this Budget is unlikely to bring windfalls for business – it looks like it could be more about stability and plugging gaps in public finances.

As ever, preparation is key. Keep an eye on the announcements and be ready to adapt. We’ll be keeping you informed with details of what’s changed following the Budget. As ever, if you would like any personalised advice please give us a call. We would be happy to help you!

See: https://www.bbc.co.uk/news/articles/cj6x07j9e43o
 
Could Your Child Be Sitting on £2,000 Without Knowing It?
New figures show that more than 750,000 young people haven’t claimed their matured Child Trust Funds – savings pots worth an average of £2,242 each.

If your children, employees, or even apprentices are aged between 18 and 23, there’s a good chance some of them could be sitting on money they don’t know about.

What is a Child Trust Fund?
Child Trust Funds (CTFs) were set up by the government for children born between 1 September 2002 and 2 January 2011. Each account started with a government deposit of at least £250, and many families topped them up over the years.

The accounts are tax-free, and once the child turns 18, the money becomes theirs. They can either withdraw it or reinvest it.

Why so many are unclaimed
When the scheme was running, if parents didn’t open an account, the government did it for them. Now, according to HMRC, 758,000 accounts are sitting unclaimed.

September is the most common birth month so there is a new wave of 18-year-olds who have just become eligible to claim their savings pot.

How to find out if you’ve got one
If you already know who the provider is, you can contact them directly. If not, there’s a locator tool on GOV.UK – it takes a few minutes to submit a request, and you’ll usually hear back within three weeks.

You’ll need the young person’s National Insurance number and date of birth when using the tool.

A quick reminder for business owners
If you employ young people in this age group, it might be worth mentioning this to them. Some may not know they might have a CTF waiting. A quick word could genuinely make a difference to their finances – and they’ll likely remember you helped point them in the right direction.

See: https://www.gov.uk/government/news/savings-stash-worth-thousands-waiting-for-758000-young-people
 
CMA Flags Concerns Over Rising Fuel Margins
The Competition and Markets Authority (CMA) has published its latest monitoring report on fuel prices, highlighting increases in both pump prices and retailer margins.

Between May and August 2025, the average price of petrol rose to 133.9 pence per litre (ppl) and diesel climbed to 141.9ppl. That’s up by 1.9ppl and 3.5ppl respectively.

While global oil markets explain part of the increase, the CMA is more concerned about retailers holding onto higher profits at the pump.

Margins far above historic levels
The CMA found that:

• Supermarket fuel margins (the difference between selling price and what the supermarket pays for fuel) averaged 8.4% for the first half of 2025 – more than double the 4% level seen in 2017. 
• Non-supermarket retailers saw an average margin of 9.8% for the same period, compared with 6.4% in 2017.

Dan Turnbull, Senior Director of Markets at the CMA, said: “What’s deeply concerning is that fuel margins – a key indicator of retailer profit – remain far above historic levels.”

In fairness, the monitoring report doesn’t look at how operating costs have changed for retailers. So, CMA will be carrying out a full review of retailers’ operating costs in its first annual road fuel monitoring report, which is due to be published at the end of 2025. This will allow the CMA to assess whether rising costs explain some of the increase, or whether retailers are simply enjoying fatter profits.
Retail spreads remain high

The CMA also looked at “retail spreads” – the average price drivers pay at the pump compared to the benchmark price at which retailers buy the fuel.

• Retail spreads for petrol averaged 13.3ppl between June and August, lower than the spring period but still double the 2015–2019 average of 6.5ppl. 
• Diesel spreads also averaged 13.3ppl, well above the long-term average of 8.6ppl.

Fuel Finder scheme coming
Following a recommendation made by the CMA in its 2023 road fuel market study, the government is planning to launch its new Fuel Finder scheme by the end of the year. This will allow drivers to compare real-time fuel prices via navigation apps, in-car devices and comparison websites.

Increased transparency in pricing may push retailers to be more competitive in their pricing and help bring margins back down.

What’s next
The next major CMA report is due at the end of 2025 and will provide a deeper look at retailers’ operating costs. In the meantime, businesses and drivers alike will be watching closely to see whether the Fuel Finder scheme makes a dent in the high margins and helps bring more competition back to the pump.

To review the report in full, see: https://www.gov.uk/government/publications/road-fuel-quarterly-update-report-september-2025
 
Digital ID to Become Mandatory for Right to Work Checks
The government has announced its plan to introduce a new digital ID scheme, which will become the standard way to complete Right to Work checks by the end of the current Parliament.

The digital ID will be available to all UK citizens and legal residents and will be stored securely on mobile phones in the same way as the NHS App or contactless payment methods.

The new system should make compliance simpler for employers carrying out Right to Work checks. Guidance will follow as the roll-out progresses, with a consultation later this year to help shape how the service works.

The government has confirmed there will be options for people unable to use smartphones, and security will be built in through encryption and authentication technology.

For now, employers should watch for updates and prepare for digital checks becoming mandatory.

See: https://www.gov.uk/government/news/new-digital-id-scheme-to-be-rolled-out-across-uk
 
£150 Million Boost for Creative Industries Across the Regions
Creative businesses and freelancers outside of London could receive increased support following a government announcement aimed at accelerating growth in the sector.

Six regions with established strengths in film, TV, music, fashion and video games will each receive £25 million to grow their creative industries. The funding is part of the new Creative Places Growth Fund, first outlined in June’s Creative Industries Sector Plan.

£25 million each for six regions
The money will be spread equally across:

• Greater Manchester
• Liverpool City Region
• North East
• West of England
• West Midlands
• West Yorkshire

Culture Secretary Lisa Nandy confirmed that the allocations will be devolved to local Mayors, giving them scope to tackle regional challenges and opportunities in their community. The funding will be provided over three years, starting in the 2026 financial year.

£8 million in grants for SMEs today
Alongside the regional funding, more than 100 micro, small and medium-sized creative enterprises across 12 regions are receiving a share of £8 million in Create Growth Programme grants.

Grant sizes range from £20,000 to £140,000 and are designed to help firms commercialise new ideas and access resources, knowledge and private investment that will help them to scale up.

Some of the recipients include:

• Translating Nature, an art and design studio in Margate
• King Bee, an animation studio in Hertfordshire

Whether you’re in line for government support or not, if you run a creative business and would like help to see how you could grow and scale your business please get in touch. We would be happy to help you!

See: https://www.gov.uk/government/news/six-regions-receive-25-million-to-bolster-creative-industries

3rd October 2025 – Hillmans Weekly Update

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

Have a great weekend.

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

BUDGET 2025 DATE - 26 NOVEMBER

The Chancellor will deliver Autumn Budget 2025 on 26 November 2025. The content of the Autumn Budget is anticipated to address significant fiscal challenges, including potential tax rises to address the public finance deficit.
 
Before turning to Autumn Budget 2025, we must note that some of the ramifications of Autumn Budget 2024 are still to come. These include: 

• Capital Gains Tax (CGT) - in addition to the tax hikes that have already taken effect on 30 October 2024 and 6 April 2025, the rate of CGT where Business Asset Disposal Relief (BADR) applies is set to further increase from 14% to 18% from 6 April 2026.
• Inheritance Tax (IHT) - as initially announced in the last budget, IHT increases are already on the cards due to:
  • Restrictions on 100% relief for business and agricultural property from 6 April 2026.
  • The inclusion of unused pension funds and death benefits in IHT estates from 6 April 2027.

Now let’s consider some of the potential announcements in Autumn Budget 2025.
 
What’s unlikely to change?
 
Labour’s 2024 manifesto pledged that there would be no increases to National Insurance, the basic, higher or additional rates of Income Tax, or VAT. 
 
The Corporate Tax Roadmap of October 2024 also included commitments not to increase the 25% main rate of Corporation Tax and to retain the small profits rate and marginal relief. The £1 million annual investment allowance for plant and machinery capital allowances is also due to be preserved, as is the system of permanent full expensing.
 
Despite the government saying that extending frozen Income Tax thresholds any longer would hurt working people, it now seems inevitable that the thresholds will remain at their current levels until 5 April 2030, mirroring the time period for which IHT thresholds are frozen.
 
What could change? 

• The scope of National Insurance Contributions (NICs) could be widened to include landlords, levelling the playing field with those running their own trading business.
• Pension savings are currently afforded tax relief at the saver's marginal Income Tax rate (20%, 40% or 45%). The rate could be capped at, say, 30%.
• Salary sacrifice for additional employer pension contributions is currently exempt from the Benefit In Kind rules. Removing the exemption would make the contributions subject to NICs and Income Tax.
• The rates of CGT (currently 18% for basic rate taxpayers and 24% for higher/additional rate taxpayers) could be aligned with those for Income Tax, making the rate as high as 45%.
• There may be further restrictions to available IHT reliefs, possibly by introducing limits on exempt lifetime gifting.
• The VAT registration threshold, currently £90,000, may be lowered or abolished.
• The rate of VAT on domestic fuel is currently 5%. There are rumours that, in order to help with the cost of living crisis, such supplies will become zero-rated.

It isn’t possible to predict what the Chancellor will announce on 26 November, but it’s worth considering what may happen so you can be prepared. If you wish to discuss any of these issues in more detail, please get in touch – we’d be happy to help!
 
SPOTLIGHT ON UMBRELLA COMPANIES

While there is no legal definition, ‘Umbrella Companies’ is a term used to describe Employment Intermediaries that employ temporary workers who go on to work for different agencies and/or end clients (ultimate recipient of the services). Umbrella companies will often contract with recruitment agencies, who then source the work opportunities.
 
'Employment intermediaries' rules apply to staff and employment agencies:

• Agency workers are generally subject to PAYE and NICs on their earnings.
• The rules for determining employment status changed in 2014: workers who are supplied through an agency and are subject to (or to a right of) supervision, direction or control by any person will automatically be treated as employees.
• Special reporting instructions for employment intermediaries (agencies) who supply self-employed workers apply from April 2015. These make it difficult for agencies and other employment intermediaries to pay workers gross i.e. treating workers as being self-employed in their own right. Returns are to be completed from 6 April 2015 for each quarter ending 6 July, 6 October, 6 January and 6 April and late filing penalties apply.

In June 2025, HMRC released Spotlight 71: 'Warning for agency workers and contractors who are moved between umbrella companies'. This Spotlight highlights signs that agency workers and contractors should be aware of and that may indicate that the umbrella company they are engaged with is operating a tax avoidance scheme. 
 
HMRC highlight the areas where taxpayers should be extra vigilant if they are engaged with an umbrella company. Spotlight 71 can be viewed here.
 
VAT ERROR CORRECTION
 
Form VAT652 (Error Correction) was withdrawn on 8 September 2025. The form was used to notify HMRC of VAT return errors that could not be corrected on the next VAT return. The procedure for correcting VAT return errors is now as follows:
 
If you have discovered an error in a VAT return, the first step is to check whether the error can be amended in the VAT return for the period in which the error was discovered. Errors can be amended in the next VAT return if:
 

• The net errors, i.e. output VAT less input VAT errors, are less than £10,000; or
• The net errors are between £10,000 and £50,000 and less than 1% of the Box 6 figure for the VAT return in which the correction is being made.

HMRC have published a new service that allows taxpayers to check whether they need to notify HMRC of any errors on the VAT return – see here.
 
If the errors cannot be amended on the VAT return, they must be disclosed using HMRC’s online error correction service – the service can be accessed using the above link and it requires signing in using a Government Gateway user ID and password.
 
Those who cannot use the online service should notify the error to HMRC's Error Correction Team by post (BT VAT, HMRC, BX9 1WR) or by email (inbox.btcnevaterrorcorrection@hmrc.gov.uk).
 
If the error was a result of careless behaviour, HMRC is still entitled to charge penalties in the event that they discover it at a later date, even if it has already been adjusted on the VAT return. HMRC advise that including the adjustment on the return does not constitute a disclosure. This means that without also notifying HMRC using the online error correction service, unprompted penalties could still be charged. 
 
SIDEWAYS LOSS RELIEF DISALLOWED
 
In a recent First Tier Tribunal case, Charlotte MacDonald v HMRC, a taxpayer was denied sideways loss relief for losses that she had incurred when organising an annual 'woodland shoot' on an estate because the activities were not carried on with a view to the realisation of profits.
 
A taxpayer can offset trading losses against their general income in the year of the loss, the previous year, or both. In order to do this, the loss must have arisen from a trade that was carried on:

• on a commercial basis, and
• with a view to the realisation of profits of the trade.

HMRC argued that the shoot was not commercial in nature and that there had been no view to a realisation of profits.
The First Tier Tribunal found that the shoot was carried on on a commercial basis, in that it was not merely a hobby for the taxpayer. However, since the shoot had started, it had made a loss in every year except one. Barely any profit had been made in 15 years, and there was no reasonable expectation that a profit would be made. 
On this basis, the conditions for claiming sideways loss relief were not met and the appeal was dismissed.
 
ADVISORY FUEL RATES FOR COMPANY CARS
 
The table below sets out the HMRC advisory fuel rates from 1 September 2025. 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.
 
Advisory Fuel Rates

• Petrol
  • 1400cc or less: 12p (12p)
  • 1401cc to 2000cc: 14p (14p)
  • Over 2000cc: 22p (22p)
• Diesel
  • 1600cc or less: 12p (11p)
  • 1601cc to 2000cc: 13p (13p)
  • Over 2000cc: 18p (17p)
• LPG
  • 1400cc or less: 11p (11p)
  • 1401cc to 2000cc: 13p (13p)
  • Over 2000cc: 21p (21p)

Previous rates are shown in brackets.
 
You can also continue to use the previous rates for up to 1 month from the date the new rates apply.
 
Note that for hybrid cars, you must use the petrol or diesel rate.
 
For fully electric vehicles the rate is 8p (7p) per mile where the vehicle is charged at home. The rate applicable to vehicles charged using public facilities is 14p per mile. This is the first time there is a separate rate depending on where the car is charged.
 
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. Note that for NIC purposes the employer can continue to reimburse at the 45p rate as the 10,000 mile threshold does not apply.
 
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, 2 pence per mile can be reclaimed as input VAT (12p x 1/6).