On 26 March 2025, the Chancellor presented her Spring Statement to parliament. Despite a backdrop of low economic growth and increasing government borrowing costs, the Chancellor remains committed to her ‘non-negotiable’ fiscal rules announced last October.
Thus, from 6 April 2025 …
- National Insurance Contributions (NICs) paid by employers increases by 1.2% to 15%. To soften the blow the threshold at which an employer starts to pay NICs on each employee’s salary reduces to £5,000 and the ‘employment allowance’ which eligible employers can offset against their employers’ NICs liability increases by £5,500 to £10,500. The definition of eligible employers has changed, have you checked if you are eligible to claim?
- If you are selling your company shares, your business assets or your partnership interest, the rate of Capital Gains Tax (CGT) on qualifying disposals has increased by 4% to 14%, if you are eligible to claim Business Asset Disposal Relief (BADR). A further uplift to 18% is planned for 6 April 2026. Timing of business disposals is important, please do talk to us about optimising your tax position early on in the negotiations.
- Don’t forget that, for most sales of capital assets, CGT will apply at 18% for basic rate taxpayers and 24% otherwise.
- If you are purchasing residential property in England and Northern Ireland, Stamp Duty Land Tax (SDLT) has increased; a new threshold which is applied to £125,000 – £250,000 of the purchase price will be liable to SDLT at 2%. For first-time buyers, the 0% rate has reduced to £300,000 and 5% thereafter (for properties costing up to £500,000). Unless you are replacing your home, a SDLT surcharge of 5% applies to purchasers of ‘additional dwellings’.
- The late payment interest rate for unpaid tax liabilities will now stand at 8.5%. Going forward, this rate will be calculated as the Bank of England base rate plus an additional 4%. This update underscores the critical importance of staying on top of your tax affairs and planning ahead to budget for any tax liabilities effectively.
- The Child Benefit income thresholds have increased. If your income is over £60k, it will be clawed back at £1 for every £200 of income above £60,000 (and fully clawed back where income exceeds £80,000). From this summer, if you are an employee who is liable to pay the ‘High Income Child Benefit Charge’ you will be able to use a new digital service to declare the charge and opt to pay it directly through PAYE, without the need to register for self-assessment.
- HMRC’s ‘Making Tax Digital for Income Tax’ (‘MTD for IT’) initiative will initially apply from 6 April 2026 for sole traders and property landlords who generated gross trade and rental income (‘qualifying income’) of more than £50,000 in the 2024/25 tax year. We’re contacting our clients to help them prepare for MTD, call us if you need help to prepare.
The Spring Statement was an economic update given in challenging circumstances, in what was regularly referred to as a ‘changing world’. We are here to work alongside you to help you navigate your way – please do get in touch on 01223 810100 if there is anything that you would like to discuss.
