Autumn Budget 2025: facing the future

your complete guide to every key change

The Autumn Budget 2025 arrives at a critical moment for the UK economy. After years of inflationary pressure, rising borrowing costs, and ongoing demands on public services, the Chancellor’s message this year is one of caution, recalibration, and long-term restructuring.

Rather than offering headline-grabbing tax cuts, this Budget signals a shift toward a more sustainable and fair fiscal framework, one that seeks to raise revenue while supporting public investment and reshaping the way Britain taxes income, savings, and wealth.

economic and fiscal landscape
The government’s fiscal plans are anchored in expectations of modest but steady economic growth. Budget projections point to improving stability, supported by infrastructure investment and gradual productivity recovery.

At the same time, the Office for Budget Responsibility forecasts the UK tax burden will rise to around 38% of GDP by the end of this Parliament, a historic high that underlines the government’s revenue-raising approach while maintaining essential public spending.

The Chancellor also reaffirmed a commitment to reducing day-to-day borrowing and placing debt on a downward path. These fiscal rules explain the absence of major tax cuts in the short term.

personal taxation: the quiet squeeze continues
Income tax thresholds remain frozen, extending fiscal drag as wage growth pushes more earners into higher tax bands. National Insurance remains unchanged for now, though simplification remains on the government’s agenda.

Dividend tax thresholds also stay frozen, and the planned reduction of the Dividend Allowance from April 2026 is still on course, tightening the landscape for investors and owner-directors who rely on dividend income.

pensions and savings: a defining shift for higher earners
From 2029, a £2,000 cap will apply to salary-sacrifice pension contributions before National Insurance becomes payable. This marks a significant change for higher earners and is expected to raise £4.7 billion by 2029/30.

The 25% tax-free pension lump sum remains untouched for now, though pension reform continues to be an area under review.

While speculation surrounded potential ISA allowance cuts, the Budget confirmed instead a broader ISA review in 2026, signalling that changes may still lie ahead.

property, wealth, and capital taxes
A new surcharge on properties valued above £2 million was announced, with full details to follow. The direction is clear: a greater share of the tax burden is shifting toward wealth and high-value assets.

Capital Gains Tax rates remain unchanged, but allowances continue to reduce. Reliefs for second homes and property portfolios will also be reviewed, raising future costs for landlords and investors.

business and corporate taxation
Corporation Tax remains at 25%, with no increases signalled. Importantly, full expensing has now been made permanent, allowing businesses to deduct 100% of qualifying investment from taxable profits.

R&D incentives have been expanded, particularly for SMEs in science, technology, AI, and advanced manufacturing. A new Innovation Allowance will further support early-stage growth.

Business rates reform will introduce more frequent revaluations, while targeted support for retail and hospitality continues through 2025/26.

public services and infrastructure
Despite fiscal tightening, public investment remains central. Additional NHS funding will focus on digital modernisation, while transport, housing, energy networks, and green projects receive long-term backing.

cost of living measures
Benefits and Universal Credit will rise with inflation from April 2026. Energy support continues for vulnerable households, and the rollout of 30-hour free childcare expands further for working families.

a subtle but significant shift in the tax system
While not dramatic, this Budget represents a meaningful recalibration, tightening reliefs, taxing income and wealth more evenly, and prioritising long-term stability over short-term wins.

For individuals, investors, and business owners, forward planning has never been more important. Understanding these changes now is key to navigating the UK’s evolving tax landscape.

need help navigating the autumn budget 2025?
If you’re unsure how these changes affect your tax position, business strategy, or long-term planning, our expert advisors are here to help.

Speak to DAS Accounting & Partners for personalised tax planning, business advisory support, and strategic guidance.

Get in touch today to discuss how the Autumn Budget 2025 impacts you and how to stay ahead of the changes.

Wealth transfer strategies for high-net-worth individuals

practical steps to pass on wealth tax-efficiently.

Intergenerational wealth planning is most effective when tax, investment, family governance, and timing work together. This guide sets out practical options using current UK rules and allowances. It explains how to combine annual exemptions and larger lifetime gifts, where trusts and family investment companies can help, and why pensions continue to be central after the lifetime allowance changes.

It also covers portfolio tactics for capital gains, opportunities for business and agricultural reliefs, and the role of structured philanthropy. For internationally mobile families, we highlight the shift to the new foreign income and gains regime and the move towards residence-based inheritance tax (IHT) exposure – so timing and residence decisions can be taken with eyes open.

set clear goals before you optimise tax
Start by writing down the outcomes you want over a 10–20 year horizon:

• Who should benefit, when, and with what guardrails?
• What income does the donor need to retain, now and in later life?
• Which assets are suitable for lifetime gifts, and which are better held until death?
• What level of administrative complexity, cost, and investment risk is acceptable?

Agree these principles with family members who will be involved. It reduces friction later and guides choices between gifts, trusts, pensions, companies, and philanthropy.

lifetime gifting: use exemptions first
Lifetime gifts reduce the taxable estate and can move growth to the next generation.

core exemptions – simple, repeatable

• Annual exemption: Give up to £3,000 each tax year (carry forward one year if unused). Small gifts up to £250 per recipient are separate. Wedding gifts are exempt up to £5,000 (child), £2,500 (grandchild) or £1,000 (others).
• Normal expenditure out of income: Unlimited gifts from surplus income are immediately IHT-exempt if they are part of a pattern, come from income (not capital), and do not reduce your standard of living. Keep clear records of income, spending, and regular gifts.

Potentially exempt transfers (PETs): Gifts to individuals are outside IHT if the donor survives seven years. If death occurs within seven years, taper relief can reduce tax on the gift after year three. PETs remain a mainstay for large transfers where control via trusts is not required.

practical tips

• Prioritise assets with strong growth prospects so future gains occur outside the estate.
• Consider capital gains on disposal; use the £3,000 capital gains tax (CGT) exemption each year and re-base asset costs across the family where appropriate.
• Document intent and keep a simple gift ledger; it speeds probate and reduces HMRC queries.

trusts: control, protection and targeted reliefs
Trusts can separate economic benefit from control, protect vulnerable beneficiaries, and support long-term governance. However, relevant property trusts face entry (20%), 10-yearly, and exit charges above available nil-rate band (NRB) and share the donor’s £325,000 NRB across related settlements.

Trusts remain powerful, but should align with clear purposes (education, housing, protection) and be sized for expected charges.

Residence nil-rate band (RNRB) planning: Watch estate values around £2m due to tapering of the RNRB. In some cases, lifetime gifts that bring the estate below £2m can restore some or all of the £175,000 RNRB on death.

Business and agricultural reliefs: Qualifying business property and certain AIM/unquoted shares can secure 100% or 50% IHT relief after a two-year holding period, subject to trading tests and excepted asset rules. Relief is generous but not automatic; due diligence on trading status and evidence of ownership periods is essential.

From 6 April 2026, a combined £1m allowance for the 100% rate of business and agricultural property relief applies per individual, with unused allowance transferable to a spouse or civil partner. Amounts above £1m get relief at 50%.

family investment companies: where do they fit?
Family investment companies (FICs) can help retain control, centralise investment management, and pass value via growth shares to heirs, with transfers taxed under CGT/IHT rather than income. They work best when:

• you plan to retain capital, not distribute heavily in the near term (to avoid double taxation)
• you have a clear share class design (for example, voting “founder” shares, non-voting growth shares for heirs)
• you accept ongoing company compliance and dividend extraction rules

FICs don’t attract specific IHT reliefs, but can sit alongside trusts (such as a trust holding growth shares) to combine control with protection. Obtain corporate, tax, and legal advice before implementation.

pensions: still central to intergenerational planning
Pensions continue to be a tax-efficient wrapper for growth and income, with added estate-planning features.

contributions and reliefs

• Contribute up to £60,000 (subject to earnings), with carry-forward available from the previous three years. Tapering applies from adjusted income £260,000, down to a £10,000 minimum. If you have flexibly accessed defined contribution (DC) benefits, the money purchase annual allowance (MPAA) caps DC contributions to £10,000.
• From April 2029, NIC relief on pension contributions made via salary sacrifice will be capped at £2,000 a year, which may reduce the appeal of very large sacrifice arrangements.

new allowances replacing the lifetime allowance

• Lump-sum allowance (LSA): £268,275 caps tax-free pension commencement lump sums across all schemes.
• Lump-sum and death-benefit allowance (LSDBA): £1,073,100 caps tax-free lump sums, including certain death benefits; amounts above these limits are taxable at the beneficiary’s marginal rate when taken as lump sums. Transitional protections may adjust these figures for some individuals.

death benefits

• Generally, where death occurs before age 75, beneficiary drawdown or lump sums are free of income tax; on/after 75, they are taxed at the recipient’s marginal rate. From 6 April 2027, most unused pension funds and certain death benefits will fall within the estate for IHT. Budget 2025 confirms new rules allowing executors to ask schemes to withhold up to 50% of taxable death benefits for up to 15 months to meet IHT, and to discharge executors from IHT on pension rights discovered after HMRC clearance. Review nominations and estate liquidity well before that date.

planning pointers

• High earners should test the affordability of maximising allowances in the years before retirement, using carry-forward where available.
• Coordinate pension withdrawals with ISA funding and broader gifting strategy.
• Keep your expression of wishes up to date so scheme administrators can pay benefits quickly and as intended.

charitable giving: efficient tools for impact
Philanthropy can advance family values and reduce tax.

• Relief is now focused on UK charities: Gift Aid and, from 2025/26, the main IHT charity exemptions apply to direct gifts to UK charities and qualifying clubs.
• Gifts of quoted shares, land or property to charity attract income tax relief at market value and no CGT, in addition to IHT relief for lifetime and death-bed gifts.
• Donor-advised funds (DAFs) provide a flexible alternative to setting up a charity, allowing an immediate tax deduction followed by staged grants over time under your family’s guidance.
• If you support non-UK charities or use cross-border structures, review your plans – IHT relief will generally be limited to direct gifts to UK charities from late 2025/early 2026.

Consider including charitable legacies in your will. Where 10% or more of the net estate passes to charity, the estate may qualify for the 36% reduced IHT rate.

entrepreneurial and growth-capital reliefs
High-net-worth individuals who back early-stage companies can combine succession aims with growth capital:

• SEIS: 50% income tax relief on up to £200,000 per year, partial CGT reinvestment relief, minimum three-year holding, high risk and strict qualifying rules.
• EIS: 30% income tax relief up to £1m (or £2m where at least £1m is in knowledge-intensive companies), CGT deferral or exemption may be available, minimum three-year holding.
• VCTs: Currently 30% income tax relief on new subscriptions up to £200,000 a year, scheduled to reduce to 20% for investments from 6 April 2026, with dividends and gains remaining tax-free if conditions are met and shares are held at least five years.

These vehicles are illiquid and higher risk; use them to complement, not replace, diversified core assets.

property and portfolio design for multi-generational aims
Property choices: Consider how much housing wealth you want embedded in the taxable estate. Downsizing, family co-ownership structures, or gifting deposits can align homes with succession goals. Where the RNRB applies, ensure the will passes a qualifying interest in the main residence to direct descendants and watch the £2m taper threshold.

From 2028, owners of English residential properties over £2m will face a High Value Council Tax Surcharge, which may influence decisions on holding or restructuring high-value homes.

Tax-aware portfolio withdrawals: Many high-net-worth households draw ISAs first (tax free), then pensions, then general investment accounts. For intergenerational aims, this order may flip: keeping pensions invested (subject to the 2027 IHT change) while using ISA and general investment account funds to support gifts or trust funding can sometimes improve the family-level outcome.

Revisit this annually. The Autumn Budget 2025 increases tax rates on dividends, savings income, and (from 2027) property income, which may tilt the balance further towards using pensions and ISAs as long-term wrappers.

CGT management: Use the £3,000 exemption each year; spread disposals across spouses/civil partners to use two allowances and two basic-rate bands where possible. Consider bed-and-ISA or bed-and-spouse tactics to re-base holdings and improve future flexibility.

cross-border families after the 2025 reforms
The new foreign income and gains (FIG) and residence-based IHT rules mean domicile is less relevant. Planning now focuses on:

• timing of UK residence and the first four-year window for FIG
• the long-term resident IHT test, which brings worldwide assets into scope after sustained UK residence
• the treatment of offshore trusts and whether historic structures still meet your objectives

Inbound or returning families should build a residence, remittance, and IHT roadmap at least a year before moving. Outbound families should understand the tail period for continued UK IHT exposure after departure.

Budget 2025 adds further offshore anti-avoidance rules, including for temporary non-residents and some historic excluded property trusts, so existing cross-border structures should be reviewed in detail.

wills, letters of wishes and family governance
Tax efficiency fails if legal documents do not reflect your intent. Review the following:

Preparing for a UK Business Exit

August 2025

Selling or passing on your business is one of the biggest financial events you will ever face. The decision to step away from a company you have built carries significant cash, tax and lifestyle consequences. With the right groundwork, you can structure the deal to meet your goals, move funds into vehicles that match your risk appetite and leave enough liquidity for life after work.

Early preparation also gives you time to resolve any compliance issues, strengthen your accounts and present a track record that attracts the highest possible price. By modelling different deal options now, you can see how each one affects your net proceeds, pension limits and inheritance-tax position. Planning ahead lets you use reliefs that are still available – such as business asset disposal relief and the frozen income tax thresholds before any future Budget changes them. It also allows your family to understand the financial shape of the transaction and to update wills, trusts and insurance where needed.

This guide explains the practical steps to follow, from setting objectives to investing the proceeds, and highlights the tax rates, allowances and valuation trends that apply in the 2025/26 UK tax year. We hope it gives you a clear starting point and prompts the conversations that will lead to a smooth, profitable exit.

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How to Ensure Financial Success

Set Clear Objectives Long Before You Market the Company

Most owners think first about headline price, but three other factors deserve equal weight.

• Deal structure: Will you accept staged payments, an earn-out or a loan-note element? Earn-outs featured in more than 60% of UK small or medium-sized enterprise (SME) transactions reported by BDO during 2024, mainly to bridge price expectations in a volatile market. Staged payments shift risk: you may pay less tax up front, but you rely on the buyer’s future performance.
• Post-sale income: Draw up a personal cashflow forecast that covers at least 20 years. Include inflation and remember that the full new state pension is £230.25 a week in 2025/26.
• Legacy: Decide whether you want the business to remain independent, merge with a larger group or become employee-owned. More than 2,250 UK companies are now employee-owned, up from fewer than 150 in 2014, showing the model’s growing appeal.

Putting these goals on paper early gives your advisers a clear brief and avoids late-stage disagreements among shareholders.

Understand How Buyers Will Value You

Private-company acquirers usually apply an earnings multiple-most often applied to EBITDA (earnings before interest, taxes, depreciation and amortisation)-adjusted for non-recurring items. The median EBITDA multiple for UK SMEs rose to 5.4 × in 2024, up from 5.0 × the year before, reflecting stronger buyer confidence. A robust valuation exercise should:

• normalise earnings (for example, remove one-off Covid grants or founder salaries above market rate)
• highlight growth drivers, such as recurring revenue or protected intellectual property
• benchmark the resulting profit against sector peers so that buyers focus on performance, not perception.

In certain instances where EBITDA is not deemed the most appropriate metric, turnover or discounted future cashflows may instead be used.

Put Your Records in Order and Pre-Empt Due Diligence Questions

Buyers usually ask for five years of data. Common stumbling blocks include deferred VAT, undocumented research and development (R&D) claims and missing employment contracts. Tackling these in advance avoids price chips later and signals professionalism.

Area-Typical buyer question-Pre-sale action we recommend

• Revenue recognition – Are sales booked when performance obligations are met? – Align policies with IFRS 15 or FRS 102 and document cut-off procedures.
• Tax compliance – Are all HMRC returns filed and liabilities paid? – Download the latest statements for corporation tax, VAT and PAYE from HMRC’s online services at least six months before marketing. Having PDFs that show nil or fully reconciled balances reassures buyers that all filings and payments are up to date.
• Share options – Do unexercised options dilute value? – Verify that all EMI options remain qualifying and fully compliant: check that the original grant was notified to HMRC on time, that the annual ERS returns up to the most recent 6 July have been filed, and confirm no disqualifying events have arisen. Where a past notification was missed, use HMRC’s late-registration procedure or consider granting fresh qualifying options.

A written “data-room index” that lists every file, folder and version helps keep the sales process on track and reduces professional-fee overruns.

Know Your Personal Tax Bands and Allowances for 2025/26

Allowance or band	2025/26 figure
Personal allowance	£12,570
Basic-rate band (20%)	£12,571-£50,270
Higher-rate band (40%)	£50,271-£125,140
Additional-rate band (45%)	over £125,140
Dividend allowance	£500
CGT annual exempt amount	£3,000

Note: Different figures apply for Scotland.

All thresholds are frozen until at least April 2026, which means fiscal drag is pushing more income into the 40% and 45% bands each year. If you expect part of the sale consideration to be paid across two tax years, you may be able to use two sets of allowances.

Capital Gains Tax on a Share Sale

From 6 April 2025 the CGT rates on most assets are 18% within the basic-rate band and 24% above it. Residential property sales attract the same rates.

Business asset disposal relief (BADR)

• Lifetime limit: £1m
• Rate: 14% for disposals on or after 6 April 2025
• Qualifying period: two years of 5% shareholding and voting rights.

If you expect to make several qualifying disposals, consider whether accelerating one or more completions before 6 April 2026 could save tax. Gains that complete up to 5 April 2026 are taxed at 14%; from 6 April 2026 the Business Asset Disposal Relief rate on qualifying gains within your £1 million lifetime allowance is scheduled to rise from 14% to 18%. Gains that exceed the £1 million limit will instead be taxed at the standard CGT rates (currently 18%/24%). If you expect to realise more than £1 million of qualifying gains, consider whether accelerating part of the sale before 6 April 2026 could reduce the tax on the first £1 million.

Corporation Tax Steps Before You Advertise the Sale

The main corporation tax rate is 25% for profits above £250,000. Companies with profits of £50,000 or less still pay 19%, with marginal relief in between. Practical ways to reduce the effective rate include the following.

• Full expensing: A £500,000 qualifying plant purchase made now saves £125,000 in tax at 25%. The cash benefit shows up in headline EBITDA and, by extension, in the deal multiple.
• Pension contributions: Company payments cut profits and are exempt from employer national insurance contributions (NICs). A £60,000 contribution costs the company £45,000 net after tax, but credits your pension with the full amount.

Watch associated-company rules if you have more than one trading or property subsidiary; grouped profits can push you into the 25% bracket earlier than expected.

Optimise Remuneration and Pensions in the Past Two Trading Years

• Annual allowance: The allowance is £60,000. A taper starts at adjusted income of £260,000 and can reduce the allowance to £10,000.
• Lump-sum allowance: You can normally take up to £268,275 tax free after the lifetime allowance was abolished in April 2024.

Bonus or dividend?

• Corporation tax rate: A bonus reduces taxable profits, saving corporation tax at up to 25% – but it also incurs employer National Insurance at 15%.
• Personal tax band: Above the £50,270 upper-earnings limit, employee NIC falls to 2%; below it, the 8% rate often tips the balance in favour of dividends.
• Dividend allowance: The first £500 of dividends in 2025/26 is tax-free, slightly improving the dividend outcome.
• Cashflow needs and pension strategy: Salary can be sacrificed into pensions NIC-free; dividends cannot.

Consider a Holding Company or a Family Investment Company

A UK holding company can receive the sale proceeds free of CGT under the substantial shareholding exemption if it has held at least 10% of the trading subsidiary for one year. You then control the pace at which cash comes out – either as dividends over several years or as a capital reduction subject to CGT at your marginal rate. The structure is also helpful if you want to reinvest part of the proceeds in a new venture without paying tax twice.

A family investment company (FIC) lets you:

• gift non-voting shares to adult children while keeping control of voting shares
• ring-fence growth outside your estate for inheritance tax (IHT)
• pool family wealth in a single, professionally managed portfolio.

IHT After the Sale: Manage the Proceeds Safely and Efficiently

1. Bank security: The Financial Services Compensation Scheme covers £85,000 per person per banking licence. Split large balances across several institutions and consider National Savings & Investments for further protection.
2. Quick diversification: Move surplus cash into short-dated gilt funds or Treasury bills while you design a long-term portfolio. Gains on gilts are CGT-free for individuals.
3. Tax shelters: Fund ISAs (£20,000 each per tax year) and top up pensions if you still have annual allowance space.

IHT allowance	2025/26 figure	Frozen until
Nil-rate band	£325,000	April 2030
Residence nil-rate band	£175,000	April 2030

Business property relief (BPR) at 100% applies to shares in an unquoted trading company held for two years, but it falls away once you hold cash. To reinstate protection you can:

• buy AIM shares that qualify for BPR (higher risk)
• invest in enterprise investment scheme (EIS) shares or a venture capital trust (VCT)
• settle cash into a discretionary trust and survive seven years.

The Autumn Budget 2024 confirmed that from 6 April 2026 the 100% rate of BPR will be limited to the first £1m of combined business and agricultural property. Anything above that limit will qualify for relief at 50%. If your estate includes trading shares or other qualifying assets worth more than £1m, consider completing transfers or restructuring before 5 April 2026 while full relief is still available.

Keep an Eye on Market Activity

• The Office for National Statistics recorded 316,000 business births and 309,000 deaths in 2023, the slowest net creation since 2010.
• Buy-side appetite remains strong for established, profitable firms, reflected in the 5.4 × median EBITDA multiple noted earlier.

Fewer startups and the higher cost of new debt mean strategic buyers often prefer to acquire rather than build, which supports pricing for well-run companies.

Exit Timetable: Suggested Milestones

Months before exit	Action and detail
36+	Agree objectives; benchmark valuation; check share options; identify potential successors inside or outside the business.
24	Launch tax health-check; ensure you meet the two-year BADR and BPR holding periods; tidy working-capital policies.
18	Optimise remuneration; settle director’s loan accounts; consider pre-sale capital allowances claims.
12	Build electronic data room (contracts, property titles, IP registers); prepare detailed five-year forecasts.
6	Negotiate heads of terms; request HMRC clearance for share-for-share exchanges or de-mergers if relevant.
Completion	Finalise sale and purchase agreement; confirm proceeds routing into pension/FIC/holding company.
Post-sale	Implement investment strategy; update wills, lasting powers of attorney and shareholder agreements.

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Next Steps

An exit is not just a transaction; it is the point at which years of effort turn into capital that must support the next stage of your life. By starting the process two to three years out, you give yourself time to optimise tax reliefs, improve valuation metrics and build a post-sale investment plan that matches your goals. If you are even thinking about a sale within that horizon, please contact us for an exit-readiness review. We will map out key dates and make sure every pound of value ends up where you want it – working for you and the people who matter to you.

DAS Accounting Services UK
105 Eade Road, OCC Building A, Second Floor, Unit 11a, London, N4 1TJ
info@dasaccounting.co.uk • 020 8396 7353

 

HMRC intensifies scrutiny of R&D tax claims

HMRC has significantly increased oversight of research and development (R&D) tax relief, with errors in claims totalling £441 million in 2023/24. In 2024, one in five claims faced an enquiry, compared with just one in 20 two years earlier.

The compliance crackdown includes creating a specialist anti-abuse unit, which added 300 staff to HMRC’s small business compliance team. Around 500 officers now focus on detecting errors and fraud in R&D claims.

Two new measures are also raising the bar. The additional information form (AIF) requires claimants to submit detailed project and cost breakdowns upfront. At the same time, the mandatory random enquiry programme (MREP) increases the likelihood of investigations, even for fully compliant claims.

There are three key steps to reduce risk.

• Strong documentation is the best defence in an enquiry. Businesses should ensure they track project milestones, staff time and costs using reliable systems, and back up claims with payroll data, invoices and receipts.
• Compliance should not be a last-minute task. With regular reviews and early preparation, accountants can guide clients to embed good practice throughout the year.
• Rejected claims damage cashflow and confidence. Businesses that combine robust documentation with technical expertise and innovative tools put their clients in the best position.

With increasing enquiries, preparation and accuracy are essential for every R&D claim.

Talk to us about your R&D claim.

Making Tax Digital for Income Tax

HMRC are introducing a new regime called Making Tax Digital for Income Tax (MTD for ITSA) from April 2026. The changes will affect unincorporated sole traders and landlords and will alter how income information is reported to HMRC.

While reporting obligations will become more frequent, the timing of tax payments will broadly remain the same. Most taxpayers will still pay income tax once or twice a year, in line with the current self-assessment system.

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What Is Making Tax Digital for Income Tax?

If you are an unincorporated sole trader or landlord with combined qualifying turnover of £50,000 or more, you will be required to submit income records to HMRC on a quarterly basis using HMRC-approved software.

From April 2027, the regime will be extended to include unincorporated sole traders and landlords with turnover of £30,000 or more.

What Will Change Under MTD?

Quarterly Submissions

Income records will need to be submitted quarterly rather than once per year. From April 2026, the submission deadlines will be:

• 7 August
• 7 November
• 7 February
• 7 May

At the end of the tax year, a final tax declaration must be submitted by 31 January following the end of the tax year. Adjustments can be made at this stage. This final declaration will replace the current annual self-assessment tax return.

As with the existing system, tax will usually still be paid once or twice a year.

HMRC-Compatible Software

From April 2026, taxpayers within the MTD regime will only be able to submit information to HMRC using approved software. Manual submissions outside approved systems will no longer be permitted.

How Do I Know If I Am Affected?

If your 2024/25 self-assessment tax return (submitted by 31 January 2026) shows qualifying turnover of more than £50,000, HMRC will contact you to confirm that you must comply with Making Tax Digital from 6 April 2026.

If your combined turnover from property and/or self-employment is below £50,000, you will not be required to comply from April 2026. However, all unincorporated sole traders and landlords with turnover exceeding £30,000 will fall within the regime from April 2027.

HMRC may also issue ‘pre-mandation’ letters from April 2025 where they believe taxpayers are likely to fall within the new regime. An online checker tool is available to confirm whether you qualify.

What Happens If I Do Not Comply?

Making Tax Digital is mandatory. If you are required to submit quarterly updates, you will no longer be able to file using the annual alternative method.

HMRC will operate a points-based penalty system. Once a specified number of points is reached, an automatic £200 fine will be issued. Points can arise from both late submissions and late payments and remain valid for two years.

Following a penalty, HMRC requires a 12-month period of full compliance before points are removed. A one-off fine may also apply where compatible software is not used.

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How We Can Help

Making Tax Digital represents a significant change for many sole traders and landlords. Early preparation can help ensure compliance, reduce disruption, and avoid penalties. If you would like support with software selection, record-keeping, or quarterly submissions, please contact us.

DAS Accounting Services UK
105 Eade Road, OCC Building A, Second Floor, Unit 11a, London, N4 1TJ
uk@dasaccounting.com • 020 8396 7353

 

The Let Property Campaign

The Let Property Campaign gives taxpayers an opportunity to bring their tax affairs up to date if they are individual landlords letting out residential property in the UK or abroad, and to obtain the best possible terms for paying the tax they owe.

The Let Property Campaign is a scheme offered by HMRC to encourage landlords with undeclared rental income to come forward and make a voluntary disclosure. HMRC’s connect system and the wider data sources available to HMRC are increasingly likely to identify undeclared property income, which can lead to higher penalties and, in some cases, public naming.

In our experience, many landlords hesitate because they assume the tax liability will be higher than it needs to be. However, once the position is reviewed properly and allowable expenses and reliefs are taken into account, the overall liabilities are often lower than anticipated.

We have helped a large number of new clients make full disclosures to HMRC under the Let Property Campaign. We would encourage any landlords with undisclosed income to come forward for peace of mind before HMRC approaches them first. If you have any undeclared properties, we can support you through the disclosure process and help keep penalties and interest to a minimum.

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Next Steps

If you are a landlord considering making a disclosure, or you have received a letter from HMRC, please contact us. We can guide you through the process and help you reach the best possible outcome.

DAS Accounting Services UK
105 Eade Road, OCC Building A, Second Floor, Unit 11a, London, N4 1TJ
uk@dasaccounting.co.uk • 020 8396 7353

 

US LLCs and UK Tax: what every cross-border business owner should know

If you’re a UK resident who owns a US LLC, you’re in a unique position that offers both opportunity and complexity, especially when it comes to tax. While setting up a Limited Liability Company (LLC) in the US is often praised for its flexibility and ease, failing to understand how it’s treated for UK tax purposes can lead to unintended, and costly, consequences.

At DAS, we regularly help clients navigate this exact situation. Here’s what you need to know.

US vs UK Tax Treatment: A Fundamental Mismatch
In the United States, LLCs are usually treated as “pass-through” or “flow-through” entities. That means the LLC itself doesn’t pay tax on its income, instead, the profits are reported and taxed on the personal tax returns of the members (owners).

However, the UK doesn’t automatically see things the same way. HMRC typically treats US LLCs as “opaque” entities, similar to corporations. This means profits are taxed at the company level, and then again when distributed, potentially resulting in double taxation for UK-resident owners.

The Anson v HMRC Case: A Turning Point, or Is It?
In 2015, the UK Supreme Court ruled on the case of Anson v HMRC. Mr. Anson, a UK resident and member of a US LLC, successfully argued that the LLC’s income was attributable to him directly, entitling him to a foreign tax credit in the UK for the US taxes paid.

While this was hailed as a landmark decision, it’s crucial to understand the limits of its impact:

• The ruling was highly fact-specific, based on the exact structure and operating agreement of the LLC in question.
• HMRC has not changed its general stance: it still treats most US LLCs as opaque, unless strong evidence shows the LLC is legally transparent.

In other words, unless your LLC closely mirrors the facts of the Anson case, you cannot rely on this ruling alone to avoid double taxation.

What This Means for You
If you’re a UK tax resident who owns a US LLC, you’re likely to face:

• No automatic foreign tax credit in the UK for US taxes paid on LLC income
• Potential double taxation on the same income
• Complex reporting obligations in both jurisdictions

But with careful structuring and professional advice, there are ways to reduce or even eliminate these issues.

How DAS Can Help
At DAS, we specialize in helping UK-based owners of US LLCs make sense of the rules, align their structure with best practices, and ensure tax compliance in both jurisdictions.

Whether you’re just setting up your LLC or you’ve already been operating for years, we can:

• Review your LLC operating agreement and structure
• Liaise with qualified tax professionals in both countries
• Help you determine if your setup could qualify for “Anson-like” treatment, or recommend more efficient alternatives

Don’t Leave It to Chance, Make Your Setup “Anson-Proof”
Every business is different. Even small structural changes can have a major impact on how your income is taxed. Let us help you build a cross-border business that works for you, not against you.

Contact DAS today to book a consultation and ensure your US LLC is compliant, efficient, and tailored for success.

US Tax Season 2025: what you need to know

We’re officially in the thick of tax season, and as every CPA knows, this time of year brings long days (and even longer nights). At our firm, we’re hard at work ensuring that every client’s return is filed with accuracy, care, and on time. Whether you’re an early filer or just now getting your paperwork in order, we’re here to help guide you through the process.

is everything in order?
If you haven’t already, now is the time to gather all your tax documents: W-2s, 1099s, investment statements, and any deductions or credits you plan to claim. Having everything ready to go can help minimize stress and reduce the risk of errors or delays.

Even if you plan to file for an extension, remember: an extension gives you more time to file, not more time to pay. Any taxes owed are still due by the April deadline unless you qualify for a special exemption.

special relief for california taxpayers
This year, there’s some important news for California residents. In response to the devastating wildfires that have impacted many communities across the state, both the IRS and the California Franchise Tax Board (FTB) have granted automatic filing and payment extensions. Affected taxpayers now have until October 15, 2025, to file and pay their 2024 taxes.

This relief applies not only to those directly affected by the fires, but also to individuals in adjacent areas including much of Los Angeles –  who may have experienced disruptions or hardships as a result. If you’re unsure whether you qualify for the extension, we can help determine your eligibility and guide you through the necessary steps.

what’s next at the firm?
Behind the scenes, we’ve been working on a few exciting new developments that we can’t wait to share with you. While we can’t say too much just yet, stay tuned for announcements in the coming weeks we think you’ll like what’s on the horizon.

need help? let’s talk.
Tax season can be stressful, but you don’t have to go it alone. Whether you have a simple question or a more complex situation, we’re always just a call or message away. Our goal is to make tax time as smooth and painless as possible for you and your family.

And to all our fellow CPAs out there grinding through the season: hang in there! Your hard work makes a big difference.

Most See No Gains from MTD for Income Tax

A new survey has indicated that most businesses and agents see little benefit in Making Tax Digital for income tax (MTD IT), despite rising awareness.

The Administrative Burdens Advisory Board’s 2025 Tell ABAB report found awareness of MTD IT increased to 46.4% in 2025 from 33.3% in 2024. However, respondents largely expect higher costs and time pressures, with a majority anticipating no benefits. The survey received 3,146 responses, with 77% from businesses and 23% from agents.

The findings arrive ahead of mandation from April 2026 for sole traders and landlords whose 2024/25 self assessment includes combined gross income from self-employment and property above £50,000. HMRC has begun notifying affected taxpayers by letter, with the first batch sent to those who filed returns by the end of August 2025. Further mandation letters are scheduled for February and March 2026, and letters prompting unrepresented taxpayers were planned for late November 2025.

While the report notes growing familiarity with MTD, many respondents remain sceptical about net gains and flag wider concerns around administrative burdens. Businesses preparing for 2026 should review eligibility, ensure compatible record-keeping, and consider software and process changes well in advance of the start date.

Talk to us about your taxes.

DAS Accounting Services UK
105 Eade Road, OCC Building A, Second Floor, Unit 11a, London, N4 1TJ
info@dasaccounting.co.uk • 020 8396 7353

 

Why regular bookkeeping is crucial to your business?

Financial information is what helps you identify whether your business has brought in profits or losses. Without accurate and up-to-date financials, it’s easy to ‘think’ your business is doing well, when in fact it really is in need of some immediate changes to help it stay afloat. Bookkeeping or financial information helps you create an effective budget for your business expenses. It also keeps you prepared for the end of the financial year, when taxes are due, and keeps your business organized.