Budget newsletter

Following a stormy build up to yesterdays budget and the pre-emptive leak by the OBR, we now have the Mount Business Services interpretation of the key facts from the 2025 Budget and how they affect you.

Making Tax Digital for Sole Traders and Landlords

Changes Impacting Financial Reporting

The HMRC App

ANDY’S BACK

Hi everyone, as the title suggests I am back—thank you very much for your well wishes. My recovery has gone as smoothly as I could have hoped for. The team have been fantastic, making sure the work was done in full and to a high quality. Which is how it should be in a high performing organisation.

I am focused on new business and developing our products to benefit all our clients. On that, please welcome our latest clients Wildhut Saunas (www.wildhut.com). Thank you all for your continued support.

The US market has felt like a gold rush for several years now with high consumer spending and high employment fueled by low interest rates.

However the current chaos brought about by the Trump administration and their tariffs has caused a massive shift to what Bill Ackman described as a "self induced economic nuclear winter". https://www.bbc.co.uk/news/articles/c2lzjnj79rdo

What can you do?   Very little, except focus on the short term, focus on the detail and stick to what you do best.

The ONS reported a modest GDP growth of 0.1% in December 2024, offering slight optimism after earlier concerns. The UK’s S&P Global Manufacturing Index shows improvement heading into 2025, though it remains fragile.

A significant challenge is the April increase in employers' national insurance, which is expected to impact industries like hospitality and retail heavily due to mass employment and minimum wage contracts.

Positive changes include adjustments to financial reporting thresholds and the rollout of HMRC's Making Tax Digital for sole traders and landlords, though the increased administration may be burdensome. Xero is well-equipped to meet these new requirements.

Lastly, Xero invoicing is adopting a modernised design - feel free to explore the updates and reach out with any questions.

The Autumn Statement introduces key changes affecting businesses and individuals. Employers’ National Insurance will rise to 15% from April 2025, with increased relief for eligible businesses. Business rates relief for retail, hospitality, and leisure will drop significantly, while minimum wage increases will heavily impact industries like hospitality. From 2027, unused pensions will be subject to inheritance tax, and Capital Gains Tax rates have risen immediately. Planned reforms to child benefits have been reversed, but fiscal drag remains a concern as unchanged thresholds push more taxpayers into higher brackets. These updates highlight both challenges and opportunities for businesses navigating the new fiscal landscape.

Our newsletter has been on hold waiting for the Autumn budget. Ahead of next Wednesday, we wanted to touch base on some non-tax issues.

Important Dates

• 31st January: Self Assessment payment due

• 25th December: Christmas!!!!

• 9 Months after your EOY: Corporation Tax is due for payment

Key things to note in this edition of our newsletter are:

Things do seem to be getting better....at last

Changes to the small and micro company thresholds for business size to determine whether you need an audit

As trading improves beware of overstretching your cash resources, interest rates are still high and a cash flow forecast could save you money and heartache

Use xero to pay your bills directly instead of punching in the data on your banking app

Other watchouts are:

- 31 July is the deadline for your second instalment for income tax year ending April 25.

- P11d deadline is 6th July and payment by 22nd July to avoid a fine.

In times of economic turmoil….

With the 2023/24 Fiscal Year ending on 5 April 2024 and the 2024/25 Fiscal Year beginning on 6 April, there are upcoming deadlines you need to know.

SPRING BUDGET OVERVIEW

Yesterday Chancellor Jeremy Hunt announced the 2024 Spring Budget, which in an environment with apparently little room to manoeuvre sees little change for business owners. Sadly, there’s no reversal of the last corporation tax increases, dividend allowance reduction, or dividend tax rate increases, but there were a few snippets for individuals.