UK 2025 Spring Budget: Key Business Insights

In the Autumn Budget 2024, as part of a commitment to providing the business community with much needed stability and certainty around taxes, the Chancellor published a Corporate Tax Roadmap setting out the Government’s plans on Corporation Tax.

It is, therefore, unsurprising that the Spring Statement 2025 contained limited announcements in relation to UK Corporation Tax. In an attempt to find ways to continue to provide certainty in existing areas of taxation, simplify areas which are overly complex, and crack down on the loss of tax revenue through tax avoidance schemes, the Government has launched a number of consultations, some of which were earmarked in Autumn 2024.

Key consultations announced include:

• Research and Development tax relief advance clearances: This consultation is aimed at understanding whether a system of advanced clearances would help to increase certainty for customers and improve customer experience. The consultation will run until 26 May 2025.
• Advanced certainty for major projects:This consultation explores how the Government can offer long-term tax certainty for investors in major UK projects. Key aspects include:
  • Initially targeted at investors without an existing UK tax presence
  • A primary focus on UK Corporation Tax, with potential expansion to other tax areas; and
  • Will involve a multi-step process including written clearance

The Government is also considering whether businesses would be willing to pay for such a clearance service. This consultation is open until 17 June 2025.

• Behavioural penalty reform: This consultation comes as a result of previous consultations regarding the tax administration framework. The consultation welcomes feedback on simplifying the UK’s behavioural penalty regime and will run until 18 June 2025
• Enhancing HMRC’s ability to tackle tax advisers facilitating non-compliance: The Government is committed to cracking down on the loss of tax revenue through tax avoidance. This consultation will run until 7 May 2025
• Closing in on promoters of tax avoidance: Again, with a further view tocracking down on the loss of tax revenue through tax avoidance, the Government has opened a consultation regarding the expansion of the disclosure of tax avoidance schemes

From April 2025, several key tax changes will take effect. Here’s a quick look at some of the most significant changes:

• A new residence-based taxation system for foreign income and gains with abolition of remittance basis for foreign domiciled individuals
• The scope of Inheritance Tax will now be determined by long-term residence rather than domicile
• Company car benefits will increase
• Capital Gains Tax (CGT) rate changes affecting:
  • Gains on Business Asset Disposal Relief and Investors’ Relief assets
  • ‘Carried interest’ receipt
• Extension of Agricultural Property Relief to land managed under environmental management agreements
• Significant changes to business rates reliefs
• Changes to Audio-Visual Expenditure Credit (AVEC)
• Higher penalties for late VAT payments
• Furnished Holiday Lettings regime ends
• Stamp Duty Land Tax (SDLT) thresholds lowered
• Interest rate increases on overdue tax and VAT by 1.5 percentage points
• Upcoming ‘payrolling’ of taxable benefits

VANTRU is a regulated UK Trust & Corporate Service Provider and our team specialises in helping foreign businesses establish a presence in the UK; providing essential corporate, compliance and advisory needs including assisting our clients with their Financial Reporting, Accounting and Tax requirements in the UK.

If you have any queries about what these updates will mean for your business, get in touch today.

Email: info@vantru.com or visit: www.vantru.com.