Business Tax
Business rates
During COVID-19, temporary business rates relief was introduced to support the retail, hospitality and leisure (RHL) sectors. This short-term measure was extended several times, but the current 75% relief is due to end on 31 March 2025.
The government plans to bring in permanently lower business rate multipliers from 2026/27 for RHL properties with rateable values under £500,000. For properties over this rateable value a higher multiplier will apply. This will, for example, affect the majority of large distribution warehouses used by online companies.
To provide support in the interim, business rates relief will be extended from April 2025 but reduced to 40% and capped at £110,000 per business. Many high street businesses, pubs, restaurants and shops may see higher business rates as a result.
The small business multiplier will be frozen for 2025/26 at 49.9p, while the standard multiplier will be uprated by inflation to 55.5p.
Private schools
As announced on 29 July, private schools will no longer be eligible for charitable rate relief from April 2025. Private schools which are wholly or mainly concerned with providing full-time education to pupils with an Education, Health and Care Plan will remain eligible for relief.
Umbrella companies
To tackle the significant levels of tax avoidance and fraud in the umbrella company market, the government will make recruitment agencies responsible for accounting for PAYE on payments made to workers that are supplied via umbrella companies. Where there is no agency, this responsibility will fall to the end-client business. This will take effect from 6 April 2026.
Furnished holiday lettings (FHL)
The March 2024 Budget announced that the tax advantaged treatment of FHL will be abolished from 6 April 2025. Anyone who has benefited from this treatment up to now, and who has not yet taken advice about the consequences of the change, should do so as soon as possible.