NEWS

The new tax year brings several updates to payroll and employment costs that employers should be aware of. While many of the changes are relatively small, it’s important to ensure your payroll systems are updated correctly from April 2026. This is a summary of the key updates affecting employers. Statutory Sick Pay (SSP) There are significant changes to Statutory Sick Pay from April 2026 , which are covered in a separate article. Lower Earnings Limit (LEL) The Lower Earnings

From 6 April 2026, new legislation will introduce important changes to Statutory Sick Pay (SSP). Employers will need to ensure payroll systems and processes are updated. What’s Changing? Lower Earnings Limit Removed Currently, only employees earning above a certain threshold qualify for SSP. From April 2026, all employees will be eligible, regardless of income. SSP will be 80% of normal weekly earnings or the weekly flat rate of £123.25, whichever is lower. Waiting Period Rem

It has recently been announced that a number of updates to the UK apprenticeship system are being introduced during 2026, with a stronger focus on supporting younger people into work and helping employers address key skills gaps. Here’s a summary of the main changes and what they could mean for your business: £2,000 Incentive for Hiring Young Apprentices Employers hiring new apprentices aged 16-24 from October 2026 may be eligible for a payment of up to £2,000. This i

A recent tax tribunal decision highlights the importance of keeping proper VAT invoices when reclaiming VAT on business purchases. In the case of Mochars Ltd, the Tribunal considered whether a business could recover input VAT where it was unable to provide the required invoices to support its claim. The Tribunal ultimately dismissed the appeal and confirmed that HMRC was entitled to refuse the VAT repayment. Background to the case The company was VAT registered and submitted

As we approach the end of the 2025/26 tax year, it’s an ideal time for businesses to review employee benefits ahead of the P11D reporting deadline. While these rules apply to all employers, certain sectors, including farming and rural businesses, may face additional considerations, particularly around accommodation and vehicles. Below are the key areas worth reviewing. Accommodation Provided to Employees For businesses that provide living accommodation, job-related accommodat

HM Revenue & Customs (HMRC) has recently highlighted private use adjustments as an area receiving their greater attention during small business compliance checks. HMRC expects these to be carefully reviewed so that only the correct proportion is claimed for tax purposes. What is a Private Use Adjustment? For many small businesses, certain costs naturally have a mixture of personal and business use. A private use adjustment is required so only the portion relating to the busin

A recent tax tribunal case will be of interest to farmers who rear or finish cattle on behalf of other businesses. The case looked at the VAT treatment of arrangements where one farmer houses and feeds cattle owned by another business. The Tribunal decided that the services provided were a single supply that should be charged at the standard rate of VAT. Background to the case A farming partnership entered into an agreement with a company to house and feed cattle. Under the a

From 6 April 2026, the tax cost of leaving a director’s loan account overdrawn is expected to increase. This is because it is linked to the higher rate of dividend tax, which is itself rising. Although final confirmation that this will apply to the Section 455 charge has not yet been issued, it appears likely. The rate is set to increase to 35.75% for loans made on or after that date. The current rate is 33.75% for loans made since 6 April 2022, and 32.5% for loans made befor

After over 20 years with Shepherd Partnership, we said 'farewell' to our Accounts Senior, Michael - who retired at the end of January (thank you, Michael for sticking around till after the tax-return deadline!). Michael began working in accounts and finance straight from college, and joined the Shepherd Partnership team in 2004. He has been a hugely valuable and popular member of the team, and we are sorry to see him go (but happy to see him enjoying a new , relaxed routine)

We closed our office doors for the day last Friday to host a team gathering at Le Bistro in Skipton. After coffee, bacon butties and pastries, we started our day with a team building/information gathering session - which we called a 'team ideas forum'. This was a new idea, and provided an opportunity for everyone to come forward with discussion points/ suggestions for the business going forward/ ways to improve our systems etc... The session was such a success (we would highl

It has been announced that taxpayers who fall into Making Tax Digital for Income Tax (MTD) from 6 April 2026 will face a soft landing for penalty points. Additionally, the government have announced that from 6 April 2027, late submission and late payment penalties for those still in self assessment will mirror the MTD penalty regime. What is the penalty system for MTD? HMRC’s MTD penalty system operates as a point-based system where you will receive separate penalty points fo

From 6 April 2025, if you are a pensioner who received a Winter Fuel Payment, HMRC will recover the amount full if your income was over £35,000. Why will this happen? In July 2024, the government announced that payment of the Winter Fuel Payment was dependent on the individual receiving another means tested benefit. In July 2025, the government expanded the eligibility to include pensioners with total income below or equal to £35,000, in addition to introducing the tax char

As the 2025/2026 tax year draws to a close, it’s an ideal time to review your finances and ensure you’ve taken full advantage of all the allowances and reliefs available to you. Investment Allowances Have you used your £20,000 ISA allowance? Have you used your £3,000 annual exemption for capital gains tax? Have you used your annual £500 dividend allowance? Tax relief on Venture Capital Trusts investments, currently provide 30% tax relief. However, this will be reduced t

Following recent reports from Birmingham Mail, millions of state pensioners are being contacted by HM Revenue & Customs regarding tax on their pension income. Due to frozen income tax thresholds and rising State Pension payments, many retirees who have never previously paid tax may now find themselves liable — sometimes through a “Simple Assessment” letter. If you or a family member has received one of these letters: Don’t ignore it Don’t panic Don’t assume it’s wrong ...But

Following the original announcement in the Spring 2015 Budget, we are now finally 6 weeks away from the introduction of Making Tax Digital for Income Tax (MTD) for sole trader and landlords with combined turnover more than £50,000. Quarterly reporting comes with it! Are you ready? Have you chosen your MTD compatible software? Have you considered the number of licences needed for your individual purposes? Have you signed up for MTD with HMRC? Don’t understand what you nee

In very exciting news from the office, Adam recently became a Grandad for the 1st time! Adam's daughter welcomed her first child - a little boy called Benji! Mother and son are doing well, and are settling into the routine (or perhaps more like thrown into the craziness) of parenthood. Congratulations to the whole family on their adorable new addition. The photos show Adam and his wife, Virginia, enjoying cuddles.

We wondered if The Small Awards might be of interest to some of our clients and contacts... please read on for more info. The Small Awards, delivered by Small Business Britain, are completely free to enter and are an opportunity to get some well-deserved recognition for your small business. With 12 awards up for grabs across a range categories, entries close at midnight on the 28th February and winners will be announced at an exciting awards ceremony. The categories are: Hig

Making Tax Digital for Income Tax comes into force on 6 April 2026, but many sole traders and landlords still don’t know what it means. New research from IPSE, the Association of Independent Professionals and the Self-Employed, shows almost 40% are unaware of the changes. The rules require digital record-keeping and quarterly submissions using HMRC-approved software, with penalties applying for non-compliance. We’re already supporting our clients with MTD setup and ongoing c

On 23 December, the Government confirmed a significant reform to Inheritance Tax (IHT) reliefs for business owners and farmers, increasing the value of assets eligible for full Agricultural Property Relief (APR) and Business Property Relief (BPR) to £2.5 million. The changes will take effect from 6 April 2026. While the increased threshold is welcome, the announcement came too late for some individuals who have already incurred substantial tax planning costs that may now prov

The Department for Environment, Food and Rural Affairs has set out details of the revised Sustainable Farming Incentive (SFI) scheme, which is expected to open in 2026 as part of the next phase of environmental land management support in England. The SFI is a government programme that pays farmers for a range of land management activities designed to support sustainable farming alongside food production. Under the refreshed offer, the scheme will be streamlined with fewer a