Business Update – July-August 2025
July 29, 2025
One year into the new government and the challenges don’t appear to be letting up. Faced with lacklustre growth, a jump in inflation and elevated borrowing, the outlook for the next Budget in the autumn is looking less than rosy. While the tensions from President Trump’s ongoing tariff volatility seem to have lessened, the Chancellor’s stated focus on growth faces an uphill climb. With a reversal of the removal of the Winter Fuel Payment for pensioners, including an increased threshold, there are even more complex balancing decisions to be made.
Pensions are very much the focus as the government published its specific plans for taxing unused pension pots from April 2027 in late July. This comes on the heels of the Pension Schemes Bill, which will usher in the biggest reforms since auto-enrolment and pensions freedom. Aimed at achieving higher returns for savers and greater investment in the economy, the provisions will see a consolidation of provision, with multi-employer master trusts focusing investment expertise and efficiency. In this edition of our newsletter, our feature explores how the value for money framework will work and the focus on ensuring pension benefits deliver. With a five-year roadmap to implementation, the Bill is just phase one of the Pensions Review. Phase Two will look at the adequacy of pension provision and inequalities within the system.
Alongside the feature, other stories we explore in this edition include:
Start-ups seed funding grows – The amount companies have raised under the high risk seed enterprise investment scheme or SEIS rose by over 50% in the last tax year, benefiting both companies and investors who can manage the risk.
Navigating VAT issues – VAT complications continue to catch out the unwary. Businesses need to be aware that even though they are not engaged in VAT fraud themselves, they can still suffer for fraud committed through the supply chain if reasonable checks are not carried out. There are also new rules around virtual services.
Dividends data change for directors – From 2025/26, directors of close companies will have to split out the amounts of dividend income they receive from their companies on their self assessment tax returns.
We also cover the return of the Winter Fuel Payment and how it will work, the later arrival of tax freedom day, a new high for late payment interest and more.
Our next newsletter will be out in the October when we will be in touch in anticipation of the autumn Budget. Meanwhile please do contact us if we can continue to help or provide you with more information on any of the topics covered here.