Our first thoughts on The Spring Statement 2025

The Chancellor, Rachel Reeves presented her Spring Statement on Wednesday 26 March.

The Chancellor had promised there would be only one major fiscal event each year (the Autumn Budget), with the Spring Statement just acting as an update. As such, no significant tax announcements were expected.

Whilst no new tax rises were announced, there were a number of tax related announcements in the Spring Statement, including:

How the Spring Statement affects Individuals

• High Income Child Benefit Charge (HICBC) - from Summer 2025, employees will be able to pay the HICBC through PAYE, without the need to register for Self Assessment.
• ISAs – a review of reforms to ISAs to get the balance right between cash and equities.
• Making Tax Digital (MTD) – the rollout of MTD for income tax will be expanded to include sole traders and landlords with income over £20,000 from April 2028. Further changes to MTD were set out in a technical note.
  
  

How the Spring Statement affects HMRC

• Third party data – a consultation on how HMRC can make better use of data to increase automation and close the tax gap.
• Tax advisers who facilitate non-compliance – a consultation on proposals to strengthen HMRC’s ability to take action against those tax advisers who facilitate non-compliance from their clients.
• Tax avoidance – a consultation to close in on promoters of marketed tax avoidance. An aim to prosecute more tax fraudsters.
• HMRC’s penalties regime - a consultation on behavioural penalties reform.
• Tax collection - investment in HMRC’s debt management capacity.
• HMRC compliance – recruiting an additional 500 HMRC compliance staff over the next five years.
• Offshore – increased HMRC resource assigned to tackle wealthy offshore non-compliance.
• Informants – a new HMRC reward scheme for informants, with compensation linked to a percentage of any tax recovered.
  
  

How the Spring Statement affects Businesses

• Research & Development (R&D) - new consultations on advance clearances for R&D tax relief claims.
• Tackling ‘phoenixism’ – tackling those using contrived insolvencies to evade tax and write off debts owed to others.
• Customs – aim to simplify the tax and customs systems, with HMRC publishing a transformation roadmap in the summer.
• Entrepreneurs and scale ups – roundtables on fostering a positive, dynamic environment, including the role of tax reliefs such as EMI, EIS and VCT.
  
  

More to come from Shorts

The Shorts Tax team is carefully analysing the Spring Statement, and we will soon be publishing our detailed reaction to the Chancellor’s speech. This will include all major announcements with commentary on what they might mean for our clients. In the meantime, if you have an urgent query or concern following the Spring Statement, please use the form below to contact our tax team, and we will be happy to help.