What It Means for You and Your Business
On 26 March 2025, Chancellor Rachel Reeves delivered the UK’s Spring Statement, outlining economic plans to tackle slower growth and rising costs. While big tax changes are expected in the Autumn Budget, several key announcements will affect individuals and businesses right away. If you use an accountant’s services, here’s what you need to know and how you can prepare.
How Individuals Will Be Affected
1. Benefit Changes and the Cost of Living
If you receive benefits such as Universal Credit or Personal Independence Payment (PIP), you might see changes in eligibility and payments. This could affect your budget, so it’s a good time to review your finances. Your accountant can help you explore budgeting strategies or additional support options.
2. Tax and Savings—What’s Coming?
Changes to ISAs and inheritance tax are on the horizon. If you’re saving for the future or managing family wealth, staying ahead of these changes could help you maximise tax-efficient savings. Your accountant can guide you on the best strategies before the Autumn Budget.
3. Job Market Shifts—What It Means for You
With welfare cuts pushing more people into work, there may be more job opportunities. However, wages and government support schemes could change, so it’s essential to plan ahead. Whether you’re self-employed or looking for new employment, an accountant can help you understand tax implications and financial planning.
How Businesses Will Be Affected
1. Changes to Tax Rules—Be Prepared!
Tax adjustments are coming, including updates to inheritance tax and Individual Savings Accounts (ISAs). While details are still emerging, these could impact your investment and financial planning. Also, new late payment penalties on VAT and self-assessed income tax will start from 6 April 2025. If you manage a business, working with your accountant to stay compliant and avoid extra costs is crucial.
2. Opportunities in Digital and Public Sector Work
The government is putting £3.25 billion into modernising public services with digital technology and artificial intelligence. If your business provides tech, AI, or consultancy services, there may be new opportunities to work with the government. Speak to your accountant about potential funding or contracts that might benefit your company.
3. Hiring and Workforce Considerations
A £14 billion reduction in welfare spending means some people will need to find work sooner than expected. This could mean a larger labour pool for businesses, but also a need for extra training and support for new hires. If you’re looking to expand your team, talk to your accountant about any tax incentives or support schemes available.
4. Defence and Industrial Growth—New Business Prospects?
The government wants to boost the UK’s defence and manufacturing sectors, which could mean increased demand for materials like steel and related industries. If your business is in construction, manufacturing, or supply chains, there could be growth opportunities. Your accountant can help you plan ahead for potential changes in demand.
Next Steps: Stay Informed and Plan Ahead
The Spring Statement 2025 highlights key changes that could affect your business and personal finances. Now is the time to speak to your accountant about how to prepare, minimise tax liabilities, and take advantage of opportunities. If you’re unsure how these changes apply to you, getting expert advice can help you navigate the months ahead with confidence.