For many years, buy-to-let property has been viewed as a reliable way to secure steady income and achieve long-term wealth growth. However, the landscape has since shifted. While rents across the country continue to rise, changing tax policies and increasing costs have made it harder for landlords to translate high turnover into high profit. Furthermore, the end of fixed-term tenancies and the abolition of 'no-fault evictions' have added layers of complexity to the sector. For both resident and overseas landlords, the most critical variables currently at play are the shifting tax and regulatory environments. Rising Rents – Not Always Rising Returns On the surface, rental income appears robust. In December 2025, the average monthly rent reached £1,368, a 4% increase year-on-year. However, this growth varies significantly by region. For instance, in the year to December 2025, rents in the North East rose by 7.9%, while London saw a more modest increase of 2.1%. Property prices are equally bifurcated. Generally, areas with the highest rents also command the highest purchase prices, which often results in lower rental yields (the ratio of annual rent to property value). Consequently, high rental income does not automatically guarantee a superior return on investment. A Complex Regulatory and Tax Landscape Landlords are facing pressure from two sides. Firstly, the Renters' Rights Act, which came into force last month, has strengthened tenant security. While designed to protect renters, it has caused some anxiety among landlords, leading to concerns about more stringent vetting processes. Secondly, the implementation of Making Tax Digital (MTD) for Income Tax and a series of rate changes are significantly impacting tax liabilities. Mortgage Interest Tax Relief Since April 2020, landlords have been unable to deduct mortgage expenses from their rental income to reduce their tax bill. Instead, the system provides a tax credit equivalent to 20% of mortgage interest payments. This means that while you can no longer reduce your taxable income directly, you can lower your final tax liability through this credit. For example, if a landlord receives £950 in monthly rent (£11,400 annually) and pays £600 in monthly mortgage interest (£7,200 annually), they are taxed on the full £11,400. Under current rules, they receive a tax credit of £1,440 (20% of £7,200). Ultimately, a basic-rate taxpayer would pay £840 in tax, while a higher-rate taxpayer would face a bill of £3,120. This policy was phased in between 2017 and 2020 and has been particularly disadvantageous for higher-rate taxpayers, who previously benefitted from up to 40% relief. New Adjustments from April 2027 From 6 April 2027, the government is set to increase tax rates on property income. The basic rate will rise to 22%, the higher rate to 42%, and the additional rate to 47%. To align with the new basic rate, the mortgage interest tax credit will also increase to 22%. This adjustment means the tax structure is evolving again, forcing landlords to re-evaluate their returns. This has prompted many to consider either selling their portfolios or transferring their assets into a limited company structure to optimise their tax position. Is holding property through a limited company more beneficial? The way a property is held (either personally or through a company) directly impacts tax efficiency. In theory, if a landlord operates through a limited company, they can deduct mortgage interest as a business expense before calculating profit, effectively retaining the advantages of the old system. If held personally, rental profits are treated as personal income and taxed at 20%, 40%, or 45% (rising to 22%, 42%, and 47% in 2027). In contrast, landlords using a limited company pay Corporation Tax, currently ranging from 19% to 25%. This advantage has led to a surge in 'incorporation'; by 2025, there were over 440,000 buy-to-let companies in operation, a nearly fivefold increase since 2016. However, a company structure is not a universal fix and may not suit everyone. Firstly, commercial lending rates for companies are often higher than personal mortgage rates, which can offset tax savings. Secondly, transferring personally owned property into a company triggers Stamp Duty Land Tax (SDLT), which is a significant upfront cost. Furthermore, running a company adds administrative complexity. Landlords must file company accounts and pay Corporation Tax. If you wish to use the rental profit for personal spending, you must extract it as dividends. While dividend tax rates are generally lower than income tax, they have also risen: as of 2026, the ordinary rate is 10.75% and the upper rate is 35.75%. Additionally, the freezing of Income Tax thresholds until 2031 may push more landlords into higher tax brackets. Rising costs of buying and selling Beyond ongoing taxes, transaction costs are climbing. Since October 2024, the Stamp Duty surcharge on additional properties increased from 3% to 5%, raising the barrier to entry. When selling, landlords must also account for Capital Gains Tax (CGT): Basic-rate taxpayers: 18% Higher/Additional-rate taxpayers: 24% The annual exempt amount remains low at £3,000 (£1,500 for trusts). Market volatility can also impact the timing of a sale, potentially restricting liquidity. Consequently, the decision to invest in or retain a buy-to-let property is no longer a simple one. Investors must carefully weigh their tax status, financing options, and risk appetite. The View from TB Accountants The shift in mortgage interest tax policy has fundamentally altered the financial landscape for landlords, particularly those in higher tax brackets. Under the new regime, deciding whether to incorporate, how to structure financing, and how to balance tax vs. operational costs are paramount. Before making any significant changes, it is essential to conduct a full financial assessment and seek professional advice to ensure your investment remains viable in this changing environment. Why TB Accountants? Professional Assurance: Our team includes ACA members and ACCA-certified professionals, delivering services to the highest industry standards. Responsive Service: We respond to your inquiries within 24 hours, ensuring efficient communication across time zones. Multilingual Support: Services available in English, Mandarin, Cantonese, Japanese, French, German, Spanish, Italian, Turkish, and more. Trusted by Clients Worldwide: Consistently praised by global clients for proactive, professional, and reliable accounting and tax support. For individuals and businesses looking for UK taxation services, use our contact form to get in touch for more information. Get in touch with us at info@tbagroup.uk or for a free one-to-one consultation. This article is intended as general guidance only, and does not replace any legal or professional advice. For enquiries, please contact TBA Group via email or WhatsApp.

Two arrested for suspected £153 million TikTok tax scam The UK's tax authority, HM Revenue & Customs (HMRC), has announced the arrest of two men suspected of carrying out a large-scale tax fraud scheme through the social media platform TikTok. Investigators believe the scheme involved using UK taxpayers’ personal tax information to submit fraudulent tax refund claims worth as much as £153 million (approximately RMB 1.4 billion). HMRC cybercrime investigators conducted an operation in East London, successfully blocking suspected fraudulent claims totaling £153 million. On 23 April 2026, two suspects were arrested in the London borough of Newham. According to investigators, the suspects are Romanian nationals aged 22 and 25. Authorities allege that they used TikTok to promote schemes promising “risk-free income” and “easy cash rewards” in order to persuade UK taxpayers to share: HMRC account login credentials; Tax account information; and Personal identification details. The criminals then allegedly used this information to impersonate taxpayers and submit fraudulent tax repayment claims to HMRC for financial gain. Both suspects have since been released on bail while the investigation continues. However, HMRC warned that this type of scam is not limited to TikTok. Investigators have identified similar fraudulent activity on platforms such as Instagram, Snapchat, and other social media networks. Scammers often contact users directly through private messages, claiming they can help secure tax refunds, government grants, or cash rewards. They frequently describe the schemes as “completely legal” and “risk-free” in order to obtain victims’ login credentials and personal information. In reality, because fraudsters conceal their identities, the taxpayer whose details were misused is often the person HMRC initially pursues for repayment when fraudulent claims are discovered. HMRC has reiterated that: It will never use social media to notify individuals about tax refunds; It will never request personal information through TikTok, Instagram, or other social media platforms; and It will never ask for bank account or payment details via social media. Read more... HMRC fuel advisory rates hiked from 1 June 2026 HM Revenue & Customs (HMRC) has announced an increase in its Advisory Fuel Rates (AFR) for company cars effective from 1 June 2026. The guidance rates for petrol and diesel vehicles have risen by as much as 28% compared with the previous quarter, reflecting the impact of persistently high global oil prices on the UK fuel market. At the same time, the separate advisory rates for electric vehicles, introduced earlier this year, remain unchanged. The existing rates for both public and home charging continue to apply. For company cars charged at both residential and public locations, HMRC allows businesses to apportion mileage costs based on the proportion of charging carried out at each location, provided the calculation is considered “fair and reasonable.” According to HMRC, the closure of the Strait of Hormuz has tightened global oil supplies, keeping Brent crude oil prices around $100 per barrel and maintaining pressure on fuel prices across the UK. This marks the first adjustment to petrol and diesel advisory fuel rates in a year and highlights the rising fuel costs facing businesses and drivers. In addition, LPG (liquefied petroleum gas) advisory rates have also increased, returning to the levels previously published by HMRC at the end of last year. Under HMRC rules, the previous rates, which took effect in April 2026, may continue to be used for up to one month after the new rates come into force. When the Rates Apply HMRC emphasized that the advisory fuel rates may only be used in the following circumstances: To reimburse employees for fuel costs incurred during business travel in a company car; or To require employees to repay the cost of fuel used for private journeys in a company car. The rates cannot be used for any other purpose. Businesses that apply the official HMRC rates do not need to seek a separate tax dispensation. HMRC Guidance on Tax Treatment HMRC's latest guidance states that if an employer reimburses employees at or below the advisory fuel rate applicable to the vehicle’s engine size and fuel type, there will be no taxable profit for the employee and no Class 1A National Insurance contributions payable by the employer. However, businesses may choose to apply their own mileage rates if: Their vehicles are more fuel-efficient than average; or The actual cost of business travel exceeds HMRC’s advisory rates. HMRC also notes that if an employer pays a mileage rate above the advisory rate but cannot demonstrate that the actual fuel cost per mile is higher, the excess amount will not trigger a fuel benefit charge. However, the excess reimbursement will be treated as taxable income and subject to Class 1 National Insurance contributions. Quarterly Reviews HMRC reviews and updates advisory fuel rates on a quarterly basis, with assessments conducted on: 1 March 1 June 1 September 1 December Industry observers expect that if tensions in the Middle East continue and international oil prices remain elevated, company car fuel rates in the UK could face further increases in the coming quarters. Read more... Amazon expands grocery products to same-day delivery shoppers E-commerce giant Amazon has announced a major expansion of its online grocery business in the UK at its “Delivering the Future” event in Dartford, Kent. The move will allow selected customers to add fresh groceries to their regular Amazon orders and receive everything through same-day delivery. The service is currently available in parts of London, where customers can order fresh food alongside other products through Amazon's platform and have them delivered on the same day. During the event, Amazon also unveiled a series of investment initiatives covering logistics, employee training, and community support programmes. According to the company, the expanded same-day grocery range includes: Fresh vegetables Beef and other meats Poultry products Seafood Milk and dairy products Bread Eggs Frozen foods These items will be available alongside Amazon’s existing same-day delivery categories, including electronics, household goods, and everyday essentials. Customers can place all items in a single shopping basket rather than making separate orders. The expansion comes after Amazon closed all of its Amazon Fresh physical grocery stores in the UK. Approximately five of those locations have since been converted into Whole Foods Market stores and continue to operate under that brand. Industry analysts believe the move signals a strategic shift, with Amazon focusing more heavily on strengthening its online delivery network rather than expanding its brick-and-mortar retail presence. Amazon’s push into rapid grocery delivery is widely seen as a response to the rapid growth of the UK's rapid delivery market. As consumers increasingly expect faster and more convenient shopping experiences, major retailers are investing heavily to capture a larger share of the online grocery sector. Several established UK supermarket chains have already built a strong presence in this space, including: Tesco, through its rapid delivery service Whoosh Sainsbury’s, through its Chop Chop delivery platform The latest move positions Amazon more directly against traditional supermarket operators as competition intensifies in the fast-growing same-day grocery delivery market. Read more... Why TB Accountants? Professional Assurance: Our team includes ACA members and ACCA-certified professionals, delivering services to the highest industry standards. Responsive Service: We respond to your inquiries within 24 hours, ensuring efficient communication across time zones. Multilingual Support: Services available in English, Mandarin, Cantonese, Japanese, French, German, Spanish, Italian, Turkish, and more. Trusted by Clients Worldwide: Consistently praised by global clients for proactive, professional, and reliable accounting and tax support. For individuals and businesses looking for UK taxation services, use our contact form to get in touch for more information. Get in touch with us at info@tbagroup.uk or for a free one-to-one consultation. This article is intended as general guidance only, and does not replace any legal or professional advice. For enquiries, please contact TBA Group via email or WhatsApp.

Following Chancellor Rachel Reeves's announcement in the 2025 Autumn Budget, a new 'pay-per-mile' tax system is set to be introduced for electric vehicles (EVs) and select plug-in hybrid electric vehicles (PHEVs). From April 2028, pure EV owners will be subject to a road charge of 3 pence per mile, while PHEV drivers will pay 1.5 pence per mile, with this rate increasing annually in line with inflation. The New 'Pay-Per-Mile' Tax System for EVs Under the upcoming regulations, EV owners will pay road charges based directly on their mileage from April 2028. To put this into perspective, a driver covering 8,500 miles a year can expect to pay roughly £255 annually. This equates to about half the fuel duty burden currently borne by traditional petrol or diesel car owners. The government argues this is a necessary step towards a 'fairer' taxation system. Because EVs do not consume petrol or diesel, the current fuel duty framework misses this growing segment of motorists, creating a tax revenue shortfall that this new levy aims to bridge. Importantly, this tax applies exclusively to EVs registered in the UK, regardless of where they are driven abroad. Conversely, foreign-registered EVs driving on UK roads will remain exempt from this specific charge. How Will the Charges Be Enforced? The 'pay-per-mile' charge will be integrated into the existing Vehicle Excise Duty (VED) framework, centrally managed and collected by the Driver and Vehicle Licensing Agency (DVLA). Mileage will generally be verified once a year during the mandatory MOT test, while new vehicles may undergo a mileage check on the first anniversary of their registration. Naturally, this system relies heavily on odometer readings, raising concerns about potential tampering or 'clocking'. Regulatory bodies are already aware that this new tax could incentivise such illicit practices and are actively exploring preventative measures. It is worth noting that these charging standards are currently still in the policy planning phase. The government is holding public consultations, meaning the specific implementation details have yet to be finalised and remain subject to official legislation. The Gradual Increase in Electric Vehicle Tax Burdens The reality is that the 'tax-free' honeymoon period for EVs is steadily drawing to a close. While early adopters enjoyed significant tax incentives, the overall running costs for EVs will slowly align with those of internal combustion engine vehicles over the coming years. Since April 2025, the UK has scrapped the VED exemption for EVs, requiring owners to pay road tax just like traditional motorists. Once the mileage tax comes into force, EV drivers will be hit with both charges simultaneously, further adding to their running costs. Here is a breakdown of the increasing burdens: Vehicle Excise Duty (VED): As of April 2025, EVs fall under the standard VED system. Owners pay £10 for the first year, which then rises to £195 annually from year two. Expensive Car Supplement: For premium EVs (the threshold for which rose to £50,000 in April 2026), owners face an additional annual surcharge of £440. Congestion Charge: As of 2026, EVs are no longer exempt from the London Congestion Charge. Meanwhile, drivers of petrol and diesel cars are experiencing a temporary reprieve. The government has extended the 5 pence per litre fuel duty cut until September 2026, after which it will gradually be reinstated and tied to inflation. Will the New Tax Affect the Appeal of Electric Vehicles? The UK's EV market has seen rapid growth, with pure EVs now making up around 23% of new car sales, meaning one in four new cars sold is electric. However, corporate fleets and businesses account for roughly 75% of these purchases, largely driven by corporate tax reliefs and 'salary sacrifice' schemes. Genuine private buyers make up only about 25% of the market. As the new tax system rolls out and the lifetime running costs of EVs increase, industry experts are concerned this could dampen consumer enthusiasm. So, what are the true costs of buying and running an EV today? Purchase costs The UK government still offers a plug-in car grant, providing up to £3,750 for models priced under £37,000, and related financial support is continuously evolving. Despite this, the high upfront price of EVs remains a significant barrier for many consumers looking to make the switch. Running costs Day-to-day, EVs are generally more cost-effective, particularly for those who can charge at home. Domestic electricity benefits from a reduced VAT rate of 5%, keeping charging costs relatively low. However, relying on public charging networks incurs a 20% VAT rate, with prices varying wildly. In some cases, using 'ultra-rapid' public chargers can even prove more expensive than filling up a petrol or diesel car. Maintenance costs EVs have fewer moving parts than traditional vehicles, making routine maintenance notably cheaper, which remains one of their major selling points. Despite these benefits, public charging infrastructure remains a sticking point for hesitant drivers. While the UK network is growing (currently boasting around 87,000 public charge points), distribution is heavily skewed. Nearly 43% of these points are clustered in London and the South East, leaving other regions and key motorway routes underserved. To address this, the government is injecting a further £200 million to accelerate the rollout of charging infrastructure, with a target of reaching 300,000 charge points by 2030. The View from TB Accountants Overall, the UK's approach to electric vehicles is shifting from early-stage strong incentives towards a stronger regulatory approach. While the government continues to encourage EV adoption through infrastructure investments and purchase grants, it is simultaneously using taxation and charging mechanisms to plug revenue gaps and fund the transport network. As comprehensive tax exemptions become a thing of the past, high-mileage EV drivers will inevitably shoulder a heavier financial burden. Why TB Accountants? Professional Assurance: Our team includes ACA members and ACCA-certified professionals, delivering services to the highest industry standards. Responsive Service: We respond to your inquiries within 24 hours, ensuring efficient communication across time zones. Multilingual Support: Services available in English, Mandarin, Cantonese, Japanese, French, German, Spanish, Italian, Turkish, and more. Trusted by Clients Worldwide: Consistently praised by global clients for proactive, professional, and reliable accounting and tax support. For individuals and businesses looking for UK taxation services, use our contact form to get in touch for more information. Get in touch with us at info@tbagroup.uk or for a free one-to-one consultation. This article is intended as general guidance only, and does not replace any legal or professional advice. For enquiries, please contact TBA Group via email or WhatsApp.

Amazon pays £1.3bn in UK business tax Amazon’s payments in corporate taxes, employer National Insurance contributions, and business rates in the UK have risen sharply. According to a recent statement published on Amazon UK’s official website, the company paid £1.3 billion in taxes during fiscal year 2025 (FY25), representing an increase of nearly 30% compared with the previous financial year. Although Amazon has not yet released its latest revenue figures, the company reported annual UK revenues of £14.7 billion for fiscal year 2024 (FY24). The new tax figures, disclosed through Amazon UK’s official blog, indicate a significant increase in the company’s tax burden compared with both the previous year and earlier periods. For example, Amazon paid only £293 million in UK taxes in 2019. Amazon said the £1.3 billion in business taxes covers a range of taxes directly borne through its operations, including corporation tax, National Insurance contributions, business rates, and the Digital Services Tax. In addition, Amazon collected and remitted £5 billion in taxes on behalf of the government, including Value Added Tax (VAT) and Pay As You Earn (PAYE) income tax deductions. This figure represents a 6% increase from £4.7 billion in the previous year. Combining taxes directly paid and those collected on behalf of the government, Amazon said its “total tax contribution” in the UK reached £6.5 billion, up 12% year-on-year from £5.8 billion. Based on Amazon’s comparison of its 2024 tax data with the latest “Total Tax Contribution Survey” conducted by PwC, the company said it now ranks among the top five corporate tax contributors in the UK in terms of taxes borne and collected. In its logistics operations, Amazon stated that minimum starting pay for frontline employees increased by as much as 5.9% in 2025, raising entry-level annual salaries to £29,744. Since 2022, the company’s minimum starting wage has increased by a cumulative 43%. Amazon is also one of the UK’s ten largest private-sector employers, currently employing around 75,000 people across operations, corporate management, and technology research and development roles. Since 2013, Amazon has created more than 6,000 apprenticeship positions in the UK across over 60 training programmes, including approximately 1,000 new places added in 2025 alone. Amazon UK has recently called for compulsory work experience programmes for young people aged 16 and above, arguing that such measures are particularly important at a time when roughly one million young people are unemployed. As a major investor in the UK, Amazon has invested more than £15 billion in the country to date. Its investments include new fulfilment centres, drone delivery trials, film and television production facilities, and a new office campus in Shoreditch, London. Read more... Treasury delays Isa tax rules after Telegraph exposes flaw The UK Treasury has delayed publishing its highly anticipated new tax rules for Individual Savings Accounts (ISAs). The move comes after The Telegraph revealed a simple loophole in the proposed policy that could allow savers to easily avoid the government’s planned tax charges on cash savings. In last year’s Budget, Chancellor Rachel Reeves announced plans to reduce the annual cash ISA tax-free allowance for savers under the age of 65 from £20,000 to £12,000. The allowance for Stocks and Shares ISAs would remain unchanged, but interest earned within cash ISAs would be subject to a 22% tax. The detailed rules for the policy were widely expected to be published soon, but sources familiar with the matter said the announcement has now been delayed. Under the current proposal, savers could potentially avoid the new tax by investing a symbolic 1p in the stock market while placing the remainder of their funds into investment vehicles that mimic the returns of cash savings accounts. The most common example is money market funds, which typically invest in short-term securities and aim to provide relatively low-risk returns similar to those of cash deposits. The government’s ISA reforms are intended to encourage greater public participation in investing and help build what it describes as a “nation of investors.” However, industry experts have warned that new “anti-circumvention” measures designed to close loopholes could ultimately prove counterproductive. Shadow Chancellor Sir Mel Stride criticised the lack of clarity surrounding the proposals, warning that delays and uncertainty risk “leaving people in the dark.” Financial industry figures have also expressed concern that a more complex system would not only create administrative challenges but could also discourage people from opening ISA accounts, undermining the government’s broader investment goals. Analysts further warned that the proposed changes risk reversing the benefits of the 2014 ISA simplification reforms, which boosted ISA contributions by 45% in their first year. Responding to the criticism, a Treasury spokesperson said: “The vast majority of savers will continue to pay no tax on their savings. The Treasury and HMRC are working at pace with industry to develop the detailed rules and will provide an update on next steps in due course.” Read more... Companies House warning on fake invoices to directors Companies House and the UK Intellectual Property Office (IPO) have jointly issued a warning urging business owners to remain alert to fraudulent payment requests impersonating government agencies. As related scam cases continue to rise, the two organisations have launched an awareness campaign aimed at helping businesses distinguish genuine invoices from fake ones and avoid financial losses. Officials said fraudsters are increasingly posing as Companies House or intellectual property authorities, sending unsolicited payment demands to businesses and attempting to persuade them to pay inflated fees. These fake invoices can often be identified through careful examination of the documents, but businesses are being urged to remain highly cautious of misleading payment requests issued by organisations with no affiliation to the UK government. According to the authorities, fraudulent invoices are commonly sent by post to a company’s registered office address, although they may also arrive by email. Businesses are therefore advised to treat unsolicited paper invoices as a major warning sign, particularly where payment is requested for routine Companies House services or trademark renewals. Companies House noted that such invoices frequently charge significantly more than official government fees, while the services in question can often be obtained legitimately—through Companies House, intellectual property attorneys, or the IPO—at a much lower cost or even free of charge. According to guidance issued by Companies House, fake invoices often share several common characteristics. Fraudsters may request payment for services such as: Opening or accessing a Companies House online account; Completing account authentication or company identity verification; Renewing trademark rights; Or listing trademarks in so-called “exclusive online registers.” To verify whether a payment request is genuine, businesses are advised to carry out the following checks: 1. Check the website and email source Official government services are provided through the UK government website (gov.uk), while scam emails often use generic domains or imitation web addresses. 2. Watch for spelling and language errors Fraudulent emails may imitate government formatting but often contain spelling mistakes, grammatical errors, or unprofessional wording. 3. Look for disclaimers Some misleading organisations include statements noting that they are “not affiliated with government.” Businesses should pay close attention to such disclaimers. 4. Do not click payment links Links contained in emails or letters may be phishing attempts and could contain malware or computer viruses. 5. Contact official bodies directly Before making any payment, businesses should independently contact Companies House or the IPO to verify the legitimacy of the request. Businesses directors and company owners are also reminded to exercise caution when handling any payment requests claiming to come from government bodies and should never make payments without first confirming their authenticity to avoid falling victim to fraud. Read more... Why TB Accountants? Professional Assurance: Our team includes ACA members and ACCA-certified professionals, delivering services to the highest industry standards. Responsive Service: We respond to your inquiries within 24 hours, ensuring efficient communication across time zones. Multilingual Support: Services available in English, Mandarin, Cantonese, Japanese, French, German, Spanish, Italian, Turkish, and more. Trusted by Clients Worldwide: Consistently praised by global clients for proactive, professional, and reliable accounting and tax support. For individuals and businesses looking for UK taxation services, use our contact form to get in touch for more information. Get in touch with us at info@tbagroup.uk or for a free one-to-one consultation. This article is intended as general guidance only, and does not replace any legal or professional advice. For enquiries, please contact TBA Group via email or WhatsApp.

When companies become increasingly globalised, it is common for UK companies to appoint directors who reside outside the UK but perform duties within the country. While this brings valuable professional expertise, it also introduces complex employment tax considerations that are frequently overlooked. Failure to manage these risks effectively can lead to unexpected tax liabilities for both the individual and the company. Why is Tax Payable? Under UK tax law, directors are classified as employees for Income Tax purposes. This means that regardless of whether an individual is a UK tax resident, or whether their primary employer is based outside the UK, any remuneration related to duties performed in the UK -including salary, benefits, and equity incentives - may be subject to UK Income Tax and National Insurance contributions (NICs). A core principle here is 'territoriality': if the relevant duties are performed within the UK, the UK retains the right to tax the corresponding earnings. In practice, HM Revenue and Customs (HMRC) requires remuneration to be split between 'UK duties' and 'non-UK duties' on a 'just and reasonable' basis. In other words, tax is only levied on the portion of income directly attributable to duties performed in the UK. It is particularly important to note that HMRC applies a very strict interpretation to UK duties that are 'merely incidental' (which might otherwise be excluded from UK tax). Activities such as attending board meetings, negotiating contracts, or overseeing UK operations are generally deemed to be substantive UK duties. Consequently, in the absence of applicable tax relief, the remuneration associated with these activities will typically be taxable in the UK. Double Taxation Treaty Relief and the STBV Scheme The good news is that director remuneration may qualify for UK tax relief under the UK's extensive network of Double Taxation Treaties. Eligibility depends on the specific terms of the treaty between the UK and the director's country or territory of tax residence. Generally, UK tax on director remuneration may be relieved if: The director is a tax resident of a country or territory that has a Double Taxation Treaty with the UK; The director is present in the UK for no more than 183 days in any rolling 12-month period; and The remuneration is paid by a non-UK employer and the costs are not borne by a UK entity. Crucially, if the costs associated with the director's UK duties are borne by a UK company, eligibility for treaty relief may be compromised. Even the reimbursement of expenses could potentially disqualify the individual from claiming this relief. Short-Term Business Visitors (STBV) Scheme Where treaty relief is expected to apply, HMRC offers an administrative easement known as the Short-Term Business Visitors (STBV) scheme. This arrangement allows UK companies to bypass Pay As You Earn (PAYE) operations for eligible individuals, provided that information regarding the visitors is reported annually. However, the STBV scheme is not guaranteed to apply to directors. If HMRC determines that the UK company acts as the economic employer of the individual, it may refuse the application of the scheme. National Insurance Contributions Unlike Income Tax, National Insurance contributions (NICs) are determined by whether an individual physically works or is present in the UK, rather than their tax residency status. Furthermore, NICs are not governed by Double Taxation Treaties. Although the UK has social security agreements with certain countries or territories to alleviate or prevent double NICs liability, there are important exceptions. For instance, the UK does not have relevant social security agreements with countries such as Australia or South Africa. This means that directors from these regions may still be liable for UK NICs, even if they qualify for Income Tax relief. Structurally, NICs are divided into employee contributions (primary NICs) and employer contributions (secondary NICs). In most scenarios, the UK company will be regarded as the 'host employer' under NICs regulations, thereby incurring the responsibility for secondary employer contributions. While limited statutory exemptions exist (such as the 52-week rule for seconded workers), these exemptions generally do not apply to directors, as holding a directorship is typically deemed to establish an employment relationship in the UK under domestic tax law. Mitigating Potential Tax Risks If a company intends to appoint a non-UK resident director, or if you are uncertain whether your current setup complies with requirements, the following measures can help mitigate potential tax risks: Assess UK duties at the earliest opportunity Establish a clear understanding of the specific duties the director will perform in the UK and their projected length of stay ahead of time. Even short visits can trigger tax obligations for the UK company. Apportion remuneration reasonably Implement a logical and supportable split of remuneration based on the duties performed inside and outside the UK, allowing for an accurate assessment of potential UK Income Tax and National Insurance (NICs) exposure. Review cost-sharing arrangements Avoid having the UK company bear the director's remuneration or related expenses where possible, as such arrangements can jeopardize eligibility for tax treaty relief. Consider applying for an STBV agreement Where eligibility criteria are met, applying for a Short-Term Business Visitors (STBV) arrangement with HMRC can streamline and simplify compliance processes. Appointing a non-UK tax resident director to a UK company involves more than corporate governance; it is a highly tax-sensitive decision. From Income Tax to National Insurance contributions, and from Double Taxation Treaties to compliance reporting, every stage can impact corporate costs and regulatory risk. Whether you are planning such an appointment or already operate with overseas directors, undertaking a professional evaluation and planning early is essential to minimise potential risks and fully utilize available tax reliefs. Why TB Accountants? Professional Assurance: Our team includes ACA members and ACCA-certified professionals, delivering services to the highest industry standards. Responsive Service: We respond to your inquiries within 24 hours, ensuring efficient communication across time zones. Multilingual Support: Services available in English, Mandarin, Cantonese, Japanese, French, German, Spanish, Italian, Turkish, and more. Trusted by Clients Worldwide: Consistently praised by global clients for proactive, professional, and reliable accounting and tax support. For individuals and businesses looking for UK taxation services, use our contact form to get in touch for more information. Get in touch with us at info@tbagroup.uk or for a free one-to-one consultation. This article is intended as general guidance only, and does not replace any legal or professional advice. For enquiries, please contact TBA Group via email or WhatsApp.

Savers forced to overpay thousands in tax after HMRC errors The UK tax authority (HM Revenue & Customs, HMRC) has recently been accused of incorrectly taxing large numbers of savers due to system errors, with some taxpayers reportedly being charged thousands of pounds in excess tax. An investigation by The Telegraph found that after obtaining bank account data, HMRC miscalculated savings interest tax and automatically adjusted taxpayers’ PAYE tax codes (pay-as-you-earn codes), resulting in reduced take-home pay and unexpected tax bills for many savers. The issue is said to date back to 2016, when then-Chancellor George Osborne introduced new rules requiring banks to report customers’ annual savings interest to HMRC. HMRC then used this data to automatically assess whether taxpayers owed additional tax and adjusted tax codes accordingly to recover the amounts. However, multiple savers have reported serious calculation errors by HMRC, including: Double-counting interest income Incorrectly treating tax-free ISA interest as taxable income Using inaccurate estimated figures Incorrectly linking other people’s accounts to taxpayersSome financial advisers say such cases are becoming increasingly common. In one reported case, a taxpayer had actual savings interest of just £94, but HMRC estimated “untaxed interest” at £3,847, resulting in an overpayment of £1,476 in tax. In another case, HMRC mistakenly taxed hundreds of savers on interest held in ISA accounts, which are supposed to be tax-free. Former Conservative Party leader Sir Iain Duncan Smith criticised HMRC, saying: “HMRC has for too long been a department that operates without proper restraint. Its intrusion into people’s private affairs is excessive, and its failures ultimately leave taxpayers to pay the price.” Under the current UK system: Basic-rate taxpayers have a £1,000 annual tax-free allowance on savings interest Higher-rate taxpayers have a £500 allowance Additional-rate taxpayers have no allowance Since these thresholds have remained unchanged since 2016, rising interest rates have brought more people into the tax net. Data shows that 2.76 million people paid tax on savings interest last year. HMRC said in response that actual savings interest figures for the 2025–26 tax year will be confirmed in November this year. Taxpayers who believe their data is incorrect are encouraged to submit the correct figures in advance for verification. Read more... HMRC tax take hits £87.3bn as fiscal drag drives record PAYE The latest data released by HM Revenue & Customs (HMRC) shows that in April 2026, the UK collected £87.3 billion in tax revenue and National Insurance contributions, an increase of £6.3 billion compared with the same month last year. Among the main components, PAYE income tax and National Insurance contributions rose most significantly to £52.5 billion, while VAT receipts increased to £20.5 billion. Analysts note that this rapid growth in tax revenue is largely driven by “fiscal drag”. As income tax thresholds in the UK have remained frozen since 2016 while wages continue to rise, an increasing number of taxpayers are being pushed into higher tax brackets. As a result, even when real income growth is limited, the overall tax burden continues to increase. Against this backdrop, the structure of the UK taxpayer base is expected to shift further in the coming years, with more middle-income households moving into higher tax bands. Meanwhile, although UK inheritance tax (IHT) receipts in April 2026 fell slightly to £700 million, down £65 million year-on-year, most analysts believe this is only a short-term fluctuation, with the long-term trend still pointing upward. The UK inheritance tax threshold remains frozen at £325,000, unchanged since 2009. Over the same period, UK house prices have risen by more than 75%, meaning more ordinary households are being drawn into the inheritance tax net as property values increase. The Office for Budget Responsibility (OBR) has even projected that the number of estates liable for inheritance tax could nearly double by 2030. Many industry analysts argue that inheritance tax is increasingly functioning as a tax on rising property values rather than a levy targeting the very wealthy. In London and the South East of England, even a typical family home can now exceed the inheritance tax threshold. Data also shows that over the past five years, five London constituencies alone generated more inheritance tax revenue than Scotland and Wales combined. In addition to existing tax pressures, the UK is also advancing several wealth tax-related reforms, including changes to the non-domiciled (non-dom) regime, reforms to business property relief, and plans to bring unused pension pots into the scope of inheritance tax from April 2027. Experts widely believe that these combined changes will significantly increase the long-term tax burden on both high-net-worth individuals and middle-income households. Some market participants have even expressed concern that the UK may further expand wealth taxation in the future, potentially reducing its attractiveness to entrepreneurs and wealthy individuals. Against this backdrop of ongoing policy changes, experts warn that individuals attempting to carry out inheritance tax or wealth planning without professional advice may make costly mistakes, and recommend seeking professional tax and wealth management guidance in advance. Read more... Inflation falls to 2.8% but is expected to rise from here The UK Office for National Statistics (ONS) has released the latest data showing that inflation in April fell more than expected, driven mainly by lower gas and electricity bills. Over the 12 months to April, UK inflation dropped from 3.3% in March to 2.8%. However, many economists believe this decline may only be temporary. With ongoing tensions in the Middle East pushing up global oil prices and energy costs, inflation in the UK is expected to rise again to around 4% by the end of this year. Price pressures may therefore intensify again in the coming months. It is important to note that a fall in the inflation rate does not mean prices are falling overall, but rather that prices are still rising—just at a slower pace than before. Middle East tensions push fuel prices higher Despite the overall slowdown in inflation, geopolitical tensions in the Middle East have driven up international oil prices, leading to continued increases in UK fuel costs, which have reached their highest levels since 2022. ONS data shows that in April, average petrol prices in the UK rose to 156.8 pence per litre, while diesel prices increased by more than 30 pence to an average of 190 pence per litre. The UK’s RAC (Royal Automobile Club) further reported that petrol prices continued to climb in May, reaching a new peak of 158.52 pence per litre last week. KPMG Chief Economist Yael Selfin said the 2.8% inflation reading is “very likely to represent the lowest point for some time.” She expects that inflation will trend upward for most of 2026 and approach 4% by year-end. Inflation outlook and policy response With concerns over further energy price increases, UK Chancellor Rachel Reeves is expected to announce additional measures to support households facing rising living costs linked to Middle East tensions. Meanwhile, the Bank of England remains committed to its 2% inflation target. It typically uses interest rate policy to manage inflation by influencing spending by households and businesses. When inflation is above target, the Bank usually raises interest rates to reduce demand and slow price growth. However, many of the current inflation pressures are driven by external factors—particularly rising global oil prices due to geopolitical instability. As a result, even if interest rates are increased further, their effectiveness in curbing current price rises may be limited. Read more... Why TB Accountants? Professional Assurance: Our team includes ACA members and ACCA-certified professionals, delivering services to the highest industry standards. Responsive Service: We respond to your inquiries within 24 hours, ensuring efficient communication across time zones. Multilingual Support: Services available in English, Mandarin, Cantonese, Japanese, French, German, Spanish, Italian, Turkish, and more. Trusted by Clients Worldwide: Consistently praised by global clients for proactive, professional, and reliable accounting and tax support. For individuals and businesses looking for UK taxation services, use our contact form to get in touch for more information. Get in touch with us at info@tbagroup.uk or for a free one-to-one consultation. This article is intended as general guidance only, and does not replace any legal or professional advice. For enquiries, please contact TBA Group via email or WhatsApp.

Inheritance tax (IHT) is quietly becoming an important source of government revenue growth. What is truly worth noting is that an increasing number of ordinary families who are not usually considered 'wealthy' are being brought into the tax scope. Following the release of the Spring Budget earlier this year, the UK Office for Budget Responsibility (OBR) announced that the forecast for Inheritance Tax receipts over the next five years will be revised upwards by £700 million. During the period from 2025/26 to 2030/31, the Treasury expects to collect £70.6 billion in Inheritance Tax. Meanwhile, a key policy adjustment is approaching – pensions will officially be included within the scope of Inheritance Tax. What kind of chain reaction will this bring? Key changes: pensions to be included in Inheritance Tax According to data published by the OBR, annual Inheritance Tax receipts are expected to grow from this year's £8.7 billion to £14.7 billion in 2030/31. In 2027/28 alone, receipts will increase by £100 million, and thereafter, an additional £200 million will be added each year until 2030/31. There is no doubt that Inheritance Tax is becoming increasingly lucrative as a tax target. One of the core reasons for this is that a major change is about to occur in pension policy – Chancellor of the Exchequer Rachel Reeves announced in the 2024 budget that from April 2027, pension pots will be brought into the Inheritance Tax net. For a long time, pensions have been viewed as a highly efficient wealth transfer tool. This is because they can usually be arranged outside the Inheritance Tax framework to reduce the amount of tax payable. However, following the policy change, many families who originally relied on pensions for asset transfer will see more of their assets fall under the 40% Inheritance Tax rate. This also means that by the end of this decade, the total value of estates will more easily breach the tax-free threshold. This tax is no longer confined to ultra-high-net-worth individuals but is gradually expanding to the middle class. People who originally did not need to pay tax may start receiving tax bills. Double tax burden: middle-class families become taxpayers In addition to the pension policy changes, another driving factor is the long-term freeze on Inheritance Tax thresholds, coupled with continuously rising asset prices. Rising house prices, in particular, are causing the total assets of an increasing number of families to cross the key thresholds. The OBR expects that by 2030/31, there will be over 16,000 estates valued at more than £2 million. In 2022/23, only 3,620 estates liable for Inheritance Tax exceeded this level. More notably, once the total value of an estate exceeds £2 million, the residence nil-rate band will be gradually tapered. This additional £175,000 tax-free allowance will decrease at a rate of '£1 for every £2' above the threshold. For an individual, this allowance will completely disappear when the total estate reaches £2.35 million; for couples, it cannot be used once the estate reaches £2.7 million. This little-known 'tax trap' is causing more families to inadvertently lose the tax-free space they could have enjoyed. A 'triple blow' is forming A slight move in one part affects the whole situation. Bringing pensions into the scope of Inheritance Tax may lead to a 'triple blow': firstly, the pension itself is taxed; secondly, the family residence nil-rate band may be lost; and thirdly, beneficiaries may also face an income tax burden. Here are a few examples to illustrate the effect: If an unmarried person has £20,000 in savings, a £290,000 home, and a £145,000 pension, they might currently not need to pay Inheritance Tax. However, from April 2027 onwards, their tax bill could reach approximately £52,000. If a married couple has a £500,000 home, £100,000 in cash, £200,000 in ISA accounts, and a £400,000 pension, upon the death of the second spouse, they could face an Inheritance Tax burden of approximately £80,000. These figures show that the impact of Inheritance Tax is significantly expanding, and the shock is particularly pronounced for families with a high proportion of pensions in their asset structure. The magnitude of the tax leap is enough to alter the wealth planning arrangements of many families. Tax relief? Finally, let us take a look at the current Inheritance Tax rates and relevant reliefs. Usually, Inheritance Tax is not payable in the following two situations: The total value of the estate is below the £325,000 tax-free threshold; Any part exceeding the £325,000 threshold is left entirely to a spouse, civil partner, charity, or community amateur sports club. If the main residence is left to children (including adopted, foster, or stepchildren) or grandchildren, the tax-free threshold can increase to £500,000. For married individuals or those in a civil partnership, if one party's estate is below their personal tax-free threshold when they pass away, the unused allowance can be transferred to the surviving spouse or partner and used together upon their death. Inheritance tax on the estate exceeding the tax-free threshold will be taxed at the standard rate of 40%. Even if the value of the estate is below the threshold, it may still be necessary to report the total estate value to HM Revenue and Customs (HMRC). Furthermore, some assets gifted during one's lifetime may still be subject to Inheritance Tax after death. For example, if the gifted amount exceeds £325,000 and the donor dies within 7 years, the recipient may need to pay tax. Depending on the timing of the gift, 'taper relief' may apply, reducing the actual tax rate to below 40%. In addition, certain relief policies (such as Business Relief) allow some assets to be exempt from Inheritance Tax or benefit from a lower tax rate. If the estate includes a farm or woodland, you can also enquire about Agricultural Relief policies. It is worth noting that Inheritance Tax is usually paid from the funds of the estate itself, rather than borne personally by the heirs. The person responsible for dealing with the estate (known as the 'executor' if there is a will) needs to pay the tax to HMRC on behalf of the estate. Generally, heirs do not need to pay Inheritance Tax on the inherited assets themselves, but if the inherited assets generate income, such as rental income from an inherited property, they may need to pay corresponding income tax. The view from TB Accountants Bringing pensions into Inheritance Tax from April 2027 will truly change the landscape. Rising asset values and outdated tax thresholds will together create a perfect storm. More families will be caught in the tax net completely unprepared, and many will unwittingly enter it, even if they have never considered themselves 'wealthy'. In the future, Inheritance Tax will no longer be just a 'tax on the rich'. For an increasing number of middle-class families, estate planning will shift from being optional to mandatory. We recommend that you assess your asset situation promptly, including obtaining updated valuations for properties, to understand the potential Inheritance Tax risks you may face. Of course, estate planning itself is quite complex. Professional financial advice can help you structure your assets more efficiently, retaining maximum wealth for your family while remaining legally compliant. Why TB Accountants? Professional Assurance: Our team includes ACA members and ACCA-certified professionals, delivering services to the highest industry standards. Responsive Service: We respond to your inquiries within 24 hours, ensuring efficient communication across time zones. Multilingual Support: Services available in English, Mandarin, Cantonese, Japanese, French, German, Spanish, Italian, Turkish, and more. Trusted by Clients Worldwide: Consistently praised by global clients for proactive, professional, and reliable accounting and tax support. For individuals and businesses looking for UK taxation services, use our contact form to get in touch for more information. Get in touch with us at info@tbagroup.uk or for a free one-to-one consultation. This article is intended as general guidance only, and does not replace any legal or professional advice. For enquiries, please contact TBA Group via email or WhatsApp.

Sir Keir Starmer is facing pressure to resign, and Britain may be entering an era of tax increases Since Labour returned to power in 2024, the UK has gone through multiple rounds of large-scale tax increases. As local elections begin in May, the Labour government is facing an increasingly difficult political situation, and Prime Minister Keir Starmer is under growing pressure. With calls for his resignation rising, financial markets and investors are starting to worry: if there is a shift within Labour, will the UK move toward even higher taxes, greater public spending, and rising government debt in the years ahead? At present, the tax burden on UK workers is already at its highest level since World War II, and it is expected to continue rising in the coming years. Meanwhile, yields on 30-year UK government bonds have climbed to their highest level since 1998, signaling mounting concerns over the country’s fiscal outlook. UK equities have also weakened, reflecting investor fears of potential increases in corporate taxes and business profit levies. Market anxiety is further intensified by the already strained public finances. The UK government’s annual borrowing costs now exceed £100 billion, and rising bond yields mean that future government financing will become significantly more expensive. At the same time, higher yields are also pushing up fixed-rate mortgage costs in the UK. With the Bank of England expected to continue raising interest rates this year, pressure on homeowners could increase further. In fact, since taking office, Labour has already introduced a series of major tax reforms over its first 677 days. These measures have pushed the UK’s overall tax-to-GDP ratio to record highs and triggered significant controversy, including: Removing inheritance tax exemptions for farms valued over £1 million; Introducing VAT on private school fees; Increasing employers’ National Insurance contributions.The rise in employer National Insurance contributions, in particular, is widely believed to have led some companies to freeze hiring plans and cut back on capital investment. Looking ahead, additional tax measures are set to take effect in the coming years: From April 2027, private pensions and death benefits will be included in inheritance tax calculations; The cash ISA tax-free allowance is expected to be reduced in 2027; A “Mansion Tax” targeting properties worth over £2 million is expected to be introduced in 2028. Meanwhile, discussions have already begun in UK politics about who might succeed Starmer. According to betting market data, Manchester Mayor and former Health Secretary Andy Burnham is seen as the frontrunner. He is followed by current Health Secretary Wes Streeting, with former Deputy Prime Minister Angela Rayner in third place. At the same time, markets are also watching potential changes in the Chancellor of the Exchequer position. Pat McFadden, a relatively moderate figure within Labour and currently Secretary of State for Work and Pensions, is widely viewed as a possible future head of the Treasury. Analysts generally believe that any change in leadership would likely be followed by a rapid new fiscal budget. If that happens, long-standing proposals from Labour’s left wing—such as higher public spending, expanded welfare, and new wealth taxes—could play a more prominent role in UK fiscal policy. For a society already facing high inflation, elevated mortgage rates, and a heavy tax burden, fiscal and taxation policy is increasingly becoming a defining issue for the UK’s economic trajectory in the years ahead. Read more... New tourist tax in England outlined in King’s Speech According to the recent King’s Speech, mayors across England are expected to be granted new powers to introduce an “Overnight Visitor Levy.” Under this proposal, tourists staying in hotels, guest houses, B&Bs, or short-term holiday rentals could be required to pay an additional accommodation charge. The bill was first proposed in November 2025 and has since received support from several local leaders, including London Mayor Sadiq Khan and Liverpool City Region Mayor Steve Rotheram. The UK government says the revenue generated from the tourist tax would be used to support local public services and tourism infrastructure projects. It would also bring England into line with Scotland, Wales, and several European countries that already have similar visitor levy systems in place. However, the proposal has divided the tourism industry. UKinbound, the national body representing inbound tourism, argues that international visitors already face some of the highest tax burdens in Europe, including VAT, visa fees, Electronic Travel Authorisation (ETA) charges, and Air Passenger Duty. In this context, the introduction of an additional tourist tax could further weaken the UK’s international competitiveness. The group also stressed that if the policy goes ahead, the key issue will be implementation details—particularly whether the system is simple and transparent, does not add extra costs for businesses, and ensures that revenues are genuinely reinvested into the visitor economy. The government has not yet confirmed the exact charges, which will ultimately be set by local authorities. A formal response to the public consultation is expected soon, along with further details. In fact, similar measures have already been introduced in parts of the UK. Since April 2023, Manchester city centre has applied a £1-per-night “city visitor charge,” which is automatically included unless guests opt out. It is widely seen as a pilot for broader visitor levy schemes. Scotland and Wales already have the legal powers to impose tourist taxes. As England moves toward similar policies, the overall cost of visiting the UK is likely to rise further in the years ahead. Read more... 47% support AI tax as ‘minimum wage for robots’ Recently, British tech entrepreneur Charles Radclyffe proposed the idea of a “minimum wage for robots,” calling for an “AI tax” on companies that use artificial intelligence, in order to slow potential job losses caused by automation. A YouGov poll on the issue found that around 47% of respondents support taxing work performed by AI, compared with just 20% who oppose it. In the survey of 4,200 adults, participants were asked: “Would you support or oppose requiring firms to pay a tax for work done by AI?” Of those surveyed, 23% said they “strongly support” the idea, while 11% said they “strongly oppose” it. However, amid years of constant headlines about automation and AI, there also appears to be a growing sense of public fatigue. The most common response in the survey was actually “don’t know / not sure,” selected by 33% of respondents. The survey also asked participants what impact they expect AI to have on the UK over the next decade. Most respondents believe the biggest changes will occur in the labour market. Many said AI is already reshaping—and will continue to reshape—how work is structured in the UK, with some jobs being automated, shifts in demand across industries, and traditional career paths being redefined. One respondent said: “In the next 10 years, many companies will be heavily reliant on AI. This means workers will have to retrain and pursue new career paths.” Beyond employment, many respondents also expressed concerns about misinformation and a potential trust crisis. They warned that AI-generated fake content, deepfakes, online fraud, and cybersecurity threats could become increasingly widespread. As one respondent put it: “Fraud will increase, privacy will disappear, and trust between people will decline, as it becomes harder and harder to tell what is real and what is not.” Cultural and creative industries were also seen as vulnerable. Some respondents argued that AI could flood the space with low-quality content, crowding out original artistic work. However, others noted that AI could also improve efficiency in areas such as music transcription and design revisions, making certain labour-intensive tasks faster and easier. Ironically, YouGov itself used AI during the survey process. The company said AI agents participated in interviews and followed up on respondents’ answers in order to better understand the reasoning behind public opinions in the UK. Read more... Why TB Accountants? Professional Assurance: Our team includes ACA members and ACCA-certified professionals, delivering services to the highest industry standards. Responsive Service: We respond to your inquiries within 24 hours, ensuring efficient communication across time zones. Multilingual Support: Services available in English, Mandarin, Cantonese, Japanese, French, German, Spanish, Italian, Turkish, and more. Trusted by Clients Worldwide: Consistently praised by global clients for proactive, professional, and reliable accounting and tax support. For individuals and businesses looking for UK taxation services, use our contact form to get in touch for more information. Get in touch with us at info@tbagroup.uk or for a free one-to-one consultation. This article is intended as general guidance only, and does not replace any legal or professional advice. For enquiries, please contact TBA Group via email or WhatsApp.

In recent years, the buy-to-let market has faced ongoing adjustments to its tax and regulatory landscape. Now that we are well into 2026, while there have been no sudden, major tax shocks, the policy direction is abundantly clear: the tax burden will gradually increase, compliance requirements will continue to tighten, and regulatory enforcement will strengthen. For higher-income landlords in particular, an overall increase in tax costs over the coming years is almost certain. Today, we summarise five tax and regulatory changes affecting landlords in 2026, alongside their practical implications and our advice on how to respond. Making Tax Digital (MTD) The rollout of Making Tax Digital for Income Tax Self-Assessment (MTD for ITSA) is well under way, with the first mandatory phase having come into effect last month, in April 2026. Under the new rules, for the 2024-2025 tax year, landlords and sole traders with a total annual income from property or self-employment exceeding £50,000 are now required to use the MTD system for their tax returns. Under this regime, landlords must keep digital records of their income and expenditure and submit quarterly updates to HMRC using compatible software, replacing the traditional annual tax return with an annual final declaration. Although the 2026 mandate does not cover all landlords yet, this year serves as a crucial preparatory phase for full digital reporting. With HMRC stepping up its guidance and pilot programmes, landlords should adapt to the new reporting system as early as possible. Digital record-keeping will very soon become an unavoidable compliance requirement for the vast majority of landlords. New tax rates confirmed for buy-to-let income The government has confirmed that from April 2027, the tax rate on property income, including rent, will rise by two percentage points. This means that even if employment income tax rates remain unchanged, landlords will face a heavier tax burden on their rental profits. It is worth noting that this increase applies solely to property and savings income, whilst wages and other earned income will continue to be taxed at the existing income tax rates. Although the new rates will not officially take effect until 2027, early tax and financial planning is critical now. The impact of this policy will be particularly significant for higher and additional rate taxpayers, as their actual take-home rental profits will be further squeezed, directly affecting their return on investment. Alongside this, the government will also raise the income tax rate applied to savings income by two percentage points across all bands from April 2027. Furthermore, the basic and higher rates applicable to dividend income already increased by two percentage points last month, in April 2026, whilst the additional rate for dividends remains unchanged. The government is also adjusting the income tax calculation rules. The allowances and exemptions deductible in steps two and three of the income tax calculation will now be prioritised against income from other sources. Only after these allowances and exemptions have been exhausted against other income can they be applied to property, savings, and dividend income. Income Tax threshold freeze: a ‘stealth’ tax The Treasury has announced that income tax thresholds will remain frozen for a further three years until the 2031-32 tax year. This policy is often referred to as a 'stealth tax' because, even with nominal tax rates remaining static, rising wages and rents will automatically push more taxpayers into higher tax bands. In reality, income tax thresholds have been frozen since 2022, and this extension merely intensifies the policy's impact. The Autumn Budget in 2024 previously hinted that income tax thresholds might rise with inflation from 2028-29, but this extended freeze represents a clear shift in policy. In practice, a rent increase or a modest rise in profits could easily tip a landlord into a higher tax bracket. When combined with the upcoming hike in property income tax, the compounding effect on your overall tax bill will be highly noticeable. No National Insurance on rental income Ahead of the budget, there was widespread market speculation that the government might impose an 8% surcharge, similar to national insurance, on rental income (which was estimated to raise between £2 billion and £3 billion annually). However, this proposal was ultimately scrapped. Consequently, landlords do not need to pay national insurance on their rental income, offering some short-term relief to market anxieties. Nevertheless, this 'good news' does not equate to a lighter overall tax burden. With property income tax rates set to rise and income tax thresholds remaining firmly frozen, a landlord's total tax bill is still highly likely to increase year on year, even without a new national insurance charge. From a long-term perspective, the upward trajectory of taxes remains unchanged. Changes to dividend tax rates: impacting landlords with limited company structures For landlords who hold property through a limited company, or investors who receive both dividends and rental income, the adjustments to dividend tax policy warrant close attention. The government has confirmed that the two-percentage point increase applied to property income will equally apply to dividend income. This means landlords will pay more tax when extracting profits as dividends. While the additional rate remains steady at 39.35%, the overall tax efficiency will be lower than before. Given that many landlords use limited company structures to achieve greater tax efficiency, the rise in dividend tax will directly reduce post-tax disposable income, while the gap between the tax burden on dividend income and employment income continues to narrow. Under this new policy environment, it is imperative for landlords to reassess whether their current holding structures still offer a tax advantage. Some advice from TB Accountants As we can see so far in 2026, sudden tax shocks are unlikely. However, for buy-to-let landlords, higher taxes on rental income are on the horizon, the threshold freeze will continue to push up effective tax rates, and compliance and reporting requirements are tightening. Concurrently, regulation of the private rented sector is steadily strengthening. Whether you hold property in your personal name or operate through a limited company structure, positioning yourself early for higher taxes and stricter regulations over the coming years is the vital step to navigating this volatile policy landscape. If you have not yet registered for MTD digital reporting, or if you have any questions regarding UK property lettings and investments, we advise seeking professional tax advice from an accountant as soon as possible. Why TB Accountants? Professional Assurance: Our team includes ACA members and ACCA-certified professionals, delivering services to the highest industry standards. Responsive Service: We respond to your inquiries within 24 hours, ensuring efficient communication across time zones. Multilingual Support: Services available in English, Mandarin, Cantonese, Japanese, French, German, Spanish, Italian, Turkish, and more. Trusted by Clients Worldwide: Consistently praised by global clients for proactive, professional, and reliable accounting and tax support. For individuals and businesses looking for UK taxation services, use our contact form to get in touch for more information. Get in touch with us at info@tbagroup.uk or for a free one-to-one consultation. This article is intended as general guidance only, and does not replace any legal or professional advice. For enquiries, please contact TBA Group via email or WhatsApp.

‘Tougher tax backdrop’ drives decline in overseas landlord purchases According to the latest research from UK real estate agency Hamptons, overseas investors are showing declining interest in the UK’s buy-to-let property market as rising stamp duty costs and a tougher tax environment continue to weigh on investment returns. International buyers are increasingly shifting away from investment purchases toward owner-occupier homes. The data shows a significant change in the composition of overseas buyers between 2016 and 2026. In 2016, French buyers accounted for 14% of international purchasers, Spanish buyers made up 10%, and German buyers represented 5%. By 2026, those figures had fallen to 10% for France, 8% for Spain, and just 3.8% for Germany. Hamptons said the slowdown in international demand is mainly driven by “higher stamp duty costs and a more punitive tax environment, particularly for overseas investors.” Currently, an overseas buyer purchasing a £1 million property in England must pay £63,750 in stamp duty. If the property is a second home or intended for rental investment, the tax bill rises sharply to £113,750. Against this backdrop, the purpose of overseas property purchases is changing. Over the past decade, the proportion of international applicants seeking buy-to-let investments has dropped from 17% to 12%. Meanwhile, the share purchasing second homes has fallen even more dramatically, from 6% to just 2%. The report said this reflects “the cumulative impact of higher stamp duty surcharges and increasingly unfavourable tax policies for overseas landlords.” At the same time, first-time buyers are becoming a growing force in the overseas property market. In 2026, first-time buyers accounted for 23% of all international applicants — nearly triple the level seen a decade ago. The shift has been particularly notable among North American buyers. According to the data, 27% of North American applicants are first-time buyers, while only 10% are purchasing for investment purposes. Over the past decade, North American buyers’ share of the UK overseas property market has surged from 8% in 2016 to 19% in 2026, making them the largest overseas buyer group today. Regionally, international demand has declined across every part of the UK except London. Scotland saw a 26% drop in overseas demand, Wales fell 27%, and South West England declined by 20%. In contrast, London bucked the trend with an 8% increase, making it the only region to record growth. Read more... Highest ever tax take at £939bn in single year The latest figures from HM Revenue & Customs (HMRC) show that total UK tax receipts reached a record £938.8 billion in the 2025–2026 financial year, up 9.3% from £858.6 billion the previous year. Over the past two years, tax revenues have risen by a cumulative £110.2 billion, representing a 13.3% increase. The figures mean that under Chancellor Rachel Reeves, Britain’s annual tax take is rapidly approaching the historic £1 trillion mark. Data also shows that the UK’s annual tax burden has nearly doubled over the past 20 years. In the 2006–2007 financial year, total tax receipts stood at £428.6 billion; today, that figure has climbed to £938.8 billion, equivalent to 30.7% of GDP — around two percentage points higher than two decades ago. VAT, Corporation Tax and National Insurance Reach Record Levels In the 2025–2026 financial year, UK VAT receipts hit a record £180.7 billion. At the same time, corporation tax and related business taxes totalled £101.4 billion, which HMRC said was largely driven by growth in domestic corporate tax receipts. The increase in employer National Insurance Contributions (NICs), introduced in April 2025, also caused employer NIC payments to surge significantly. Capital Gains Tax Revenues Jump 62% Figures show that UK Capital Gains Tax (CGT) receipts rose to £22.18 billion in 2025–2026, a sharp 62% increase compared with the previous financial year. Many investors and business owners chose to sell assets early and lock in the existing 20% CGT rate amid fears of future tax hikes, driving a temporary surge in tax revenues. While this provided a major short-term boost to public finances, analysts believe it may also have brought forward future tax receipts. Inheritance Tax Hits Record High for Fifth Consecutive Year Inheritance Tax (IHT) receipts also reached a new record. In the 2025–2026 financial year, UK inheritance tax revenues climbed to £8.46 billion, marking the fifth consecutive annual record high. Although Britain’s tax burden is already at its highest level in 70 years, tax pressures are expected to continue rising in the coming years. Planned measures include: From April 2027, pension assets will fall within the scope of inheritance tax; From 2029, salary sacrifice pension arrangements may face tighter restrictions; The government is also planning to reduce the cash ISA tax-free savings allowance in an effort to channel more money into stocks and shares ISAs. At the same time, the freeze on UK income tax thresholds will remain in place until 2031. This means that even workers receiving inflation-linked pay rises could increasingly be pushed into the 40% higher-rate tax band through so-called “fiscal drag.” Economists warn that the continuously rising tax burden could have long-term consequences for the UK economy and its ability to attract talent. The top 1% of earners currently contribute around 30% of total income tax revenues, and any reduction in this group could shift more of the tax burden onto middle-income households. Tax experts generally believe that, with fiscal drag continuing, pressure on UK taxpayers is unlikely to ease in the near future. Read more... Amazon becomes first UK retailer to begin drone deliveries US e-commerce giant Amazon has become the first retailer to officially launch a local drone delivery service in the UK. The company has begun trial operations near Darlington in County Durham, northeast England, with drones able to serve addresses within a radius of around 7.5 miles (12 km) from its warehouse. The service uses Amazon’s latest MK30 drones, which the company describes as its “most advanced drone system yet.” The drones are already carrying out deliveries in rural areas, transporting packages weighing up to 5 pounds (2.2 kg), including batteries, household cleaning products, cables and beauty items. Under the current delivery model, parcels are placed in boxes and dropped into customers’ gardens from a height of around 12 feet (3.6 metres), meaning fragile items cannot currently be delivered through the system. Amazon said its Prime Air drone delivery service can get products to customers within two hours, and believes there is strong demand for ultra-fast delivery services. The company plans to expand the programme to more parts of the UK in the future. Responding to concerns over noise pollution, Amazon said the MK30 drones are “about as quiet as an average van delivery.” Drone delivery trials are already taking place elsewhere in the UK. The National Health Service (NHS) is testing drones to transport blood samples in London, while Royal Mail has been using drones to deliver parcels to remote islands such as Orkney. However, such services require a number of conditions to be met. For example, customers must have a garden to qualify for drone delivery, while rooftop gardens are currently excluded. The rollout has also faced safety concerns. In February this year, an Amazon delivery drone crashed into an apartment building in Dallas, US, before falling to the ground. Following the incident, the company suspended drone deliveries to certain building types. Amazon stressed that safety remains the top priority for its Prime Air system. The company said that during descent, onboard sensors can detect and avoid obstacles such as clothes lines and trampolines, even if they do not appear on satellite maps. Cameras mounted on the drones also continuously monitor surrounding airspace and can automatically take evasive action if another aircraft enters the drone’s flight path. Read more... Why TB Accountants? Professional Assurance: Our team includes ACA members and ACCA-certified professionals, delivering services to the highest industry standards. Responsive Service: We respond to your inquiries within 24 hours, ensuring efficient communication across time zones. Multilingual Support: Services available in English, Mandarin, Cantonese, Japanese, French, German, Spanish, Italian, Turkish, and more. Trusted by Clients Worldwide: Consistently praised by global clients for proactive, professional, and reliable accounting and tax support. For individuals and businesses looking for UK taxation services, use our contact form to get in touch for more information. Get in touch with us at info@tbagroup.uk or for a free one-to-one consultation. This article is intended as general guidance only, and does not replace any legal or professional advice. For enquiries, please contact TBA Group via email or WhatsApp.

Many people across the UK will find their tax bills quietly creeping up this year. The reason is simple: while inflation nudges incomes upwards, tax thresholds have remained frozen. This means more of us are being ‘pushed’ into higher tax brackets without even realising it – a phenomenon known as fiscal drag. If you are likely to be affected, taking steps to manage your tax burden legally and effectively has never been more important. Here are 5 ways to help you plan smarter in 2026 and keep more of your hard-earned money in your pocket. 5 Ways to Boost Your Take-Home Pay Increase your pension contributions For most, a pension remains one of the most tax-efficient ways to build wealth. Within the current limits (up to 100% of your annual income, generally capped at £60,000), your contributions can immediately benefit from tax relief. Basic rate taxpayers receive 20% relief, higher rate taxpayers get 40%, and additional rate earners can receive up to 45%. Essentially, every pound you put into your pension is ‘discounted’ by the government. Crucially, for those earning over £100,000, putting more into a pension can lower your ‘adjusted net income’. This helps avoid the tapering of the personal allowance (the notorious ‘65% tax trap’), and can help you stay eligible for tax-free childcare. Make the most of your ISAs The Individual Savings Account (ISA) is an incredibly powerful tax-free tool. Each tax year, you can put up to £20,000 into ISA accounts, where all your interest and investment gains are completely tax-free. Moving your savings into an ISA is a straightforward way to protect your returns. Just keep in mind that if you need to sell assets to move the cash, you might still be liable for Capital Gains Tax (CGT) on any profit made during the fiscal year. Note that from 6 April 2027, ISA rules are set for a bit of a shake-up: while the total limit stays at £20,000, Cash ISAs will be capped at £12,000 (unless you’re over 65), with the rest needing to go into other types like Stocks and Shares ISAs. If you’re eligible, don’t forget you can also put up to £4,000 into a Lifetime ISA (LISA). Balance the tax between family members If you are married or in a civil partnership, you can take advantage of a very helpful rule: transferring assets between partners is usually tax-free. This allows you to move assets – such as cash, shares, or other investments – into the name of the partner with the lower tax rate, reducing the overall household tax bill. For example, from 2026, the dividend tax rate for a basic rate taxpayer is 10.75%, whereas an additional rate taxpayer pays a hefty 39.35%. Consider this: If one partner holds an investment portfolio generating £10,000 in annual dividends, transferring it to the partner in the lower bracket could save the household over £2,000 a year. It’s a simple piece of ‘internal’ planning that many people overlook. Report your capital losses promptly When you sell assets like a second home, shares, crypto, or artwork, any profit over the £3,000 annual exemption is subject to Capital Gains Tax (CGT). However, it’s easy to forget that losses have value too. You can use losses from the current year – or even those from up to four years ago – to offset your current gains, bringing your tax bill down. Even if you haven't made a gain this year, it’s still worth reporting any losses to HMRC. They can be ‘carried forward’ to protect your future profits from tax. Don’t forget Gift Aid Donating to charity via Gift Aid is a win-win: it helps the charity, and it can provide you with a tax break. The government adds 25% to your donation, and if you're a higher rate taxpayer, you can claim back even more through your tax return. For every £100 donated, a higher rate taxpayer can effectively receive £25 in tax relief, rising to £31.25 for additional rate earners. Better yet, this relief can be backdated by up to four years. It’s well worth looking back at your recent donations. You might find there’s a bit of tax relief waiting to be claimed. Some advice from TB Accountants Beyond these 5 ways to boost your take-home pay, a few general habits can help keep your finances in top shape. Make sure you’re using all your available allowances, including the Personal Savings Allowance and the Dividend Allowance. You might also want to look at tax-efficient investments, such as UK Gilts (which are CGT-exempt) or certain high-quality bonds. Ultimately, many people pay more tax than they need to simply because the rules are complex. As the tax landscape shifts, staying proactive is the best way to protect your wealth. If you’re unsure which allowances apply to you, or you’d like to get your finances in order before the new tax year kicks off, we’re here to help. Why TB Accountants? Professional Assurance: Our team includes ACA members and ACCA-certified professionals, delivering services to the highest industry standards. Responsive Service: We respond to your inquiries within 24 hours, ensuring efficient communication across time zones. Multilingual Support: Services available in English, Mandarin, Cantonese, Japanese, French, German, Spanish, Italian, Turkish, and more. Trusted by Clients Worldwide: Consistently praised by global clients for proactive, professional, and reliable accounting and tax support. For individuals and businesses looking for UK taxation services, use our contact form to get in touch for more information. Get in touch with us at info@tbagroup.uk or for a free one-to-one consultation. This article is intended as general guidance only, and does not replace any legal or professional advice. For enquiries, please contact TBA Group via email or WhatsApp.

Households urged to make HMRC checks as over 730,000 tax refunds go unclaimed According to the latest data from the UK tax authority HMRC, approximately 730,000 tax refunds went unclaimed last year, with an average value of around £855 per case—bringing the total unclaimed amount to about £624 million. In addition, data shows that in the 2025/26 tax year alone, more than 170,000 people missed out on their tax refunds because they failed to cash cheques issued by HMRC. This means many taxpayers may have overpaid taxes without realizing it, prompting HMRC to urge the public to check their tax status proactively. How tax refunds work According to HMRC guidance, taxpayers who pay through the PAYE system and are due a refund usually receive a tax calculation letter called a P800. This letter clearly states the amount of tax to be refunded. After receiving a P800, taxpayers should carefully check whether their tax code is correct and ensure that all eligible work-related expenses have been included. These may include uniforms, tools, professional fees, and business mileage. However, refunds are not always issued automatically—taxpayers often need to verify the information and submit a claim themselves. If you have not received a P800 but suspect you may have overpaid tax, the simplest way to claim a refund is through the official HMRC app or your online personal tax account. Time limits and repayment methods It is important to note that there is a time limit for claiming tax refunds: in general, claims must be made within four years after the end of the relevant tax year. Refunds can be issued either by bank transfer or cheque. Online claims are usually processed within five working days, while cheque payments may take up to six weeks. How to know if you have overpaid tax Most UK employees pay tax automatically through the PAYE system and do not need to file a tax return. However, overpayments can still occur due to incorrect or outdated tax codes. Common reasons include: Incorrect or outdated tax code Failure to receive full personal tax allowance Not working for the full tax year Changing jobs or working hours during the year For retirees, overpayment may also occur if the tax code incorrectly includes state pension amounts, which can lead to eligibility for a refund. Read more... Rachel Reeves considers war bonds to fund £17.6billion defence spending push According to multiple media reports, UK Chancellor of the Exchequer Rachel Reeves is considering issuing “war bonds” to raise funds for national defence, as part of plans to significantly increase military spending. Sources say the UK Treasury is currently examining the proposal and assessing whether it could help raise around £17.6 billion to support the Labour Party’s pledge to increase defence spending to 3% of GDP by the 2029–2030 fiscal year. Under the proposal, both individual investors and financial institutions would be able to purchase bonds specifically designated for national security spending. UK Defence Secretary John Healey is reportedly supportive of the idea, and it has already been discussed in several recent closed-door meetings. Compared with other funding options—such as cutting welfare spending—“war bonds” are considered to be less politically controversial. Lord Hain, a Labour peer and former cabinet minister, is understood to have raised the proposal with both the Chancellor and Prime Minister Keir Starmer. His suggestion includes creating a dedicated financing mechanism to issue defence bonds within a controlled scale, with funds strictly allocated to military spending. Liberal Democrat leader Ed Davey has also expressed support for the concept. He has previously argued that the UK needs to accelerate defence investment and proposed issuing “war bonds” with a maturity of two to three years and interest rates comparable to standard government bonds. However, Chancellor Reeves has ruled out funding Labour’s defence commitments through tax increases or additional overall borrowing, and has also rejected changes to the pensions “triple lock” policy. In addition, since Labour MPs have previously opposed cuts to welfare spending, Prime Minister Keir Starmer is not expected to pursue that option. Starmer had promised six months ago to publish a 10-year defence investment plan, but it has yet to be released due to ongoing discussions between the Ministry of Defence and the Treasury. Read more... Asos looks to reclaim £7 million in US tariffs UK fast-fashion e-commerce group ASOS has announced that it is seeking to recover approximately £7 million in tariffs previously paid in the United States. These costs were incurred during the first half of the financial year ending March 1. The company has formally initiated a refund or compensation process to reclaim the customs duties paid on goods shipped to the US. This move follows a recent ruling by the US Supreme Court on tariff policy. According to reports, in February the US Supreme Court ruled that former President Donald Trump exceeded his executive authority by imposing certain import tariffs without congressional approval. Four days after the ruling, Trump reimposed a 10% tariff on imports under a different legal provision (Section 122). The court’s decision has also been seen as opening a potential pathway for companies to seek refunds of previously paid tariffs. ASOS said these tariff costs had a significant impact on its first-half profits and caused short-term disruption to its supply chain and fulfilment operations during the initial policy shift. Nevertheless, the company stressed that the United States remains a key strategic market and one of its stronger-performing regions in terms of profitability, with long-term growth potential. To mitigate rising costs, ASOS has implemented several measures, including adjustments to its pricing strategy to maintain competitiveness and support future growth. The company is also managing additional cost pressures linked to geopolitical tensions in the Middle East while continuing to optimise its supply chain and product mix. In terms of financial performance, ASOS reported a reduced pre-tax loss of £137.9 million, compared with £241.5 million in the same period last year. However, total gross merchandise value (GMV) fell by 9% year-on-year to £1.17 billion. The company also noted early signs of recovery. In the UK market, GMV declined by 5%, although new customer numbers increased by around 10%. Sales improved further in the third quarter, contributing to a roughly 4% rise in the company’s share price during intraday trading on Thursday. ASOS stated that it made significant progress in the first half of the 2026 financial year and will continue implementing measures aimed at transforming the company into a leading online fashion platform. Read more... Why TB Accountants? Professional Assurance: Our team includes ACA members and ACCA-certified professionals, delivering services to the highest industry standards. Responsive Service: We respond to your inquiries within 24 hours, ensuring efficient communication across time zones. Multilingual Support: Services available in English, Mandarin, Cantonese, Japanese, French, German, Spanish, Italian, Turkish, and more. Trusted by Clients Worldwide: Consistently praised by global clients for proactive, professional, and reliable accounting and tax support. For individuals and businesses looking for UK taxation services, use our contact form to get in touch for more information. Get in touch with us at info@tbagroup.uk or for a free one-to-one consultation. This article is intended as general guidance only, and does not replace any legal or professional advice. For enquiries, please contact TBA Group via email or WhatsApp.