One of the main advantages of setting up a limited company in the UK is that shareholders can receive income through dividends. Compared with salary, dividends are taxed at lower rates, which can reduce overall personal tax liabilities. For example, in the 2024/25 tax year, each shareholder benefits from a £500 dividend allowance. Beyond this, dividend income is taxed according to the individual’s income tax band, at 8.75%, 33.75% or 39.35%. This means that once income exceeds the personal allowance (£12,570) but remains within the basic rate band, dividends are the most tax-efficient option. Salary above the allowance is taxed at 20%, while dividends are taxed at only 8.75%. Even at the higher rate, dividends are taxed at 33.75% compared to 40% on salary.   More ordinary investors now paying dividend tax With the start of the 2025/26 tax year, the dividend allowance has been reduced again, bringing many investors into the scope of dividend taxation for the first time. According to the latest figures, an estimated 3.7 million people will pay dividend tax in 2024/25, compared with 1.9 million in 2022/23. For the first time, basic rate taxpayers now account for the majority of those affected. This marks a significant shift, drawing more ordinary investors and middle-income households into dividend taxation.. Should company directors take salary or dividends? For company directors and owners, the shrinking allowance raises the familiar question: salary or dividends? The personal allowance is £12,570, but salary beyond that is taxed at higher rates. Dividends have only a £500 allowance, yet are still taxed at lower rates. Many directors adopt a mixed approach of ‘reasonable salary plus dividends’ to minimise their overall tax burden. A common strategy is: Set salary within the personal allowance (£12,570) to preserve National Insurance contribution records. Withdraw remaining profits as dividends, which are taxed at lower rates and avoid National Insurance. Example Suppose a company has profits and the director wishes to extract £20,000 as personal income. Option 1: salary only Salary: £20,000 Taxable amount: £20,000 – £12,570 = £7,430 Income tax: £7,430 × 20% = £1,486 National Insurance: approx. £289 Total tax: ~£1,775 Option 2: salary + dividends Salary: £12,570 (tax-free) Dividends: £7,430 Dividend allowance: £500 → taxable dividends: £6,930 Dividend tax: £6,930 × 8.75% = £606 No National Insurance Total tax: ~£606 This shows savings of around £1,169 compared with salary-only extraction, plus no National Insurance liability.   Dividend tax also affects non-directors Dividend tax is not only a concern for company directors. If you invest in shares or funds that distribute dividends, you may also be affected. Holding shares directly If you hold shares directly, all dividends you receive – whether reinvested or taken as cash – are treated as taxable income. With only a £500 allowance, any dividends above this threshold are taxed at the following rates: Basic rate: 8.75% Higher rate: 33.75% Additional rate: 39.35% For example, if you receive £1,500 in dividends in a tax year, £500 is tax-free. The remaining £1,000 is taxed at 8.75%, resulting in a £87.50 tax bill..   Tax-efficient accounts Dividends received within an Individual Savings Account (ISA) or pension (such as a SIPP) are completely tax-free and do not need to be reported to HMRC. This is one of the most effective tax planning strategies for UK investors. Note, however, that the ISA subscription limit for 2025/26 remains £20,000. For investments held outside ISAs and pensions, such as funds, dividend tax may still apply. Funds are usually categorised as ‘accumulation’ (Acc) or ‘income’ (Inc). Income funds: dividends are paid directly into your account and count as taxable income in that tax year. Accumulation funds: dividends are automatically reinvested, but HMRC still treats them as income for tax purposes. Annual tax statements from your investment platform will show the relevant figures.   How to report dividend tax If you receive dividends above the allowance, you must report them to HMRC. The reporting method depends on the total dividend income. Up to £500: no need to report to HMRC. Between £500 and £10,000: you do not need to file a Self Assessment return. HMRC can adjust your tax code through PAYE, or you can report the income by calling HMRC. £10,000 or more: you must file a Self Assessment tax return, declaring all dividend income. If you have not previously registered for Self Assessment, you must do so by 5 October following the end of the tax year, with the return and any tax due payable by 31 January. The view from TB Accountants With the dividend allowance shrinking year by year, more investors are finding themselves paying dividend tax.   Effective tax planning and portfolio management are essential to reduce the impact and protect your investment returns.   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 .

UK state pension likely to rise by 4.7% in April According to the latest wage data, the UK State Pension is expected to rise by 4.7% in April 2026, which could mean an annual increase of more than £500 for those receiving the new State Pension.   Under the current “triple lock” policy, the State Pension increases each year by whichever is highest: 2.5%, the inflation rate (forecast at 4% this September), or the average wage growth. Latest data from the Office for National Statistics (ONS) shows that in the three months to July, average wages including bonuses rose by 4.7%. This figure is likely to serve as the basis for the annual pension increase.   If pensions rise by 4.7%: New State Pension (for those reaching pension age after April 2016): expected to increase to £241.05 per week, equal to £12,534.60 per year, up by £561.60. Basic State Pension (for those who reached pension age before April 2016): expected to increase to £184.75 per week, equal to £9,607 per year, up by £431.60. Around 13 million people in the UK receive the State Pension. Former pensions minister and LCP partner Sir Steve Webb noted that by 2027, those relying solely on the new State Pension will for the first time fall into the income tax net. “Currently, nearly three-quarters of pensioners already pay income tax. With the tax-free allowance frozen and pensions continuing to rise, more older people will be drawn into the tax system.”   The State Pension is the second-largest item of government expenditure after healthcare. The “triple lock” was introduced in 2011 by the Conservative–Liberal Democrat coalition to ensure pensions would not fall behind living costs or wages. However, its long-term cost has been a subject of debate.   Chancellor Rachel Reeves has pledged that the Labour government will retain the “triple lock” throughout this parliament. Government forecasts suggest that by the end of the term, the State Pension will rise by about £1,900 annually. For many retirees, the State Pension is just one source of income, supplemented by occupational or private pensions. Meanwhile, ONS data also shows that regular wage growth (excluding bonuses) slowed to 4.8% in the three months to July, the lowest since May 2022. KPMG’s chief economist Yael Selfin expects wage growth to keep falling over the next year, potentially dropping below 4% by year-end due to weak economic activity and higher labour costs for businesses.   The ONS also reported that the UK unemployment rate rose to 4.7% in the three months to July, the highest since May 2020. During the same period, job vacancies fell by 10,000, and payroll employment dropped by 8,000 in August. Read more... Temu’s UK operation doubles revenues and pre-tax profits   Chinese e-commerce platform Temu recorded rapid growth in the UK last year, with both revenue and pre-tax profit almost doubling thanks to its pricing advantage. According to its latest filings, Temu’s UK division generated $63.3 million in 2024, nearly double the $32 million recorded in 2023. Pre-tax profit rose from $2 million to $3.9 million.   Because of its relatively small profit size, Temu’s UK corporate income tax payment in 2024 was $985,000, up from $517,000 in 2023. The company stated that its UK revenue is defined as “service fees,” similar to Amazon UK and Google UK, generated primarily by providing corporate support services to affiliated companies.   Despite its rapid expansion, Temu, along with Chinese fast-fashion platform Shein and US giant Amazon, may face pressure to raise prices. In April, the UK government announced a review of the rule exempting parcels worth less than £135 from customs duties. UK retailers argue this gives Temu and Shein an unfair advantage in cross-border trade.   Similarly, the US abolished its $800 de minimis import exemption on August 29. The EU is also considering scrapping its €150 exemption threshold and may introduce per-parcel handling fees to stem the inflow of cheap goods and fund additional customs checks.   Read More... Reeves plots ‘taxi tax’ as borrowing costs soar   According to industry sources, Chancellor Rachel Reeves is preparing to announce an increase in VAT on taxi journeys in the Autumn Budget, a move expected to raise about £750 million annually for the Treasury.   Activists have dubbed this the “taxi tax,” which is likely to be officially unveiled in the November 26 Budget to help plug a £50 billion hole in public finances. Data shows that between April and August, UK public borrowing exceeded official forecasts by £11.4 billion, the highest outside the pandemic period.   Industry insiders note that imposing a 20% VAT uniformly on all taxi and ride-hailing trips would increase travel costs outside London, hitting suburban residents who rely on taxis the hardest.   Currently, taxi firms outside London do not have to charge VAT on journeys, as most drivers are self-employed contractors with annual incomes below the £90,000 VAT threshold. Ride-hailing platform Uber previously brought a legal challenge over VAT, initially winning a ruling that required other companies to pay. But last year, the Court of Appeal overturned the decision, and in July 2024 the Supreme Court upheld that outcome.   The Treasury has said it is still considering the possibility of a uniform VAT policy. Financial Secretary to the Treasury Dan Tomlinson stated earlier this month: “The government takes this complex issue very seriously and recognises the need for businesses to have policy certainty. We are carefully considering the wide range of views raised in last year’s consultation and will publish a detailed response soon.”   Industry insiders added that they have been informed Reeves plans to announce a 20% VAT rate on taxi rides in the Budget. The Treasury has also repeatedly said that decisions on tax policy are normally announced as part of major fiscal events such as the Budget.   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 .

Last week, the High Court ruled that the Bell Hotel in Epping, England, must stop accommodating asylum seekers, with around 140 residents ordered to leave by 12 September 2025. The case followed charges against an asylum seeker accused of attempting to kiss a 14-year-old girl. The incident sparked local protests and fuelled wider demonstrations across the country against the growing number of asylum seekers entering the UK. Despite a later appeal reversing the decision, the precedent set has since emboldened other communities, where residents have staged further protests outside hotels used for asylum accommodation, demanding action from local councils and even calling for an end to the government’s resettlement programme. The government now faces mounting pressure on changing immigration policy. Asylum applications at record levels Home Office data shows that the UK received 111,000 asylum applications in the year to June 2025 – a 14% increase on the previous year, and higher than the previous peak in 2002. There are currently 71,000 unresolved cases awaiting an initial decision, affecting around 91,000 individuals, including family members. Meanwhile, 32,059 asylum seekers are still being housed in hotels – slightly higher than when Labour came to power, but well below the 2023 Conservative-era peak of 56,000. Despite the decline, government figures released in July showed that hotel accommodation alone cost £2.1 billion. In total, asylum-related spending in the year to March 2025 reached £4.76 billion, covering direct cash support and housing costs. This figure excludes the costs of policing Channel crossings. Who pays for asylum accommodation? Many people ask: where does the money for asylum seekers and refugees actually come from? Is it funded directly by taxpayers’ contributions? General taxation The UK has no dedicated immigration tax system.  Most asylum-related expenditure comes from the central government’s general taxation pool. Income tax, VAT, corporation tax and other revenues are combined into the public spending pot, from which the Home Office budget is allocated through the annual Budget or supplementary budgets. According to the Office for Budget Responsibility (OBR), UK public spending for 2024/25 is expected to reach around £1.28 trillion, with a portion assigned to the asylum system. Higher visa and immigration fees The Home Office also offsets part of its costs through service charges. In the Spring Budget 2025, the government confirmed that visa and passport fees would increase from April 2025 to help cover additional Home Office expenditure. While not ringfenced for asylum costs, this measure highlights how migration-related fees now act as a fiscal buffer. However, asylum seekers do not pay the Immigration Health Surcharge (IHS), so higher fees do not translate into direct cost recovery from refugees themselves.  Effectively, asylum accommodation is paid for by general taxpayers, alongside international students and legal migrants who contribute through elevated visa fees. The wider impact of rising asylum numbers For many UK taxpayers, the growing number of asylum seekers represents not just a financial cost but also added strain on public services and housing. Calls to reform or even halt asylum resettlement are growing louder. Since 2022, responsibility for asylum accommodation has expanded to around 282 local councils, bringing the issue into communities nationwide. This has raised challenges for social cohesion and local policing. In addition, asylum seekers are typically entitled to basic healthcare and education for their children, which places extra pressure on the NHS and local schools. The view from TB Accountants The UK is engaged in a difficult balancing act.  On one hand, it must uphold international refugee conventions and demonstrate a commitment to human rights and humanitarian obligations.  On the other hand, the government is under pressure to tighten border controls and deter illegal migration in response to public opinion and taxpayer concerns. Labour pledged during the election campaign to eliminate the asylum backlog and phase out hotel accommodation by the end of the current parliamentary term in 2029, projecting annual savings of £1 billion.  However, while progress has been made in reducing the backlog, record new application numbers suggest that the financial and social pressures remain as strong as ever. The global refugee crisis is therefore set to be one of the toughest tests of Labour’s ability to govern effectively – and possibly one of the most decisive issues in future UK elections.   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 .

HMRC raises small business ‘phoenixing’ tax loss to £836mn HMRC’s latest annual report shows that tax losses caused by “small business phoenixing” reached £836 million in the 2022–23 financial year, 45% higher than the previous estimate of £570 million. This figure highlights the significant challenges HMRC faces in curbing such practices. “Phoenixing” refers to the practice where a company goes bankrupt or is liquidated, and then a new company is quickly registered to continue the same business, while the tax debts and other liabilities of the old company are written off. Experts point out that not all “business restarts” are illegal. If a company goes bankrupt due to genuine business failure and the entrepreneur tries again, this is allowed under UK law. However, if directors or shareholders deliberately use insolvency to avoid tax and creditors, it constitutes illegal phoenixing, involving fraudulent liquidation or tax evasion. HMRC reported that its total recorded tax losses in 2022–23 amounted to £3.8 billion, with phoenixing accounting for more than one-fifth of the total, compared to the previous estimate of 15%. The National Audit Office (NAO) has also warned that such practices are particularly common among retailers and small businesses. At the same time, tax evasion cost the UK about £5.5 billion during the same period. The Public Accounts Committee has warned that HMRC may be significantly underestimating the true scale of tax evasion. To address phoenixing, Chancellor Rachel Reeves promised in this year’s Spring Budget to launch a joint crackdown with HMRC, Companies House, and the Insolvency Service. Measures include: Requiring certain high-risk businesses to prepay tax; Expanding directors’ joint liability for company tax debts; More frequent use of enforcement measures, including director disqualification; Strengthening information sharing and regulatory cooperation between the three bodies. With fiscal pressures mounting, tackling phoenixing and tax evasion has become a top priority for HMRC and the Treasury. It is foreseeable that the regulatory environment around tax compliance for SMEs will tighten further, raising demands on businesses for financial management, tax planning, and compliance. Read more... 150,000 people join 'Unite the Kingdom' march in London On September 13 (Saturday), a rally titled Unite the Kingdom—organized by activist Tommy Robinson—took place in central London, drawing an estimated 110,000–150,000 participants, according to police, far exceeding expectations. The atmosphere was tense, and the protest ended with at least 25 arrests and multiple police officers injured.   Protesters waved Union Jacks and St George’s flags, chanting slogans. Robinson called it “the largest free speech rally in British history,” claiming “millions” were involved, and aimed his criticism squarely at the Labour government.   The event was livestreamed on social media, with peak simultaneous viewership reaching 2.9 million. Tesla CEO Elon Musk made a surprise video appearance, urging Britain to “dissolve Parliament and call a new election immediately.”   Other speakers included broadcaster Katie Hopkins and actor Laurence Fox, who criticized immigration policies and court rulings allowing asylum seekers to be housed in local communities, calling them a “denial of local rights.”   Meanwhile, around 5,000 people joined an anti-racist counter-protest. The two sides clashed in Whitehall and Trafalgar Square, prompting police to erect emergency barriers to keep them apart.   The Metropolitan Police said officers faced “serious violence” from some protesters, including punching, kicking, and the throwing of bottles and flares. “Such violence is completely unacceptable,” they stressed. At least nine people were arrested for assaulting police, with more arrests expected. Read More... UK economy saw zero growth in July   The Office for National Statistics (ONS) reported that after 0.4% growth in June, the UK economy recorded zero growth in July, in line with forecasts. However, manufacturing saw its sharpest decline in a year.   As monthly data is volatile, attention has shifted to the rolling three-month trend, which showed 0.2% growth in the three months to July.   The Labour government faces growing pressure to deliver on its key priority of economic growth before the Autumn Budget on November 26.   Analysts widely expect Chancellor Rachel Reeves to announce new tax and spending measures in the Budget, including raising some taxes to reduce the deficit, while pledging that by 2029–30, day-to-day government spending will be covered by tax revenues, and that debt-to-GDP will fall before the end of this Parliament.   Yael Selfin, Chief Economist at KPMG UK, noted that the weak start to Q3 suggests activity could slow further in the second half of the year. She warned that the late timing of the Budget may prolong uncertainty for businesses, delaying investment decisions and dampening short-term growth momentum.   In this context, markets are watching the Bank of England’s September 18 interest rate decision. Policymakers face a tough balance between slowing growth and persistent inflation, leaving the monetary policy outlook highly uncertain.   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 .

Since 2019, the UK has been undergoing a ‘workplace revolution’ driven by the rise of the four-day week. Following successful trials, more than 420 companies have now formally adopted the policy while pledging not to cut salaries. According to data from the Office for National Statistics (ONS), around 1.4 million people were working a full four-day week between October and December 2024. With remote and hybrid working now a widespread trend, tax issues for homeworking employees are increasingly in focus. HMRC has recently clarified that anyone incorrectly claiming tax relief for working from home when they are not eligible could face a substantial repayment bill.   Tax relief for remote working Official figures show that more than a quarter of UK adults continue to work from home for at least part of the week. Under UK tax law, employees who cannot perform their role in an office can claim relief for additional household costs such as business phone calls and heating. Basic rate taxpayers can claim a flat allowance of £6 per week, or deduct the actual costs incurred. However, HMRC stresses that choosing to work from home for personal convenience does not qualify. Incorrect claims may result in taxpayers owing HMRC hundreds of pounds. Employees are also advised not to rely on third-party companies advertising quick refunds for homeworking tax relief. When homeworking tax relief applies Tax relief for working from home only applies in the following circumstances: When an employer does not provide office facilities, and the employee is required to work from home. When the nature of the role makes homeworking essential. For example, a basic rate taxpayer claiming the £6 weekly allowance saves £1.20 in tax per week, or around £62.40 per year. Higher-rate and additional-rate taxpayers can save £124.80 and between £135 and £140.40 respectively. Claims must be supported by evidence such as bills and receipts, alongside confirmation that homeworking is mandatory. During the COVID-19 pandemic, over 800,000 employees successfully claimed this allowance as they were required to vacate office premises. While the benefit was modest, it provided valuable relief against higher household costs such as energy and heating. Backdated claims A notable feature of the scheme is that it can be backdated. HMRC allows eligible employees to make retrospective claims for the current tax year and the previous four tax years. For example, if an employee qualified during the 2020/21 and 2021/22 tax years but failed to claim, they may still be able to secure up to £280 in relief, provided sufficient evidence is supplied. Claims must demonstrate that homeworking was mandatory, with detailed household bills and receipts to substantiate costs. HMRC generally adjusts tax codes so that the relief is spread across payslips, although backdated claims may be issued via cheque. It is important to note that applications for 2020/21 tax year costs closed on 5 April 2025. Rules have been significantly tightened since 2022. Different rules for the self-employed Self-employed individuals cannot use HMRC’s flat £6 per week homeworking relief.  Instead, they must claim expenses through the Self Assessment system, proportionate to the business use of their home. Allowable expenses can include rent or mortgage interest, utilities, insurance, and repairs. As with other deductible business expenses, claims must be carefully calculated, fully documented, and justifiable as business-related. Because this process can be complex, self-employed taxpayers are advised to seek guidance from a qualified tax adviser to ensure accurate claims and avoid rejection. Key Self Assessment deadlines for the 2024/25 tax year 5 October 2025: Deadline to register if you are a new taxpayer (e.g. first year self-employed or with untaxed income). 31 October 2025: Deadline to submit paper tax returns. Late submissions incur penalties. 30 December 2025: Deadline for online returns if you wish tax due to be collected automatically via PAYE. 31 January 2026: Critical deadline for online Self Assessment filing and payment of tax due, including any first payment on account. Late filing or payment will result in fines and interest. Some advice from TB Accountants Overall, the UK’s approach to homeworking tax relief has become more restrictive since the pandemic. The relief remains a useful benefit for employees who are genuinely required to work from home, but HMRC is vigilant about preventing misuse. For employees, there are two main routes to apply: HMRC’s online tool or form P87, which is often used when expenses exceed £2,500 or relate to multiple employments. Those who already complete Self Assessment should include the claim within their annual return.  Whether you are an employee or self-employed, the key is to understand whether your circumstances genuinely qualify, retain full documentation, and avoid misleading advertisements. This way, you can claim legitimately and safeguard your tax position.   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 .

UK Deputy Prime Minister Admits to Underpaying Property Tax and Resigns Recently, UK Deputy Prime Minister and Housing Secretary Angela Rayner admitted that she underpaid property tax when purchasing a flat in Hove, a seaside resort town in southern England. Whether this constitutes deliberate tax evasion remains under discussion.   In an interview with Sky News, Angela Rayner said she had proactively contacted tax authorities to declare the additional property tax owed and would pay it as soon as possible. “I was very shocked, because I thought I had never done anything wrong. It now appears that I made a ‘mistake’ based on the advice I received at the time.”   Her admission has embarrassed her own Labour Party, which is currently in government. A year ago, Prime Minister Keir Starmer won one of the largest election victories in modern British history, but recent polls show Labour trailing behind Nigel Farage’s populist Reform UK party.   At last week’s Prime Minister’s Questions, Conservative leader Kemi Badenoch argued that Starmer should sack Rayner. She accused Rayner of deliberately avoiding the higher tax rate on a second home and of giving up her share in a property in her northern England constituency when purchasing a new flat.   On the evening of September 5, Rayner resigned as Deputy Prime Minister after becoming subject to a tax investigation. Starmer subsequently appointed David Lammy as Deputy Prime Minister and Justice Secretary, using the moment to carry out a major cabinet reshuffle.   Home Secretary Yvette Cooper was moved to Foreign Secretary, while Justice Secretary Shabana Mahmood took over her role. Meanwhile, Starmer dismissed Commons Leader Lucy Powell and Scottish Secretary Ian Murray.   Since the general election, Rayner had been known for her outspoken and passionate style. Her extroverted personality was seen as one of Labour’s strongest electoral assets, helping her quickly connect with ordinary voters—perfectly complementing Starmer’s cautious and formal demeanor. Read more... UK Rent Hits Record High, Cheapest Region Revealed According to leading property website Rightmove, the average monthly rent across the UK reached a record £1,577 in August, up 3% compared with the same month last year. Data shows that London remains the most expensive rental market, while the North East is the cheapest.   The site added that although the number of homes available to rent nationwide was up 8% compared with August last year, it was still 27% lower than in August 2019. Tight housing supply is therefore one of the main drivers of rising rents.   Rightmove listed the average monthly rents and annual increases in August:   East Midlands: £1,134, ↑2.3% East of England: £1,599, ↑2.5% London: £2,699, ↑2.0% North East: £918, ↑2.9% North West: £1,278, ↑9.7% Scotland: £1,141, ↑2.4% South East: £1,828, ↑2.4% South West: £1,461, ↑2.1% Wales: £1,107, ↑2.6% West Midlands: £1,196, ↑2.5% Yorkshire & the Humber: £1,051, ↑2.5%   The North West saw the fastest rental growth, with average rents rising nearly 10% year-on-year, while London recorded the slowest growth at 2%.   Rightmove property expert Colleen Babcock said: “Both tenants and landlords are facing challenges.” On one hand, tenants may find limited options as rents reach record highs; on the other, landlords are grappling with increased tax burdens from stamp duty changes, which affect buy-to-let investments.   “It’s vital to keep the market attractive and viable for landlords, so tenants have more choice of comfortable homes. If rising taxes force more landlords out of the sector, it’s ultimately tenants who will suffer in the long run,” she added. Read More... Shein Caught in UK Tax Controversy: Billions in Revenue “Flowing” to Singapore? Fast fashion giant Shein has once again found itself in the spotlight. The UK-based Fair Tax Foundation has accused Shein of shifting the “vast majority” of its UK revenue to its Singapore parent company, thereby significantly reducing the amount of corporate tax payable in Britain.   According to filings at Companies House, Shein UK generated £2 billion in sales last year, but paid just £9.6 million in corporate tax.   Let’s break down the numbers: Shein UK reported profits of £38.2 million. Under the 25% corporation tax rate, around 84% of its sales revenue—some £1.72 billion—was booked as “procurement costs” and transferred to its Singapore-based parent, Roadget Business Pte Ltd. As a result, the taxable profit left in the UK was minimal.   Paul Monaghan, CEO of the Fair Tax Foundation, commented: “This practice is reminiscent of the tax avoidance controversies involving Amazon, Apple, and Microsoft more than a decade ago. It looks like the fast fashion industry is now replicating the ‘low-tax haven’ model.”   Singapore’s corporate tax rate is just 17%, and with special incentives, the effective rate can drop as low as 5%. Data shows that between 2021 and 2023, Shein’s Singapore business had an average effective tax rate of only 9.4%. Furthermore, Shein’s ultimate holding company is incorporated in the Cayman Islands, another jurisdiction widely seen as a tax haven.   Beyond corporate tax, Shein has also been criticized in the UK for exploiting the “low-value consignment relief” rule. Under current UK regulations, overseas retailers can ship goods worth £135 or less directly to consumers without paying customs duties.   In 2024 alone, parcels from China to the UK were worth as much as £3 billion, accounting for 51% of all small parcels. Estimates suggest that without this exemption, Shein would have had to pay up to an additional £200 million in customs duties.   It is worth noting that the US scrapped its “low-value exemption” for Chinese goods in May this year and will end it for all countries later this month. The EU has also announced plans to phase out similar exemptions. UK Chancellor Rachel Reeves has launched a review, which could pave the way for changes in Britain.   In response to the allegations, a Shein spokesperson strongly denied any wrongdoing, saying that all transactions comply with international practices and the “arm’s length principle.” The fast fashion sector, the spokesperson added, inherently operates on a “low-margin, high-volume” model, and Shein pays all taxes legally due in the UK. As for its Cayman Islands registration, the company said this was a “common corporate structure across industries.”   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 .

On 15 June 2025, the UK government officially launched a landmark reform in the real estate sector — the new Energy Performance Certificate (EPC) assessment standard, RdSAP 10, came into effect. As the most significant upgrade to the EPC system in over a decade, this policy shift will have profound implications for property transactions and the rental market, bringing new compliance requirements, investment considerations, and opportunities for landlords, investors, and industry professionals alike.   PART 1 – Key points of the new EPC rules (1) What is an EPC? The EPC (Energy Performance Certificate) has been the key benchmark for measuring building energy efficiency in the UK since it was first introduced in 2007 and extended to all properties in 2008. Ratings run from A to G, providing buyers and tenants with a clear view of running costs and environmental performance — a crucial reference point for decision-making. (2) Why update the EPC assessment standard? With energy costs soaring and public awareness of sustainability growing, EPC ratings have gained prominence. Properties with low EPC ratings tend to lose value and suffer longer vacancy periods (over 30 extra days on average). Updating the EPC standards aims to more accurately reflect energy performance and drive the property market toward greener, more efficient housing. (3) Impact of the new standard on property ratings The rollout of RdSAP 10 will change how properties are rated, providing greater accuracy. Some homes that previously scored well may see their ratings drop due to poor heat retention, while properties with good insulation, efficient heating systems, or smart energy controls may achieve higher scores. PART 2 – What the new EPC rules mean for landlords (1) Compliance requirements & potential fines Currently, the minimum EPC requirement remains at E rating, but policy trends point to a C rating minimum for all rental properties by 2030 (and for all new tenancies starting in 2028). Failure to meet the threshold can result in fines of up to £5,000, along with reputational damage in the rental market. (2) Greater difficulty in renting out properties Tenants are increasingly prioritizing energy efficiency. A low EPC rating means: Higher energy bills for tenants → less appeal. Lower alignment with growing environmental concerns → weaker competitiveness. Vacancies for poorly rated rentals already last 30+ days longer, and under the new rules this challenge will intensify, cutting into landlords’ rental income. (3) Upgrade costs & challenges To comply, landlords may need to invest significantly in retrofits. Common upgrades include: Improving insulation: Adding wall insulation, upgrading doors/windows. Costs: £5,000–£10,000 for full insulation; £2,000–£5,000 for new double glazing. Replacing heating systems: Switching old gas boilers for efficient models or installing air-source heat pumps. Costs: £2,000–£4,000 for new boilers; £10,000–£20,000 for heat pumps. Installing smart energy management systems: Smart meters and thermostats. Costs: £1,000–£3,000. These upgrades also require time, effort, and reliable contractors — adding further pressure on landlords.   PART 3 – Related tax policies (1) Green tax relief incentives The UK government offers tax relief on approved energy efficiency upgrades, allowing landlords to offset some of their costs. (2) Council tax changes From April 2025, local authorities in England and Wales will double council tax on second homes (‘council tax premium’). This aims to reduce the impact of holiday homes on local housing supply. It’s expected to affect 500,000+ households across 200 areas, generating £1 billion+ annually.  Exemptions apply if: The second home is an annex attached to the main residence. Accommodation is employer-provided for work reasons. Planning restrictions prevent permanent residency (e.g., holiday cottages). Properties listed for sale/rent can receive a temporary exemption of up to 12 months. (3) Stamp duty changes From April 2025: First-time buyer relief threshold fell from £425k to £300k. With London’s median house price at £366k, many buyers will pay an extra £10k–£15k in tax. Second home surcharge rose from 3% to 5% (from Oct 2024). Combined with base rates, top tax bands could reach 17% for properties above £1.5m. Impact: higher transaction costs will influence both pricing strategies for sellers and investment decisions for buyers.   PART 4 – Strategies for landlords (1) Check your EPC rating early Use the government’s EPC register ( www.epcregister.com ) to check your property’s current rating, detailed scores, and upgrade recommendations. (2) Make a phased upgrade plan Prioritize low-cost, high-impact improvements first (e.g., energy-efficient lighting, draught-proofing). For major projects (heating systems, insulation), explore government grants or low-interest loans. Always prioritize quality to ensure long-term benefits. (3) Stay alert to tax policy changes Keep receipts to claim green tax relief. Apply for council tax exemptions where possible. Time property sales/purchases strategically around stamp duty changes. (4) Improve property management & competitiveness Maintain your property well, provide good facilities, and respond to tenant needs promptly. Strong management can attract tenants even in a tougher regulatory environment. The view from TB Accountants The new EPC rules and related tax policies bring both challenges and opportunities. By understanding the regulations, investing in upgrades, and planning tax strategies wisely, landlords can improve energy efficiency, boost competitiveness, and secure sustainable returns on their property investments.   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 .

According to HMRC’s latest annual report, a record 46,266 tax penalties were cancelled in the past year. These penalties were originally issued for late filing, but in many cases the taxpayers involved did not actually owe any tax. Automatic late filing penalties can be appealed In the UK, if you miss the filing deadline for Self Assessment or VAT returns, both individuals and businesses are automatically issued with a penalty notice. However, penalties can be appealed if the late submission was not the taxpayer’s fault or if HMRC incorrectly required the person to file a return. There are several reasons why taxpayers may submit late, including: Delays in bank transfers HMRC’s own administrative errors Poor customer service response times In fact, in the first half of the 2024/25 tax year, HMRC failed to answer 35% of phone calls, far below its 85% target. Although service levels have since improved, the problem has not been fully resolved. A significant number of cancelled penalties were issued to individuals who did not actually need to pay tax. Lower-income taxpayers are disproportionately affected. Over the past five years, 600,000 penalties were issued to people whose income was below the Personal Allowance of £12,570. How to appeal a late filing penalty Last year, HMRC issued nine million penalties, up from just over eight million the year before. However, with the introduction of Making Tax Digital (MTD), a new points-based system has been put in place: For Self Assessment, missing the filing deadline results in an automatic £100 fine, with further penalties increasing over time. For VAT, businesses accumulate penalty points for late returns. Once they reach the threshold set for their accounting period, they are fined £200. Yet many taxpayers are unaware that these penalties can be appealed. Analysts note that up to two-thirds of penalty appeals could be successful, but only a small proportion of taxpayers actually appeal each year – meaning many pay unnecessarily. According to HMRC, if you no longer need to file a tax return, you should inform them before the 31 January deadline. If you believe you were wrongly fined, you can appeal within 30 days of the penalty notice being issued. Self Assessment filing requirements You need to file a Self Assessment tax return if you meet any of the following criteria: You earned more than £1,000 from self-employment (excluding the trading allowance). You received income from rental property, investments, capital gains or overseas earnings. Your annual income exceeded £150,000. You need to repay Child Benefit through the High Income Child Benefit Charge, or for other repayment purposes. Although the government has proposed raising the threshold for reporting income from additional jobs from £1,000 to £3,000 – potentially exempting around 300,000 people from filing – this change has not yet taken effect. Until it does, the current £1,000 threshold still applies. Key filing dates and deadlines Your 2024/25 Self Assessment return will cover the period from 6 April 2024 to 5 April 2025. First-time filers must register with HMRC by 5 October 2025. Registration will provide you with a UTR (Unique Taxpayer Reference) and activation code. Paper returns must be submitted by 31 October 2025. Online returns must be submitted by 31 January 2026. Penalties for late filing Missing the deadline triggers an automatic £100 penalty. After three months, an additional £10 per day applies (up to £900). Further penalties and interest can take the total above £200. If you were wrongly required to submit a return, you may appeal within 30 days. HMRC also recommends informing them before 31 January if you no longer need to file, to avoid unnecessary fines. Tax reliefs and allowances you can claim Personal Allowance & tax rates Personal Allowance: £12,570 per tax year Basic rate 20%: £12,571 – £50,270 Higher rate 40%: £50,271 – £125,140 Additional rate 45%: £125,141+ The Personal Allowance reduces once income exceeds £100,000 and disappears completely at £125,140. Trading allowance Up to £1,000 of non-PAYE income per year can be earned tax-free (applies to self-employment or casual income). If total non-PAYE income does not exceed £1,000, there is no need to report or pay tax on it. Work-related expense deductions You may claim either £6 per week for working from home or actual expenses such as phone and electricity bills. Other allowable expenses include professional subscriptions, business travel costs, and equipment necessary for your work. Some advice from TB Accountants Within the UK tax system, Self Assessment is not simply about filing on time. It can determine whether you pay unnecessary tax, reclaim what you are owed, or avoid being unfairly penalised by HMRC. If you are self-employed, considering taking an additional job or work on the side, or are already running a business, managing your Self Assessment correctly is the first step towards avoiding unnecessary fines.     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 .

Number of countries suspending parcel shipments to the US grows to 25 According to the tariff plan previously announced by US President Donald Trump, starting August 29, 2025, the United States will suspend duty-free treatment for imported parcels valued at $800 or less. After this date, all small parcels will be subject to customs duties based on their country of origin: 10% tariff for UK products, 15% tariff for EU products.   However, gifts valued under $100, as well as ordinary letters and greeting cards, will remain duty-free.   Last week, major European postal operators, including Royal Mail, announced that they will suspend parcel deliveries to the United States. The Universal Postal Union (UPU) stated that, as of August 26, the number of countries deciding to halt parcel shipments to the US had increased to 25, due to the impact of this new policy.   To address the changes, Royal Mail launched a new service on August 28—“US Postal Delivered Duties Paid”—which aims to keep postage rates unchanged while applying a £0.50 customs clearance fee per parcel.   This policy is expected to significantly impact global cross-border e-commerce. Last year alone, approximately 1.4 billion small parcels (with a total value exceeding $64 billion) entered the US under this duty-free policy. For sellers relying heavily on low-value exports, the additional tariffs and procedures will undoubtedly increase costs and complexity.   Some companies have expressed concerns over numerous uncertainties, such as who will be responsible for paying the duties, how the payments will be processed, and what additional data will be required.   Meanwhile, the value of small parcels sent from China to the UK without import tax more than doubled in 2024—from £1.3 billion in the 2023-24 fiscal year to approximately £3 billion, accounting for 51% of all small parcels shipped to the UK globally last year.   Currently, the UK exempts import duties on goods valued at £135 or less. However, due to the competitive pricing of e-commerce platforms such as Temu and Shein, the UK government is reviewing its tax regulations to protect domestic retailers from aggressive low-cost competition. Read more... More than £8bn wiped off British banks over Reeves tax raid fears Last week, fears that Chancellor Rachel Reeves may introduce a new tax on banks to fill gaps in public finances caused the market value of major UK banks to drop by over £8 billion, with listed bank shares falling by as much as 2.7%.   NatWest suffered the largest drop, falling 5.9%, which wiped out £2.1 billion in value. Lloyds Bank and Barclays shares fell by 5.3% and 4.3%, respectively. HSBC also saw a decline of 1.3%.   The market reacted to speculation that the Treasury may target commercial banks’ reserves held at the Bank of England by imposing a new tax. According to estimates by the Institute for Public Policy Research (IPPR), this measure could raise around £8 billion annually. Last year, the UK banking sector already contributed nearly £45 billion in taxes.   The UK Finance trade association has warned that banks already pay a corporation tax surcharge and bank levy, and an additional tax could weaken the UK financial sector’s global competitiveness. Lloyds CEO Charlie Nunn also warned that any increase in tax burden would offset previous benefits from lighter regulation.   Former RBS Chairman Sir Philip Hampton was even more direct: “Imposing more taxes on banks will only reduce their capacity to lend and invest, which is economically unwise.”   The UK government has been under significant fiscal pressure this year. Deputy PM Angela Rayner previously suggested raising corporate taxes on banks, which could generate £3–4 billion annually.   Meanwhile, the Reform UK party has proposed scrapping interest payments made by the Bank of England on commercial banks’ reserves, claiming it could save £35 billion, but BoE Governor Andrew Bailey dismissed the proposal, saying it effectively amounts to a bank tax.   Analysts note that, with the Autumn Budget approaching, markets should expect more trial balloons regarding new taxes, and investors will need to adapt to repeated shifts in policy expectations. Read More... Electric cars eligible for £3,750 discount announced The UK Department for Transport has confirmed that, as part of its plan to reduce petrol and diesel car usage, it will roll out a £650 million electric vehicle subsidy program, offering discounts of up to £3,750 on selected EV models.   The subsidy applies to new models priced at £37,000 or less. Additionally, 26 models will qualify for a £1,500 discount. Manufacturers can apply for the subsidy, and the discount will be automatically applied at the point of sale.   Currently, the two models eligible for the £3,750 discount are: Ford Puma Gen-E (priced at £28,495) Ford e-Tourneo Courier (£32,190) In addition, 26 other EV models qualify for the £1,500 subsidy.   Although the UK government has pledged to ban the sale of new petrol and diesel cars from 2030, many drivers still consider high upfront costs the main barrier to EV adoption. There are also widespread concerns about the lack of charging infrastructure. Currently, there are about 1.3 million EVs on UK roads, but only 82,000 public charging stations.   Online automotive marketplace Autotrader stated that this new incentive is expected to trigger the highest level of EV demand in the past three years.   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 .

Against the backdrop of high taxes and rising living costs in the UK, many people choose to build up their wealth through savings interest or investment products. What some may not realise, however, is that while savings capital itself is not taxed, the interest earned on savings is subject to taxation – this is known as the tax on savings interest. In recent years, the tax burden on British savers has grown heavier. According to the latest data, around 300,000 savers will pay tax on their savings for the first time. The main reason behind this surge is the effect of ‘fiscal drag’.   Sharp increase in taxpayers among savers The Nottingham Building Society, using data obtained under the Freedom of Information Act, revealed that in the 2025/26 tax year the number of savers paying tax has risen from 3.06 million in 2020/21 to 3.35 million. This means an additional 300,000 savers will for the first time be liable to pay tax on their savings interest. The key driver of this change is ‘fiscal drag’. Since the government has frozen income tax thresholds, even modest increases in nominal income caused by inflation can push savers into higher tax brackets, requiring them to pay tax on their savings interest. For example, in the 2025/26 tax year: The basic rate threshold is £12,570 The higher rate threshold is £50,270 The additional rate threshold is £125,140 As wages rise, many savers’ nominal incomes now exceed these frozen thresholds, which in turn triggers a liability to tax on their savings interest. How savings interest is taxed Your liability for tax on savings interest depends on your total income in a given tax year (6 April to 5 April the following year) and the allowances you are entitled to. These include: Personal Allowance Starting rate for savings Personal Savings Allowance Personal Allowance In 2024/25 the standard Personal Allowance is £12,570. If your total income (including wages, pensions and savings interest) does not exceed this amount, you will not have to pay tax. However, if your income exceeds £100,000, the allowance is reduced. For every £1 above £100,000, your Personal Allowance is reduced by £1. Starting rate for savings For savers with annual incomes between £17,570 and £50,270, up to £5,000 of savings interest can be tax-free each year. This allowance is calculated after the Personal Allowance (£12,570). The higher your non-savings income, the less of this starting rate you can claim. For every £1 your non-savings income exceeds the Personal Allowance, your £5,000 starting rate is reduced by £1. Example 1 – full benefit of £5,000 allowance: Salary: £12,000 Savings interest: £4,000 Since the salary is below £12,570, it is fully covered by the Personal Allowance. Non-savings income is under £17,570, so the full £5,000 starting rate applies. The £4,000 interest is fully tax-free. Example 2 – partial or no allowance: Salary: £22,000 Savings interest: £4,000 Here, non-savings income exceeds £17,570 by £4,430. The £5,000 starting rate is reduced by £4,430, leaving only £570 tax-free. Therefore, £3,430 of savings interest is taxable. Personal Savings Allowance On top of the starting rate, you may also qualify for a Personal Savings Allowance depending on your tax band: Basic rate taxpayers: £1,000 Higher rate taxpayers: £500 Additional rate taxpayers: £0 This means anyone earning over £125,140 will pay tax on all savings interest. Finally, if your income from savings and investments exceeds £10,000, you must register for Self Assessment and declare it to HMRC.   How to reclaim overpaid tax on savings interest If you discover you have overpaid tax on savings interest, you can reclaim it – but you must apply within four years of the end of the relevant tax year. If you complete a Self-Assessment Tax Return, you can claim through the return itself. Otherwise, you need to complete form R40 and submit it to HMRC. Repayments usually take around six weeks. How to reduce tax on savings To enjoy more tax benefits on savings, consider diversifying your investments. For example, transferring some savings into an Individual Savings Account (ISA). The annual ISA allowance for 2025/26 is £20,000. If you are married and your spouse has a lower income, you might also consider holding savings in their name to take advantage of their Personal Allowance and Personal Savings Allowance. Some advice from TB Accountants It is important to remember that the way tax-free allowances apply to savings interest can vary depending on your individual circumstances.  If you have no employment income and no pension income: Banks or building societies will report your interest to HMRC, who will then inform you if you need to pay tax. If you are employed or receive a pension: HMRC may adjust your tax code so that the correct tax is collected automatically. They do this by estimating the amount of interest you are likely to receive, based on the previous year, and then issuing a tax calculation notice to confirm whether you have underpaid or overpaid. With 16 years of experience in UK personal and corporate taxation, we can provide bespoke tax solutions for your needs.   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 .

Britain’s pension system is under mounting pressure, with millions of retirees already struggling to make ends meet and younger generations at risk of even greater hardship in the future. Recent data from the International Longevity Centre (ILC) and the Pensions Policy Institute paints a stark picture of a nation facing a deepening retirement crisis. 1. Current situation: Poverty in retirement is widespread According to official statistics, around 1.9 million pensioners — approximately 16 per cent of all retirees — live below the poverty line. The UK’s state pension is among the lowest in the OECD, replacing only 35 per cent of average earnings, compared with the OECD average of 50 per cent. The basic state pension currently stands at about £230 per week for those with a full National Insurance record. While this is protected by the ‘triple lock’ mechanism — meaning it rises annually by the highest of inflation, average earnings growth, or 2.5 per cent — the starting amount is so low that many pensioners remain in financial hardship. Certain groups are particularly vulnerable: Women: The average woman’s private pension wealth is only half that of men. Self-employed workers: Just 20 per cent have a private pension, and more than 3 million have no pension savings at all. Ethnic minorities: On average, they have significantly lower retirement savings than the national average. 2. Future outlook: A worsening gap The ILC warns that younger generations will fare even worse. By 2050, the average annual private pension income for new retirees could fall by £800 in today’s money. Nearly half (45 per cent) of working-age adults currently have no pension savings at all. Rising housing costs, high rents, student debt and the ongoing cost-of-living crisis mean many young people struggle to save for retirement, pushing the prospect of a financially secure later life further out of reach. 3. Causes: A web of systemic issues 3.1 Pension system flaws The automatic enrolment threshold of £10,000 annual earnings excludes many low-income and part-time workers. Average annual private pension contributions are just £3,650 — less than half the level needed for a comfortable retirement. 3.2 Cost of living and inflation The average household energy bill has reached £2,800 a year. Pensioners who rent face even higher poverty rates. Real savings interest rates remain negative — at 1.85 per cent compared with inflation at 5.5 per cent — eroding pension wealth. 3.3 Policy and administrative barriers Despite eligibility, 77 per cent of poorer pensioners do not claim Pension Credit or housing benefit. Complex application processes and strict means-testing exclude many who need support.   4. Government response: too slow to match the scale of the problem? The government has pledged to maintain the triple lock and has offered targeted cost-of-living support, but experts say these measures are insufficient. The Pensions Commission has been reconvened to explore reforms such as lowering the auto-enrolment threshold and creating flexible savings accounts for self-employed workers. However, substantial recommendations are not expected until 2027, raising fears that the crisis will deepen in the meantime. 5. Structural challenges The UK faces a generational imbalance: many current retirees own property outright and have more wealth, while younger people are burdened with high housing costs and precarious employment. This imbalance, combined with policy inertia, means the gap in retirement security is likely to widen.   6. Takeaway for younger generations The message is clear: relying solely on the State Pension will not be enough to maintain a decent standard of living in old age. Proactive private saving and investment are essential, especially for self-employed and lower-income workers. Monitoring policy changes and taking advantage of any available schemes could make the difference between comfort and hardship in later life.   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 .

Reeves considering new property tax on houses worth more than £500,000 According to multiple British media reports, UK Chancellor Rachel Reeves is considering a major tax reform: introducing a new tax on owner-occupied residential properties worth over £500,000. If the proposal is approved, the relevant measures could be introduced during the current parliamentary term.   Currently, anyone buying a property worth more than £125,000 must pay Stamp Duty. For first-time buyers, the threshold is £300,000; however, if the property price exceeds £500,000, the first-time buyer relief no longer applies, and they are taxed as regular buyers.   According to the proposal being studied by the Treasury, a “Proportional Property Tax” may be introduced in the future. This would mainly apply to owner-occupied properties sold for over £500,000. The tax would be based on the property’s value and uniformly collected by HMRC (His Majesty’s Revenue and Customs).   Important points to note: This tax would not replace Stamp Duty on second homes; It would be paid by the owner when the property is sold; In the medium to long term, it may gradually replace Stamp Duty and potentially even Council Tax.   The Treasury believes that a nationwide, standardized property tax would provide a more stable source of income than the current Stamp Duty system. It is expected to generate a similar amount of revenue to current Stamp Duty (which brought in £1.16 billion last year). For more on UK property Stamp Duty, click here: Stamp Duty increased! Second homes to pay an extra 5% surcharge — is there a way to save money? Read more... Rail fares in England on path to rise by 5.8% next year on back of inflation data Due to rising food prices and travel costs, the UK's inflation rate rose again in July to a higher-than-expected 3.8%, marking ten consecutive months above the Bank of England’s 2% target. This has intensified concerns that the Bank may delay further interest rate cuts.   According to the Office for National Statistics (ONS), airfares for outbound UK flights jumped 30% month-on-month due to the early start of the summer holidays. In addition, prices for food and non-alcoholic beverages were up 4.9% year-on-year in July.   Moreover, the Retail Price Index (RPI) for July, which influences the increase in next year’s rail fares, was 4.8%, 0.2 percentage points higher than expected. Typically, regulated rail fare increases are calculated by adding one percentage point to the July RPI — meaning rail fares may rise by 5.8% next year.   In March 2024, rail fares were increased by 4.6%, which was also one percentage point above the July 2023 RPI.   Nearly half of England’s rail fares are directly set by the government. Currently, the Department for Transport (DfT) has not confirmed how it will calculate the fare increases for regulated tickets in 2026. Regulated fares account for roughly half of all train journeys.   The Scottish and Welsh governments usually cap their fare increases at similar levels. Regulated fares include most commuter season tickets, off-peak returns on long-distance routes, and flexible urban rail tickets.   If fares do increase by 5.8%, the annual season ticket between Gloucester and Birmingham would rise by £312, to £5,696. The Woking to London annual season ticket would increase from £4,260 to £4,507, significantly impacting commuters.   Meanwhile, the National Institute of Economic and Social Research (NIESR) expects inflation to decline in the second half of the year, eventually falling back to the Bank of England’s 2% target by the end of 2026. The institute said a November interest rate cut remains likely, especially given signs of a weakening economy, such as rising unemployment and fewer job vacancies.   Chancellor Rachel Reeves responded to the latest data, saying: “We have made progress in stabilizing public finances, but more must be done to reduce the cost of living. That’s why we’ve raised the minimum wage, extended the £3 bus fare cap, and expanded access to free school meals to over 500,000 children.” Read More... Record 111,000 UK asylum applications in past year According to newly released data from the UK Home Office, the country received over 111,000 asylum applications in the year ending June 2025 — a record high. This figure represents a 14% increase compared to the previous year and surpasses the previous peak of 103,000 applications in 2002.   Despite the surge in applications, the government has sped up case processing. As of now, there are still 71,000 applications awaiting an initial decision, involving 91,000 individuals. This backlog is roughly half of the peak seen in June 2023 (134,000 cases).   At the same time, government spending on asylum seekers, such as housing and support, has decreased. The annual cost related to asylum in the UK dropped to £4.76 billion, a 12% decrease year-on-year. In particular, hotel accommodation costs fell significantly, from £3 billion the previous year to £2.1 billion.   Nevertheless, 32,059 asylum seekers are still being housed in hotels — slightly more than when Labour came to power, but well below the peak of 56,000 under the Conservative government in September 2023. Earlier protests erupted over refugees being placed in four-star hotels in London’s Canary Wharf, sparking public backlash. For more on this, see: UK taxpayers outraged: Refugees stay in London 4-star hotels while over a million citizens wait for housing.   The Labour government has pledged to clear the asylum application backlog by 2029 and gradually end the use of hotels in favor of government-owned accommodation facilities. However, whether this target can be met depends largely on the rate of deportations for those who are not granted asylum.   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 .