31/03/25
**Business Impact of the Spring Statement 2025**
Key Updates & How Friendly Assist Accountancy Can Inspire Your Business
Chancellor Rachel Reeves has laid out a clear vision for economic resilience, confirming pivotal updates to tax compliance, HMRC enforcement, and Making Tax Digital (MTD) timelines.
Here’s what small businesses and landlords need to embrace—and how Friendly Assist Accountancy can guide you through these essential changes
MTD for Income Tax: Timelines & Exemptions
Key Deadlines:
- 2026: Self-employed individuals and landlords earning over £50,000.
- 2027: Income over £30,000.
- 2028: Income over £20,000.
With MTD on the horizon, it’s time for businesses to harness its potential. Organizing your tax affairs will lift the burden of HMRC scrutiny, allowing space for your innovative ideas to flourish.
Exemptions do exist. Individuals with Power of Attorney, non-UK entertainers, and those unable to use HMRC’s digital services can find relief from these requirements.
Stricter Late Payment Penalties
As outlined in our March 8th blog post, “Tax Year – Key Deadlines to Consider,” MTD late payment penalties will rise from 2% to 3% for overdue payments between 15 to 30 days starting in April 2025.
An additional annual charge of 10% will emphasize the importance of precise bookkeeping and timely accounting.
Employer NI Changes Proceed as Planned
It’s confirmed: businesses will face increased National Insurance (NI) contributions. As we noted in our previous post, “The Health Sector and NHS Reforms,” the employer NI rate will rise to 15% from 13.8%.
Although the rise in the employment allowance to £10,500 will help ease the burden, readiness is essential.
HMRC Crackdown on Tax Evasion
The addition of 500 compliance staff and an investment of £87 million for debt recovery marks a bold move against tax evasion.
We believe in transparent taxation and clear policies, fostering a fairer system. New incentives for whistleblowers and strict penalties for “phoenix companies” reinforce this commitment.
Simplified Child Benefit Reporting
Starting summer 2025, the High Income Child Benefit Charge (HICBC) will be reported through PAYE rather than Self Assessment, making the process efficient for all involved.
Friendly Assist Accountancy Is Here for You
Navigating tax changes is not merely a challenge; it’s an opportunity to strengthen your business. From MTD readiness to penalty avoidance and payroll support, we stand ready to empower your business.
Our dedicated team ensures seamless MTD compliance, from software setup to quarterly submissions that minimize disruptions to your operations.
We enhance payroll processes and maximize NI savings, enabling you to capitalize on allowances while adapting effortlessly to new rates.
Through our comprehensive compliance audits and risk assessments, we protect your business from HMRC scrutiny and safeguard you against accidental errors.
We simplify PAYE reporting and manage HICBC adjustments, freeing you from administrative burdens.
Additionally, our proactive tax planning and timely payment reminders will help you navigate potential pitfalls, ensuring your cash flow and compliance remain strong.
Get in touch
See also:
https://www.gov.uk/government/topical-events/spring-statement-2025
https://www.taxresearch.org.uk/Blog/2025/03/26/the-spring-statement-a-rolling-blog-post/
https://blog.bham.ac.uk/cityredi/what-is-the-anticipated-impact-of-the-spring-statement-2025/
27/03/25
**Voluntary Disclosure to HMRC: Is It Necessary**
Voluntary disclosure is the act of informing government services, such as HMRC, about a mistake or non-compliant activity without being prompted.
This is all about open and honest business practice that aims to put matters right when your accounts financial records have gone astray, regardless of their cause.
Should I Voluntarily Disclose Information to HMRC?
Our online accountant always recommend considering voluntary disclosure when necessary.
The most severe penalties and legal actions from HMRC arise from non-disclosure related to tax fraud, avoidance, or deliberate deceit.
HMRC takes investigations seriously, particularly when it uncovers previously unknown financial irregularities.
Voluntary disclosure demonstrates honesty and can significantly reduce penalties or legal consequences.
What Happens When You Make a Voluntary Disclosure?
When you voluntarily disclose non-compliance, HMRC will assess the issue and determine the necessary corrective action.
In many cases, voluntary disclosures involve minor errors, such as underpaid income tax, which HMRC will calculate and give you 90 days to repay.
However, if your disclosure involves deliberate tax evasion, HMRC may escalate the matter.
The severity of legal action depends on the circumstances, but voluntary disclosure generally results in more lenient penalties than if HMRC discovers the issue independently.
When Should I Consider Disclosing Financial Irregularities?
You should consider making a full voluntary disclosure to HMRC if you are aware of any non-compliance with your tax returns or financial reports. This applies only to issues that HMRC has already recorded.
If you have discrepancies in your accounts that have not yet been submitted, and you can correct these without disclosure, you are not required to inform them.
You should disclose information if your tax data is inaccurate, if there are discrepancies between the figures you provided to HMRC and your actual earnings/outgoings, or if you intentionally misled HMRC through a tax-avoidance scheme.
Examples may include inaccuracies in income tax, capital gains errors, failure to pay National Insurance contributions, or other simple mistakes.
Issues might also relate to claimed expenses, inheritance tax, reported interest on credit card payments or loans, or charity contributions.
If you know something is wrong, it is best to declare it.
How Do I Contact HMRC for Voluntary Disclosure?
HMRC provides a clear process for disclosing unpaid tax. Begin by identifying yourself as a taxpayer through your personal details and tax reference number.
Next, notify HMRC of what you wish to disclose and include any relevant documents or details that help explain what went wrong and how it can be corrected.
What Happens If I Don’t Voluntarily Disclose?
Failure to disclose tax inaccuracies can lead to various consequences.
In some cases, nothing may happen. If you are never audited by HMRC, they may remain unaware of the inaccuracies.
Even if you know of discrepancies, if there is no evidence suggesting you are liable, HMRC may simply issue you a bill for what you owe during an audit.
The real risk arises if it is evident that you are aware of matters that should have been disclosed or if you actively engaged in tax avoidance and HMRC discovers it.
Penalties can be severe, and prosecution is a possibility. Tax avoidance is relatively common, so HMRC often makes examples of individuals found operating outside the law.
To protect your assets and interests, we strongly advise taking any opportunity to declare mistakes as soon as possible. While the likelihood of being caught is low, the consequences can be detrimental to both you and your business.
**Work with Us for Voluntary Disclosure: HMRC Specialists**
At Friendly Assist Accountancy, we offer a disclosure service to help you communicate with HMRC. We will first discuss your concerns and any issues you believe need disclosure.
Then we will assess the necessity of the disclosure and explore how we can support you in rectifying the situation, working alongside HMRC to manage the process.
If you are worried you might have made mistakes that need to be disclosed but aren’t sure, we can carry out an internal investigation of your finances, give feedback on any issues and guide you through what to do next.
Get in touch
See also:
https://www.taxadvisermagazine.com/article/voluntary-disclosures-how-correct-mistakes-tax-payments
25/03/25
**The Health Sector and NHS Reforms**
The UK government is implementing significant changes in the NHS by merging NHS England with the Department of Health to enhance efficiency and better meet the public’s healthcare needs.
However, there are concerns regarding potential impacts on staff levels and increased bureaucracy.
To fund these changes, National Insurance contributions for businesses are set to rise, particularly affecting small and medium enterprises (SMEs).
As a result, businesses will need to reconsider their strategies, including hiring practices, salary and benefits evaluations, utilizing gig workers, and potentially increasing prices for consumers.
1. NHS Overhaul and Government Influence
The UK government is planning to streamline the NHS by merging NHS England with the Department of Health and Social Care. This restructuring is expected to:
– Enhance efficiency
– Address long-standing issues
– Bring healthcare services closer to the public’s needs
While these changes aim to improve the healthcare system, there are valid concerns about their potential effects on staff levels, increased bureaucracy, and cost management.
2. National Insurance Contribution Hikes
To support these healthcare reforms, changes will be made to National Insurance contributions for businesses:
– Employer contributions will increase from 13.8% to 15%
– The earnings threshold for contributions will decrease from £9,100 to £5,000
These adjustments mean that businesses will face higher payroll taxes, which could disproportionately affect small and medium enterprises (SMEs) as they strive to manage costs.
Impact on Businesses & Strategies for Adaptation
With these new changes, businesses will need to adopt creative financial and operational strategies. Here are some suggestions on how to adapt:
1. Smarter Recruitment Strategies
– Consider hiring fewer permanent employees or delaying new job openings.
– Focus on manageable workforce growth.
2. Competitive Salary Management
– Re-evaluate salary offers for new hires.
– Review annual raises and bonuses.
– Keep top employees motivated with performance-based incentives.
3. Embrace Non-Monetary Benefits
– Offer flexible working arrangements to help reduce costs.
– Implement mental health and wellness programs for employee well-being.
– Expand remote work options to save on office expenses.
4. Utilize Flexible Workers and Contractors
– Engage freelancers or contractors instead of hiring full-time staff.
– This approach can help keep payroll costs lower while providing flexibility.
5. Outsource Training and Development
– Consider using third-party providers for training instead of in-house programs.
– This can be a cost-effective way to ensure your team is well-equipped.
6. Adjust Pricing If Necessary
– If necessary, some businesses may need to pass on costs to consumers through slight price increases on goods and services.
In a nutshell
The NHS restructuring aims to improve our healthcare system and make it more accountable, but it may bring financial challenges for businesses.
With the rise in National Insurance contributions, employers will need to rethink their workforce strategies.
To stay ahead, businesses can implement cost-saving measures, flexible employment models, and innovative compensation options.
At Friendly Assist Accountancy, we’re here to help you navigate these challenges and find the best ways to adapt your business.
Get in touch
See also:
https://www.lrb.co.uk/the-paper/v41/n21/john-furse/the-nhs-dismantled
https://www.oldfieldadvisory.com/articles/2024/11/649-how-will-the-rise-in-ni-affect-your-business
https://www.kingsfund.org.uk/reshaping-nhs
21/03/25
**Tax & Self-Employment: A Quick Guide to Becoming Self-Employed and Managing Self-Employment Taxes**
Thinking about going self-employed? You’re not alone—over a million people in the UK have jumped into self-employment since 2001, making up more than 13.4% of the workforce!
After a drop due to the Covid 19 pandemic, this number is constantly rising again.
Being self-employed means you’re your own boss, which comes with perks like flexibility to set your own hours and the potential to earn more—about £5,000 extra on average compared to traditional jobs thanks to diverse earning opportunities.
Plus, people often find more satisfaction in doing what they love. But, before you take the leap, consider if you’re ready for the commitment and financial responsibility.
It’s essential to have a solid business plan and manage your money wisely, especially since you’ll need to keep track of your earnings and handle tax filings.
If you’re unsure about the legalities or tax stuff, it might be a good idea to reach out to an accountant for some guidance.
Summary: Benefits of Going Self-Employed
Flexibility
Set your own schedule and work on your own terms.
Higher Income Potential
Self-employed individuals often have the opportunity to earn more than traditional workers by leveraging multiple income streams, such as freelancing, content creation, and social media influence.
Career Fulfillment
Enjoy greater job satisfaction by working on your personal passions.
Tax Flexibility
Self-employed individuals have more control and flexibility over their taxes.
Although the implementation of Making Tax Digital (MTD) for income tax will provide HMRC with increased oversight of this sector’s tax situations, there are still significant advantages compared to the PAYE system.
At Friendly Assist Accountancy, we are happy to assist you in optimizing your tax savings and preparing for the new system. Contact our accountant to find out how you can reduce your tax bill.
Key Considerations Before Going Self-Employed
Are You Ready? Self-employment demands dedication, investment, and resilience. Are you prepared to make a full commitment?
It’s important to remember that to operate legally, you must register as self-employed with HMRC.
Startup Costs
Understand the financial requirements for launching your business and ensure you have the necessary funds.
Key Deadlines
If it’s your first year of self-employment, make sure to register by October 5th.
The deadline for submitting your tax return is January 31st for the previous tax year if you file online.
If you choose to file a paper return, the deadline is October 31st, although paper submissions are gradually being phased out.
What Taxes Do Self-Employed Individuals Pay?
As a self-employed individual, your tax obligations will depend on your earnings. Below is a breakdown of the taxes you may need to pay:
1. Income Tax: You can earn up to £12,570 tax-free (based on 2024/25 rates). Earnings above this threshold are subject to income tax.
2. National Insurance (NI):
– Class 2 NI: If your profits exceed £6,725 per year, you are required to pay £3.45 per week. If your profits are below £6,725, you do not have to pay anything, but you can choose to make voluntary Class 2 contributions.
– Class 4 NI: This is an additional tax on profits. For the 2023-24 tax year, the Class 4 rate is 9%. However, it will reduce to 6% in the 2024-25 tax year. This tax applies to trading profits between the annual lower profits limit (LPL) of £12,570 and the upper profits limit (UPL) of £50,270.3.
VAT (Value Added Tax): If your annual earnings exceed £90,000, you will need to register for VAT.
How to Save on Self-Employed Tax
– Claim Tax-Deductible Expenses: Business costs such as office equipment, travel, rent, and utilities can reduce your taxable income.
– Keep Detailed Records: Track your earnings, expenses, and invoices carefully to avoid errors. (We can assist with bookkeeping.)
– Use a Separate Tax Savings Account: Set aside a portion of each payment to cover your tax bills.
– File on Time: Late submissions can result in penalties. (Check out our blog for more information)
– Consult an Accountant: If you are uncertain about your tax obligations, seek professional advice. Contact our online accountant at Friendly Assist Accountancy now for a free business consultation. Ask your questions, get unbiased answers, and discover how we can support your business.
Final Thoughts
While self-employment provides freedom and financial opportunities, it also requires discipline in managing taxes.
Understanding self-employed tax regulations and planning ahead can help you avoid fines and maximize your profits.
If you need assistance, don’t hesitate to seek professional tax advice to ensure compliance and reduce stress.
If you are looking for self-employed tax support, whether it’s filing returns or managing your finances, we are here to help.
Get in touch
See also:
https://www.litrg.org.uk/tax-nic/tax-introduction/tax-and-nic-rates-and-bands
https://www.gov.uk/self-assessment-tax-returns/deadlines
14/03/25
**A Friendly Guide to Online Accounting**
Welcome to the world of online accounting!
This modern approach is changing the game when it comes to managing your business finances.
Say goodbye to stuffy meetings and mountains of paperwork—online accounting lets you handle everything with ease and flexibility, all from the comfort of your own space.
How it Works:
* Instead of in-person meetings and paper files, online accountants manage finances remotely via digital communication and cloud-based software.
* They provide services like tax preparation, financial reporting, and advisory, just like traditional accountants.
Who Benefits:
• Online accounting is particularly beneficial for small and medium-sized businesses and the self-employed, offering affordable and flexible financial management.
Online accounting often utilizes cloud-based software and remote communication to manage business finances.
It offers several advantages over traditional accounting, including:
Convenience and Flexibility: Connecting with Your Accountant Made Easy
Access comprehensive accounting services whenever and wherever you need them, with the added convenience of communicating through video calls, email, or phone.
This allows you to receive expert financial guidance regardless of your location or schedule.
One of the best things about online accounting is how it makes communication so smooth without the need to meet in person.
Many online accountants pride themselves on quick responses, often getting back to you the same day.
Budget-Friendly Benefits & Value for Money
Lower overheads for online accountants translate to cost savings for businesses, with transparent, fixed fees.
We all know that running a business can get pricey, but online accounting is here to help you save.
Most online services offer clear, fixed pricing, which helps you avoid those hidden fees.
You’ll have a better handle on your expenses, allowing you to focus your budget on growing your business and making it thrive.
Embracing Technology for Better Results
Online accountants leverage advanced accounting software, providing swift financial reporting and improved efficiency.
Another perk of online accounting is the technology that powers it.
We at Friendly Assist Accountancy use cutting-edge software, like Xero and QuickBooks to provide financial reporting and automate lots of tedious tasks.
This means fewer mistakes and a lot more accuracy in your financial records. You’ll have up-to-date insights at your fingertips, enhancing positive decision-making.
Reduced Admin
Features in accounting softwares minimize time spent on administrative tasks.
Who doesn’t want to spend less time on paperwork?
With easy access to your financial data, your accountant can offer up-to-date advice, allowing you to focus on what really matters—growing your business and pursuing your goals.
Going Green with Online Accounting
Digital communication and document storage reduce travel and paper usage.
We’re all becoming more aware of our impact on the planet, and online accounting does its part by cutting down on paper usage and travel.
By embracing a digital approach, you’re not just simplifying your accounting; you’re also contributing to a reduced carbon footprint and a healthier environment.
A World of Options
With online accounting, you’re no longer stuck with just local options. You can choose an accountant from anywhere who offers the services you need.
This means you can find the perfect match for your business without the constraints of geography, ensuring you get the best service possible.
Enhanced Collaboration
Digital document sharing and real-time account access are vital for collaboration between businesses and accountants.
These tools keep financial information up to date, enabling timely insights and reducing errors.
This efficiency enhances the partnership and supports informed decision-making.
In a Nutshell
In summary, online accounting is a friendly, exciting way to manage your business finances.
It offers quick communication, cost savings, and a more sustainable approach—all designed to help you thrive in today’s fast-paced world.
Whether you’re a small or medium-sized business or a freelancer, online accounting provides the support you need to focus on what you do best. Embrace the change, and watch your business flourish!
Get in touch
See also:
https://www.otsnews.co.uk/online-accountants-and-the-major-benefits-of-hiring-them/
12/03/25
**Why is hiring an accountant important**
All businesses, no matter how large or small, are required by law to keep financial records.
Hiring an accountant is essential for businesses for several reasons
It ensures proper financial management and compliance, allowing business owners to save time and focus on growth instead of bookkeeping.
Accountants offer expert guidance on financial planning and tax optimization, assist in navigating complexities during periods of rapid growth, and provide the confidence that comes with accurate financial management.
They can also conduct competitor analysis and leverage their network for partnerships.
Key benefits of working with an accountant
* Financial Management and Compliance: Accountants ensure accurate financial records, tax compliance, and help avoid costly errors.
* Time Savings: They handle bookkeeping and financial tasks, freeing up your time to focus on business growth.
* Expert Guidance: Accountants provide strategic advice on financial planning, tax optimization, and business growth.
* Growth Support: They help manage financial complexities during rapid growth and identify opportunities for expansion.
* Financial Confidence: They ensure accurate financial management, reducing the risk of mistakes and legal issues.
* Competitor Analysis and Networking: Accountants can analyze competitors and leverage their network to build valuable partnerships.
* Exit Strategy Planning: They can help develop a plan for a smooth business exit if needed.
What are the warning signs that indicate you might need an accountant?
* Your business isn’t growing as expected.
* You lack confidence in managing your finances.
* Your business is experiencing rapid growth.
* You don’t have enough time for accounting tasks.
* You find yourself going off track with buisness goals.
If you’re noticing warning signs like stagnant growth, feeling unsure about managing your finances, not having enough time for accounting tasks, or veering off your business goals, it might be time to consider hiring an accountant.
The good news is that the long-term benefits—like saving time, staying on top of taxes, and planning for the future—really do make it worth the investment.
Their expert advice can guide your financial decisions and keep your accounts accurate, which builds trust.
An accountant can help you spot growth opportunities, ensure you’re compliant with taxes, and give insights into what your competitors are doing so you can stay ahead.
Plus, they can introduce you to valuable connections and help craft a solid plan for the future, like an exit strategy. Overall, having an accountant in your corner sets you up for success!
Contact our online accountant at Friendly Assist Accountancy and ask your questions, get unbiased answers, and discover how we can support your business.
Get in touch
See also:
https://www.freshbooks.com/en-gb/hub/accounting/do-i-need-an-accountant
10/03/2025
**Making Tax Digital (MTD) for Income Tax**
We want to share some important information about Making Tax Digital (MTD), a big change coming to tax reporting and accounting in the UK.
HMRC is rolling this out to help tackle the tax gap, which was over £39 billion in the 2022/23 tax year.
The idea is to encourage sole traders, landlords, and anyone who files self-assessment tax returns to keep digital records, use approved MTD software, and submit their tax returns quarterly.
This means if you’re a sole trader or landlord, you’ll now file five tax returns a year instead of just one!
## Important Tax Deadlines##
Here’s a quick look at the upcoming deadlines:
1st Quarter: Due by 5 August 2026 (covers 6 April 2026 – 5 July 2026)
2nd Quarter: Due by 5 November 2026 (covers 6 July 2026 – 5 October 2026)
3rd Quarter: Due by 5 February 2027 (covers 6 October 2026 – 5 January 2027)
4th Quarter: Due by 5 May 2027 (covers 6 January 2027 – 5 April 2027)
Final Declaration: Due by 31 January of the year after the end of the tax year
So, when do you need to get on board? If your annual business or property income is over £50,000, mark 6 April 2026 on your calendar.
For those with income over £30,000, the deadline is April 2027. You can even sign up voluntarily right now.
At Friendly Assist Accountancy, we’re here to help!
We support landlords, letting agents, and property owners in navigating the complexities of Making Tax Digital (MTD) and property tax regulations.
As certified advisors for Xero and QuickBooks, we can guide you through the transition to MTD with ease. It’s essential to use compliant software, and getting started early is a smart move.
We can handle the bookkeeping to keep your records compliant, allowing you to focus on growing your business, enjoying retirement, or expanding your property portfolio.
Get in touch
See also:
https://www.usehammock.com/2024/06/11/mtd-for-landlords-update-2024/
https://www.litrg.org.uk/tax-nic/how-tax-collected/making-tax-digital-income-tax
08/03/2025
**Tax Year – Key Deadlines to Consider**
As we approach the end of the tax year, or fiscal year, on April 5th, it’s important to focus on the upcoming deadlines for the 2024/2025 tax year.
By staying informed, you can avoid unnecessary fees and optimize your tax situation.
To avoid penalties, remember that the deadline for filing your self-assessment return was January 31, 2025.
At Friendly Assist Accountancy, we are here to guide you through the process, helping you manage your accounts and taxes effectively.
To assist you further, we’ve created a detailed overview of the penalty structure.
Please keep in mind that the dates mentioned refer to the previous tax year.
If you file your tax return six months or twelve months late, penalties will apply according to the interaction rule outlined in paragraph 17(3), which ensures that total penalties do not exceed 100% of the tax owed.
Additionally, remember that HMRC charges interest on late payments at a typical rate of 7%.
It’s also crucial to communicate any changes in your tax liabilities to HMRC. This includes income tax, capital gains tax, and Class 2 and Class 4 National Insurance contributions.
If you start earning from a new taxable income source or realize a capital gain, make sure to notify HMRC if you expect to owe tax on it.
Timely notification helps you avoid a ‘failure to notify’ penalty, which is calculated based on the potential tax revenue that could have been collected had you informed HMRC on time.
However, if you identify any oversights and work collaboratively with HMRC to resolve them, there may be an opportunity for penalty reduction.
By understanding these deadlines and procedures, you can navigate your tax responsibilities more effectively and avoid potential pitfalls. We’re here to support you every step of the way.
Get in touch
See also:
https://taxaid.org.uk/tax-information/self-assessment-tax-return/late-tax-returns
https://www.litrg.org.uk/tax-nic/tax-checks-and-disputes/tax-penalties-and-interest
01/03/25
**Welcome to the Friendly Assist Accountancy Blog!**
We’re excited to chat about accounting and bookkeeping in an approachable way. Let’s dive into the latest topics together!