Spring Statement 2025
Read Our Spring Statement Summary here
The Chancellor did meet her commitment that there would be no major tax announcements but tax is only one side of the equation.
The other is spending and the Spring Statement confirmed a number of the measures recently announced, namely:
• cuts to the welfare state
• cuts to the civil service
• an increase in defence spending.
There were also announcements about the rollout of the Making Tax Digital (MTD) for Income Tax project
Making Tax Digital Announcements
The rollout of MTD for Income Tax will be expanded to include a wider range of small businesses and will operate as follows:
• It will start from April 2026 for sole traders and landlords with qualifying incomes over £50,000.
• It will extend to those with qualifying incomes over £30,000 in April 2027.
• It will extend again to those with qualifying incomes over £20,000 from April 2028.
Announcements made to increase late payment penalties
The government will increase late payment penalties for VAT taxpayers and Income Tax Self Assessment taxpayers as they join MTD for Income Tax from April 2025.
The new rates will be 3% of the tax outstanding where tax is overdue by 15 days,
plus
3% where tax is overdue by 30 days,
plus
10% per annum where tax is overdue by 31 days or more.
