The 2025 Spring Statement just dropped, and if you’re running a business, you might be wondering: “What does this actually mean for me?”
No jargon here—just a clear, friendly guide to what’s changing, how it might affect your business, and what you can do to stay one step ahead.
Making Tax Digital (MTD) – Expanding Further
you’re a sole trader or landlord, there’s a big change coming your way. The government is expanding Making Tax Digital for Income Tax.
What’s happening?
You’ll need to start keeping digital records and submitting updates to HMRC four times a year using approved software like Xero, QuickBooks, or FreeAgent.
Who’s affected and when?
April 2026: Income over £50,000
April 2027: Income over £30,000
April 2028: Income over £20,000
👉 Around 900,000 businesses and landlords will be brought into the system by 2028.
✅ Tip: Start getting comfortable with cloud accounting software now. The earlier you make the switch, the easier things will be later.
Inflation and Growth – A Mixed Bag
There’s good news and some slower news on the economy front.
Inflation is finally heading down—forecast at 2.8% this year, and expected to hit the Bank of England’s target of 2% by 2027.
Growth is still a bit sluggish, with the economy expected to grow by 1% in 2025.
👉 What does that mean for you? You might notice prices stabilising a bit (finally!), but consumer spending may still be cautious this year.
HMRC Gets Tougher on Tax Evasion
The government is putting more money into cracking down on tax dodging. That means:
More HMRC staff
Bigger penalties
Aiming to raise £1 billion through enforcement
✅ Tip: This is a great time to review your books, check you’re compliant, and consider tax investigation insurance. (Yes, it’s tax-deductible!)
Investment in NHS and Public Services
The NHS will get funding for 2 million extra appointments to help cut backlogs, and there’s a new £3.25 billion fund to modernise public services.
While this may not directly affect your business, it’s a welcome boost for the overall wellbeing of your team and customers.
Housing and Construction – Big Opportunities Here
The government is aiming to build 1.3 million new homes over five years. To support this, there’s:
£600 million to train 60,000 more construction workers
Extra planning reforms and investment in housing infrastructure
👉 If you’re in property, trades, construction, or training, there could be funding or partnership opportunities worth exploring.
Defence + Tech Investment = Opportunity
Defence spending is going up to 2.5% of GDP, and there’s £2.2 billion earmarked for:
AI
Cybersecurity
Drones
Advanced tech
👉 This is great news if you’re in engineering, tech, R&D or security—keep your eye on government grants and contracts that could help you scale.
Changes to Universal Credit and Welfare
Some key welfare updates:
The standard Universal Credit allowance will rise to £106/week by 2029–30
But the health element is being cut by 50% and frozen for new claimants
The aim is more targeted support—more help for those who truly can’t work, and more encouragement for those who can
This might bring more people into the workforce over the next few years, which could ease recruitment for businesses.
National Living Wage is Going Up
From April 2025, the National Living Wage will rise by 6.7%.
For example, someone earning £10.42/hour will now earn about £11.12/hour
👉 Good news for employees, but if you’re an employer, budget for higher payroll costs from April.
✅ Tip: Now’s the time to review your pay structure and check if you’re still within budget—especially if you have team members on minimum wage.
What About Everyday Households?
On the household front, there’s a little good news:
The average household is expected to be £500 better off this year thanks to a mix of wage growth and falling inflation
Not huge, but after the past few years, we’ll take any win we can get!
The Chancellor’s Two Big Priorities
Chancellor Rachel Reeves was clear on what she’s aiming for:
Stability – Keep the public finances under control
Investment – Put money into infrastructure, housing, and the future of the economy
So expect more strategic, long-term thinking rather than lots of quick giveaways.
How We Can Help
If you’re not sure how these changes apply to you, don’t worry—we’ve got your back.
We’re here to help you:
✅ Get ready for Making Tax Digital
✅ Review your books for compliance and efficiency
✅ Plan ahead for staff costs and wage increases
✅ Explore funding opportunities in your industry
Let’s make sure your business is not just staying afloat, but thriving through 2025 and beyond
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