2025 Spring Statement: Government pushes forward with Autumn Budget agenda
Government is sticking to its original course set in the 2024 Autumn Budget and makes a renewed commitment to going further and faster on growth, security, welfare reforms and efficiency measures. As part of this strategy, it is intensifying efforts to combat tax avoidance and evasion while introducing stricter late payment penalties.
Leading up to the Spring Statement on 26 March, speculation was high that the Chancellor could take the opportunity to make further changes to the tax system, which did not materialise. Instead, the Chancellor homed in on economic growth and stability.
While the absence of additional tax hikes may be a relief, the existing cost burden remains significant.
- From April 2025, businesses face a 1.2% increase in employers’ National Insurance (NI) contributions, a lower threshold for NI payments, and a rise in the National Living Wage (NLW), which brings a ‘triple whammy’ cost impact for many businesses.
- More individuals than ever will be impacted by the Inheritance Tax changes announced in the Autumn Budget, but they have a welcome breathing space of one year to make the necessary changes.
Spring Statement measures to be aware of
While there were no major new announcements impacting businesses (unlike the Autumn Budget), there were a few to be aware of, as shown below:
- In addition to new measures announced in the Autumn Budget to raise £6.5bn by cracking down on tax avoidance and evasion, the Chancellor said there would be new measures announced to increase that amount by £1bn. With this in mind, the importance of paying the right amount of tax, as well as ensuring tax affairs are accurate and up-to-date, is underlined.
- The rollout of Making Tax Digital for Income Tax Self Assessment (MTD for ITSA) is to be expanded to sole traders and landlords with incomes over £20,000 from April 2028. From April 2026, the end-of-year tax return will also be required to be submitted through MTD software versus using HMRC’s online filing service.
- The government will increase late payment penalties for VAT taxpayers and income tax Self Assessment taxpayers as they join MTD, from April 2025 onwards. 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.
We are here to help
If you have any questions in relation to the Statement or would like to discuss your tax position, please get in touch.
Webinar | Exploring and unwinding the Spring Statement announcements
For those who haven’t yet registered for our Spring Statement webinar taking place on 31 March. At this webinar, our specialists will break down the latest announcements and provide the insights you need to protect your wealth, navigate the rising cost of business, and plan for the future.
Podcast | Spring Statement 2025
In this special Spring Statement episode, Azets’ expert advisers join host Emma Sheppard for live reaction to Chancellor Rachel Reeves’ latest fiscal update.
