Against a backdrop of shifting global tides — from trade tariffs across the Atlantic to the uncertainty of unfolding conflicts in the Middle East — Chancellor Rachel Reeves sought to steer a stable course for the British economy in a bid to promote financial stability in a time of turbulence. As such, there were no major changes to tax or spending policies announced.
For small and medium-sized enterprises, the Chancellor reaffirmed the Government’s commitment to the digital evolution of the economy, with the horizon for Making Tax Digital drawing closer for sole traders and landlords. However, a subtle shift in the fiscal landscape awaits those investing in their future; the main Writing Down Allowance (WDA) for plant and machinery is set to be trimmed from 18% to 14% from April 2026. While avoiding the shock of immediate new levies, she remained steadfast on the scheduled path for reforms, including the rising rates of Business Asset Disposal Relief to 18%. To temper these transitions, a vast construction skills package was unveiled to cultivate a new generation of craftsmen — a welcome beacon for businesses that have long struggled with a depleting talent pool.
For the individual taxpayer, the Statement painted a picture of cautious recovery beneath a sky still heavy with historic burdens. While inflation is predicted to drift back toward its 2% target, the reality for many remains defined by the frozen tides of personal tax thresholds. This persistent weight of fiscal drag will be further felt via the Dividend Tax rise from 6 April 2026 — an increase of two percentage points to 10.75% for basic rate and 35.75% for higher rate taxpayers — alongside the newly implemented cap on Inheritance Tax and shifting boundaries for ISA allowances.
Chancellor Reeves fully acknowledged the turbulence beyond British borders and cautioned that these events will no doubt have an impact on the UK economy going forward, noting that geopolitical tremors have threatened the security of global supply chains.
For those seeking to escape will soon be affected by a hike in Air Passenger Duty as from 1st April 2026 there will be an increase of up to £2 for short-haul economy flights and up to £12 for long-haul flights.
If you’d like to find out more about how the Chancellor’s Spring Forecast might impact your business and personal tax situation, please click on the thumbnail below to access the WHA Spring Forecast Summary.
If you’d like further guidance specific to your tax situation, please feel free to contact us on 020 8878 8383 or via email info@whitehartassociates.com.
