We thought it would be useful to share an IP’s alternative perspective of the key headlines from the Budget.

• The lifetime limit for CGT for those eligible for Business Asset Disposal Relief is reducing from £1 million to £500,000 from April 2027.
• Changes to the distributions framework to “protect” the capital treatment for genuine changes in ownership including families passing down their businesses.
• Founders’ relief which provides a 10% CGT rate on up to £10m of lifetime gains for qualifying founders of high growth innovative companies from 6 April 2027.
• Debt relief scheme for households with energy debts commencing in 2027.
• Self-assessment – more regular “in year” payments for those who are subject to SA from April 2029.
• HMRC will require all taxpayers to set up direct debit arrangements for VAT and PAYE from April 2029.
• HMRC will be able to take payments directly from taxpayers’ bank accounts from July 2029 to recover tax debts.
• Invest an extra £70m over the next 5 years in HMRC’s partnerships with debt collection agencies
• Recruit an additional 670 HMRC compliance staff in addition to the additional recruitment already announced.
• Strengthen the framework for how HMRC publishes details of deliberate tax cheats.
• Increase income tax on property / savings to 24%, 44% and 49% from 6 April 2027
• Clarify the tax treatment of termination payments which will take effect from 28 October 2026.
• Director disqualification – enable the court to disqualify a director for up to five years if they have breached HMRC Securities Legislation

The Government are trying to close the “tax gap” by giving HMRC significant additional resources and powers in their dash for cash. By requiring self-assessment to be paid in regular instalments during the course of a year and giving HMRC powers to directly recover funds from a taxpayer’s bank account this could cause a significant increase in the numbers of taxpayers experiencing cash flow difficulties.

If you have any clients who are considering a solvent liquidation and they hold assets of more than £500,000, they should initiate the process prior to April 2027!