Spring is in bloom, but the usual themes of hope and renewal have appeared to be in short supply. The Spring Statement delivered gloomy news about March headwinds that were impacting the UK's growth forecast, resulting in a more difficult fiscal event than the Government had hoped for. Meanwhile, the off and on nature of US tariffs has been as sudden and as changeable as an April shower.
But there are reasons to be cheerful. With the Spring Statement the Government announced a commitment to ensuring "that the UK is the best place in the world to start and grow a business", with a series of roundtables with key stakeholders held in April, and a consultation published on a new facility to provide increased tax certainty for major investment projects.
Finally, it will also come as no surprise that the Government is again allocating further resource to HMRC to boost compliance and prune the tax gap, with a particular focus on tackling wealthy offshore non-compliance. The new tax year has brought new rules for non-doms, but there is also a suite of less high-profile measures and tools at HMRC's disposal to help them achieve this aim, such as a reward scheme for informants to identify tax fraud, and AI to find hidden offshore wealth. We can expect to see continued increased activity from HMRC and individuals and companies may be well-advised to take a little time to ensure that their affairs are well tended for the year ahead.
We provide a round-up of our commentary on the Spring Statement and other recent topics below, as well as a look at some recent developments in the case law.
The Spring Statement
As promised, this Statement did not contain any significant tax announcements, but it did reiterate HMRC's continued focus on closing the tax gap, with consultations being published on the use of third party data and strengthening HMRC's powers to take action against tax advisors facilitating non-compliance. The Government is also committing additional resource for HMRC's debt management capacity and compliance staff, as well as in tackling "offshore tax non-compliance by the wealthy". Read our thoughts on the Spring Statement.
Reward scheme for Informants
One of the most interesting measures to be announced in the Spring Statement is the introduction of a new reward scheme designed to encourage informants to notify HMRC about tax fraud. The full details are still to be announced, but the scheme will be based on the approach for whistleblowers used in the US and Canada, where rewards are far more generous and linked to the amount of tax collected. Gideon Sanitt, Helen Harvey and Victoria Braid consider the new scheme and its likely application.
Carried away
The taxation of carried interest in the UK is a hot topic at the moment, with a revised regime due to come into force from 6 April 2026 which will subject all carried interest to an exclusive charge to income tax. Until then, the current rules apply (albeit since 6 April 2025 at the higher rate of 32% for carried interest capital gains). HMRC have recently published new guidance on how carried interest is reported in self-assessment tax returns and what supporting information is needed, but this information may be difficult to obtain. George Apps and Sam Shillam consider what this means for private capital firms and their UK executives for the current tax year.
A nudge for private equity firms
HMRC uses its upstream compliance powers, or "nudge" letters as a tool to encourage certain categories of taxpayers to review their tax affairs and voluntarily correct any errors. These letters are sent out to large groups of taxpayers who meet certain criteria, often on the basis of information received by HMRC via its wide range of data sources. Over the past few years, HMRC has launched a number of "nudge letter" campaigns targeting various groups of taxpayers and different types of tax. We have recently become aware of several private equity fund managers receiving nudge letters from HMRC concerning VAT compliance. Chris Mortimer and Lucy Green discuss what this means for private equity fund managers.
Offside but not off-payroll
In the recent FTT case of Bryan Robson Ltd v HMRC [2025] UKFTT 56 (TC) the taxpayer successfully argued that a licence (contained in a wider "Ambassador Agreement") for Manchester United Football Club to exploit Mr Robson's "image rights" fell outside of the ambit of the IR35, or "off-payroll working" rules as it related to intellectual property rights, rather than the personal performance of services. The fee paid in relation to this licence was therefore not taxable as employment income. The tax treatment of "image rights" has been a focus for HMRC and has been subject to scrutiny in the courts in other contexts, but this is the first time a taxpayer has argued that a provision for the exploitation of "image rights" falls outside of IR35. Gideon Sanitt and Jackelyn West discuss the FTT's decision.
"Need to know" series on tax disputes
With HMRC taking an increasingly aggressive approach to compliance, more and more taxpayers are finding themselves involved in the enquiry and appeal process. This can be a daunting experience - different taxes are subject to different administrative regimes and HMRC have a wide range of powers to gather information about a taxpayer's affairs. We have recently launched a series of "need to know" notes providing a high-level overview of the key processes and points to consider when dealing with a tax dispute. Read the series so far.
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