Author Archives: accounts

Choosing a Business Rates Agency

The Valuation Office Agency (VOA) has issued updated advice to help business owners choose and monitor business rates agents more effectively. A key message is that the name listed in the Check and Challenge service must match the name on the signed contract. If it does not, this could be a sign of misleading activity, and business owners are encouraged to report any mismatch directly to the VOA.

This guidance comes in response to cases where agents have changed their trading names after complaints or regulatory scrutiny. The VOA is reminding businesses that transparency and due diligence are essential when appointing an agent.

Although there is no requirement to appoint an agent, many businesses choose to do so for support with managing business rates. If appointing one, it is important to conduct independent research and not rely on an agent who contacts you first. Check that any agent is a member of a recognised professional body such as the IRRV, RICS or RSA. These organisations enforce ethical codes and can handle disputes and complaints.

Before signing a contract, business owners should review it carefully to understand the services offered, the fee structure, how to exit the agreement, and the duration of the appointment. Be cautious if the agent uses high-pressure tactics, requests large upfront payments, or makes bold claims about savings.

Once an agent is appointed using their agent code through your business rates valuation account, all correspondence with the VOA can be monitored. You should not share your personal login details. If the agent later operates under a different name, it is your responsibility to alert the VOA.

If issues arise and the agent is not part of a professional body, concerns should be raised with Citizens Advice or Trading Standards for further support.

Source:Other | 27-07-2025

IHT Unused Pension Funds and Death Benefits changes

It was confirmed with the publication of the draft Finance Bill 2025–26 that measures first announced in the Autumn Budget 2024 to bring most unused pension funds and death benefits into the scope of Inheritance Tax (IHT) will start from 6 April 2027. This will significantly extend the IHT net, capturing pensions that were previously excluded. Individuals with sizeable pensions will need to consider these changes with some care, and review their estate planning accordingly.

This measure will affect individuals inheriting estates within the scope of IHT, including beneficiaries of any unused pension funds or death benefits included in those estates. Personal representatives will be liable for reporting and paying any IHT due on unused pension funds and death benefits.

Death-in-service benefits payable from a registered pension scheme and dependants’ scheme pensions from a defined benefit arrangement, or from a collective money purchase arrangement are excluded from these changes and will not be within the scope of IHT.

There were some changes to the original proposals following a technical consultation that closed in January 2025. As a result, personal representatives, rather than pension scheme administrators, will now be primarily liable for reporting and paying IHT on any unused pension funds and death benefits.

This means that pension scheme administrators and personal representatives will need to work together in administering IHT on pensions. There are concerns that this process could lead to multiple issues, including payment delays, greater complexity and GDPR privacy matters.

Source:HM Treasury | 22-07-2025

IHT Agricultural and Business Property Relief changes confirmed

Despite intense lobbying by the farming community, the proposed reduction in IHT Business and Agricultural Property reliefs are included in the draft Finance Bill 2025-26.

On 21 July 2025, the government published draft legislation for Finance Bill 2025-26. The consultation period for the draft legislation is open until 15 September 2025. This comes at a time when the government has seen borrowing in June surge to the second highest level on record and placing further pressure on public finances and increasing the urgency for tax reforms.

The legislation includes confirmation of a significant overhaul of Inheritance Tax (IHT) reliefs that were first announced in the Autumn Budget 2024. These measures faced criticism over their potential impact on small farms and rural communities. However, with the publication of the Finance Bill, these measures now look set to come into effect from 6 April 2026.

The changes will see the introduction of a new £1 million allowance that will apply to the combined value of property in an estate qualifying for 100% business property relief or 100% agricultural property relief. This means that the existing 100% rate of IHT relief will only apply to the combined value of property in an estate qualifying for 100% business property relief or 100% agricultural property relief. The rate of IHT relief will be reduced to 50% for the value of any qualifying assets over £1 million. This means that any assets receiving 50% relief will be effectively taxed at 20% IHT (the full rate being 40%).

This change applies per individual, meaning married couples could potentially pass on up to £3 million tax-free between them (when combined with nil-rate bands).

The government has also confirmed they will reduce the rate of business property relief available from 100% to 50% in all circumstances for shares designated as “not listed” on the markets of recognised stock exchanges, such as AIM. The existing rate of relief will continue at 50% where it is currently this rate and will also not be affected by the new allowance.

It was also announced that the option to pay IHT by equal annual instalments over 10 years interest-free will be extended to all qualifying property which is eligible for agricultural property relief or business property relief.

Source:HM Treasury | 22-07-2025

Capital Gains valuations of goodwill

Who values goodwill when a business is sold? HMRC's Shares and Assets Valuation team takes the lead.

Whether the goodwill belongs to a sole trader, partnership or limited company, HMRC’s SAV team will either accept the submitted valuation, give their own open market estimate, or state they need more information.

For non-corporate goodwill, the SAV team have the following options for valuing goodwill:

  • Accepting the valuation
  • Providing an opinion of Open Market Value if the claim appears under or overvalued
  • Stating that insufficient information is available to form a view

Corporate goodwill valuations are usually submitted directly to SAV as informal or formal requests. When Trade Related Property is involved, the SAV team will liaise with the Valuation Office Agency.

These are the key issues the SAV team will look at when valuing goodwill:

  • the full sale and purchase documentation relating to the transfer of both tangible and intangible assets;
  • succession arrangements;
  • the valuation approach used – e.g. capitalisation of profits, super profits or a trade specific method;
  • the activities of the business and role of the owners within it;
  • the financial statements/accounts (including the detailed trading and profit and loss account) for the 3 years before valuation;
  • any other relevant financial information;
  • appropriate yield and multiples of comparable companies and sectors;
  • the commercial and economic background at valuation date;
  • how the personal goodwill of the owner has been reflected in the valuation; and
  • any other relevant factors.

Open market value must exclude any assumptions about a "special purchaser" unless industry norms support synergy-based premiums.

Source:HM Revenue & Customs | 21-07-2025

VAT relief for the disabled

VAT relief is available on goods and services for people with long-term illnesses or disabilities. 

There are special VAT reliefs available for certain people living with disabilities or long-term illnesses. These reliefs are generally available on certain products and services designed specifically for their personal or domestic use. This VAT relief covers not only the product itself but also installation, repairs, maintenance as well as related spare parts and accessories.

Eligible items typically include adjustable beds, stair lifts, wheelchairs, medical aids, low vision aids (excluding glasses or contact lenses) and home building works such as ramps, widened doorways or lifts. Motor vehicles purchased or leased through the Motability scheme may also qualify.

To benefit from this relief, the individual must meet HMRC’s criteria which usually covers those with a long-term physical or mental condition affecting daily life, chronic illnesses such as diabetes or terminal conditions. Age criteria alone, or temporary disabilities, do not qualify.

Buyers must provide a written declaration confirming their eligibility. Most suppliers will provide a standard form for this purpose.

For imported items, qualifying goods for personal use can benefit from VAT relief if they are properly declared.

Local councils may also offer support or funding for necessary home adaptations, helping ensure greater independence and quality of life for disabled individuals.

Source:HM Revenue & Customs | 21-07-2025