With the UK Autumn Budget 2025 scheduled for 26 November, Jerroms, part of the Sumer Group, is encouraging Midlands-based businesses and individuals to prepare for a wave of potential tax changes amid ongoing economic uncertainty. The country faces sluggish growth and a £40 billion fiscal shortfall, prompting widespread speculation that further tax increases may be introduced to meet government spending commitments and comply with fiscal rules.
Experts at Jerroms, part of the Sumer Group, are advising clients to stay closely connected with their advisers in the lead-up to the Budget. “No matter what happens on Budget day, our advice is clear: stay in close contact with us,” said Lucas Markou, Director, Jerroms “We’re here to ensure your tax affairs are as robust and efficient as possible, no matter the changes ahead.”
Nick Wright, Head of Corporate Tax at Jerroms Miller Specialist Tax, highlights the pressure on the government’s fiscal pledges: “Labour’s manifesto commitment not to raise Income Tax, National Insurance, Corporation Tax or VAT remains under scrutiny as the scale of the fiscal deficit becomes clearer. While the government has so far focused on adjusting smaller revenue streams, such as Capital Gains Tax and Inheritance Tax, the question now is whether their pledge is still achievable.”
He added that while a new wealth tax appears unlikely, targeted increases affecting business owners are possible: “There’s growing speculation around National Insurance on partnerships, which would level the playing field between different business structures. But it’s important to remember that increasing taxes isn’t the only lever. Strategic tax reductions or targeted reliefs such as extending EIS and SEIS could stimulate investment and deliver more sustainable growth.”
Kate Moon, Tax Director at Jerroms, pointed to possible reforms in Inheritance Tax (IHT): “We’re anticipating significant changes, including extending the 7-year survival window to 10 years and possibly introducing a lifetime IHT charge on gifts made before death. These changes could significantly impact estate planning. Meanwhile, the continued freezing of personal tax allowances and thresholds means individuals may face higher tax burdens without inflationary adjustments. There are also rumours of a 2% increase in the basic rate of income tax and a corresponding 2% decrease in National Insurance. This shift could result in a higher tax burden for those not subject to NI, such as pensioners and landlords, while effectively maintaining the overall tax rate for employed individuals, aligning with the government’s pledge to protect ‘working people’.”
Daphne Hemingway, VAT Director at Jerroms Miller Specialist Tax, agrees that the Chancellor is unlikely to raise the headline rate of VAT from 20% but there are other modifications which could have a significant impact: “The registration threshold could drop from £90,000 a year to £30,000, pulling thousands of small businesses into the VAT net.”
After the government lost several Court challenges, “VAT may also be extended to ride-hailing apps like Uber and Bolt, levelling the field with traditional taxis.”
She also pointed to potential reliefs: “We could see the 5% VAT on domestic fuel scrapped, which would be welcome news for households.” She added that “VAT is a regressive tax because, even though everyone pays the same rate on taxable goods and services, it takes up a larger proportion of income from lower-income households. Thus, if the Chancellor takes a bolder approach, she might remove the zero-rating on children’s clothing, with support for low-income families shifting to Universal Credit or vouchers. These changes signal a shift towards a broader, more modern VAT system, targeted, but not without controversy.”
