Small businesses are expressing “deep concern” over new Companies House filing requirements set to take effect in April 2027. The changes will mandate all companies to use commercial software for annual accounts, eliminating traditional web and paper filing methods. Additionally, small and micro companies will be required to submit profit and loss statements for the first time, which could expose their financial performance to competitors. Martin McTague, national chairman of the Federation of Small Businesses, said: “Small business owners are deeply concerned at this regulatory expansion,” highlighting the potential costs and challenges associated with these changes. Companies House aims to enhance data accuracy and reduce errors through this software transition, promising further details on additional changes in the coming months.

Sir Keir Starmer has thanked businesses for bearing the brunt of the tax raid set out in last year’s Budget, saying the Government has “asked a lot of” British firms. Addressing the British Chambers of Commerce’s (BCC) annual conference, the Prime Minister said: “I fully acknowledge that this year, as we’ve had to fix the foundations of our country… we’ve asked a lot of you,” adding: “I want to acknowledge that it has made a huge difference.” This comes after a £23bn hike to employer National insurance contributions and a higher minimum wage. Meanwhile, BCC director general Shevaun Haviland has urged ministers not to make firms “pick up any more of the tax burden” as they face “huge cost pressures,” saying: “If there is one message I want government to take away, it is this: there must be no further tax increases at the autumn Budget.”

According to the latest Founder Barometer from Virgin Startup, three in five small business owners feel neglected by the Government, with 57% fearing for their survival in the coming year. This marks an increase from 50% last year, highlighting the growing concerns among SMEs amid rising economic pressures. The cost-of-living crisis remains the primary challenge for 33% of SMEs, although this has decreased from 52% the previous year. Access to finance is another significant issue, with over 60% of founders seeking better support in securing capital. Andy Fishburn, managing director at Virgin StartUp, said: “Small business founders are the backbone of the UK economy, yet the research highlights a large proportion are feeling under pressure in the current economic climate.”

According to HMRC, around 39.1m individuals are expected to be liable for income tax in the 2025/26 tax year, a significant increase from the 34.5m recorded in 2022/23. The number of higher rate taxpayers is projected to reach 7.08m, up from 5.1m in the previous year. Sarah Coles, head of personal finance at Hargreaves Lansdown, noted that fiscal drag has “hauled” over 6m more people into paying income tax, and 3.36m more into paying higher or additional rate tax. This increase is attributed to frozen tax thresholds, which have pushed many into higher brackets as their earnings rise. The analysis also shows that 2m more pensioners are set to have been dragged into paying income tax over the past four years.

Paul Johnson, the outgoing director of the Institute for Fiscal Studies (IFS), has warned that taxes in Britain are set to remain high for decades. He said: “The tax burden is going up at its highest level ever in this country,” and suggested that the Chancellor may need to increase taxes to meet fiscal rules. Mr Johnson highlighted potential measures such as extending the freeze on income tax thresholds or introducing a defence levy to raise funds. He expressed concerns that future governments will face increasing pressure to spend more on essential services, saying: “I think tax will go up further, and I am willing to predict that it will not come down from the highest level ever.” Recent forecasts from the Office for Budget Responsibility predict that the tax burden could reach 37.7% of GDP by 2027/28, the highest since records began in 1948.

Analysts have urged Chancellor Rachel Reeves against extending the freeze on income tax thresholds, with Rachael Griffin, a tax and financial planning expert at Quilter, saying: “The longer it’s left, the more damaging and entrenched it becomes.” Noting that the Treasury has become “increasingly reliant on the quiet revenue boost,” she warned: “Reversing that would come at a significant cost, particularly with pressure on public services and spending already high.”

City broker Andrew Wishart says a row over reducing the welfare budget could prevent the Bank of England from reducing interest rates. Mr Wishart, an economist at corporate bank Berenberg, says the Government’s failure to control public spending will either lead to higher-than-expected tax rises – which would “stymie business confidence” – or a rethink of fiscal rules, which would “roil” the gilt market and lead to higher interest rates. The Institute for Fiscal Studies and City analysts have warned that the Government will have to raise taxes to fund extra spending commitments, with economists at Capital Economics and KPMG suggesting that Chancellor Rachel Reeves will have to find £20bn in extra receipts to restore her £9.9bn fiscal headroom.

Andrew Bailey, governor of the Bank of England, says the Monetary Policy Committee is watching signals of a rapidly softening labour market “very closely,” telling the British Chambers of Commerce conference that sticky wage growth had been a significant factor in the decision to keep rates higher for longer than many analysts expected. Noting that officials watch pay “very carefully,” Mr Bailey said: “Wage growth remains an important factor behind the remaining persistence in services price inflation in particular.” He added that data points to a “significant decline in wage growth in the year ahead,” as well as a softening in employment after a “very tight” labour market in recent years.

A review has flagged “deep seated” issues within the Office for National Statistics (ONS) that need to be addressed before the UK’s official statistics agency can “rebuild its reputation.” The review, which calls for a £10m overhaul and a split of the national statistician role, says many of the issues stem from “inadequacies” in the way the ONS plans and makes decisions. Sir Robert Devereux, a former top civil servant who led the investigation, said that “most of the well-publicised problems with core economic statistics are the consequence of ONS’s own performance”, especially “choices made at the top of ONS, over several years.” Acting National Statistician Emma Rourke said she welcomed the report and “fully acknowledges” the issues Sir Robert has highlighted.

City Minister Emma Reynolds has suggested that the Government could strip some of the Financial Ombudsman Service’s (FOS) powers as part of efforts to ease the regulatory burdens financial services firms face. She told an event organised by industry group TheCityUK that while the FOS “plays an important role in providing consumers and firms with straightforward, independent dispute resolution, which is critical … It should not act as a quasi-regulator.” The Government is considering transferring final decisions on consumer compensation to the Financial Conduct Authority through a new referral system. This could lead to a reduction in the FOS’s six-year complaint time limit and modifications to legislative obligations.

With the legal sector increasingly attracting private equity firms, it is noted that private equity has already been circling the professional services market, particularly firms with accountancy arms – with Apax snapping up Evelyn Partners’ accounting arm for £700m and the UK arm of Grant Thornton positioning itself for private equity backing.