If businesses feel as though they are paying more tax than ever, there is a reason for that.
Author Archive: Muhammad Zia
The new Capital allowances are in full force: What do they mean for your business?
Capital allowances have had some big changes this year and they may affect how your business approaches investment, tax planning and cash flow management.
The reforms announced in the Autumn Budget 2025 introduced a new 40 per cent First Year Allowance (FYA) and a reduction in the Writing Down Allowance (WDA).
If your business is investing in equipment, machinery or leased assets, you need to understand what these changes mean so that you can avoid paying more tax than you need to.
What is the new First Year Allowance (FYA)?
Since 1 January 2026, companies have been able to claim a 40 per cent FYA on qualifying new and unused main-rate plant and machinery.
This relief has now been extended to sole traders and partnerships since 6 April 2026.
The relief allows 40 per cent of the asset’s cost to be deducted from taxable profits in the year of purchase.
The remaining 60 per cent is added to the main capital allowances pool and relieved over time through WDAs.
The new FYA is available to:
- Companies subject to Corporation Tax
- Sole traders
- Partnerships and LLPs
- Businesses purchasing qualifying assets for UK leasing
This is particularly important for unincorporated businesses, which cannot claim Full Expensing and leasing businesses that were previously excluded from upfront relief.
The qualifying assets usually include:
- Manufacturing and production machinery
- Office equipment and IT systems
- Fixtures and fittings
- Tools and trade equipment
- Certain leased plant and machinery
The allowance does not extend to cars, second-hand or used assets, special rate pool items and assets leased overseas.
How has the Writing Down Allowance (WDA) changed?
WDAs are known for spreading tax relief over several years by applying a percentage to the reducing balance of your capital allowance pool.
Since 1 April 2026 for companies and 6 April 2026 for unincorporated businesses, the main rate WDA has reduced from 18 per cent to 14 per cent.
This reduction means that businesses with existing main-rate pool balances will receive tax relief more slowly in future years.
As a result, some businesses could see higher taxable profits compared to previous years.
How could the Capital Allowance changes affect your business?
The new 40 per cent FYA increases the tax relief for qualifying new investments and can improve short-term cash flow for many businesses.
However, the lower WDA rate reduces the speed of relief on non-qualifying or historic expenditure.
Businesses that regularly invest in plant and machinery will need to carefully review:
- The timing of a purchase
- The type of assets being acquired
- Whether other reliefs are available
- The impact on future taxable profits
For example, companies may still be able to use Full Expensing or the £1 million Annual Investment Allowance (AIA) before claiming 40 per cent FYA.
Seeking early financial support can help you choose the correct relief and apply it in the right order.
Why is tax planning so important?
Your business needs to be proactive in its tax planning to help maximise the available relief and protect your cash flow.
You should be:
- Reviewing any planned capital expenditure
- Assessing the impact of the WDA on existing pools
- Reviewing if purchases should be accelerated or delayed
- Ensuring expenditure qualifies before committing funds
- Keeping documentation to support claims
With the right financial advice, your business can make informed investment decisions and make the most out of the available reliefs.
New payroll obligations: Annual leave and pay record-keeping from 6 April 2026
A significant but widely overlooked change took effect on 6 April 2026, placing new legal duties on all employers regarding how they record annual leave and pay.
Client spotlight: Coleman Classic Cars
Coleman Classic Cars was founded in 2021 as a Bristol car specialist by Mark Coleman.
He had been previously employed with Bristol Cars Limited, the manufacturer of Bristol cars, for more than 30 years and it felt like a natural progression to open his own specialist workshop in Maidenhead, Berkshire.
This company specialises in the Bristol marque of exquisite cars but does take on the servicing of other classic cars too.
His wife, Jemma, joined the business in 2025 to support Mark. She is involved in managing the business operations, allowing Mark to focus entirely on restoring these stunning classic vehicles.
Having previously worked in administration for a veterinary practice, this is a very different and exciting venture for Jemma and as running a business is a new experience for the husband-and-wife team, our experts at Rotherham Taylor have been a significant help.
Our team handle all of the essential background finance functions, allowing Mark and Jemma to manage daily operations effectively.
Michael and Lucy, two of our experienced accountants, have been instrumental from day one, while Natasha and Steph have also provided excellent support and are always available to answer any queries.
Speaking about her work with us, Jemma said: “I feel confident knowing the business accounts are in such good hands.”
Are you exempt from Making Tax Digital for Income Tax? HMRC clears up the confusion
Making Tax Digital (MTD) for Income Tax is in full swing, but there is still confusion in the air over who is exempt from these requirements.
How can you scale your business without harming your cash flow?
Whether you are expanding into new markets or launching new products or services, scaling your business is an exciting time.
However, scaling too quickly without careful financial planning can cause many profitable businesses to stall.
Poor cash flow management puts your business at risk and you must understand how to prepare your finances before scaling.
What is the cost of scaling your business?
Before you start taking the next steps to scale your business, you must assess the cost of growth.
Scaling comes with the obvious additional expenses for recruitment, stock, marketing and equipment.
However, it is often the hidden costs that can quickly add up, such as software, training and payroll taxes.
A detailed growth plan and budget can help you see exactly what resources are needed and when these costs will arise.
How do you forecast and monitor cash flow?
Cash flow forecasting is crucial when you are scaling your business.
You should monitor your profit and loss and expenses and conduct rolling forecasts, either weekly or monthly.
This can give you greater visibility over potential cash flow gaps before they become a problem.
Accounting tools, such as Xero, can streamline this process with real-time dashboards and automated reporting.
This can allow you to make informed decisions and adjust your strategy proactively.
How can you protect your cash flow?
Scaling can bring further costs and this can put pressure on your cash flow. To protect your cash flow, you should:
- Have clear payment processes – You need to invoice promptly, enforce clear terms and follow up consistently. To improve these processes, you can automate reminders or offer online payment options.
- Offer early-payment incentives or financing – Discounts for early payments or invoice financing can help bridge temporary gaps.
- Build a buffer – Cash reserves can protect you from unexpected costs, such as equipment failure or supplier delays and prevent disruption in your operations.
- External finance – Seeking external finance, such as debt or equity and investment can help support your business’s growth.
How can we help manage your cash flow?
When you plan carefully and monitor your cash flow, you can scale without putting your business at risk of liquidity or disruption.
Our experienced team can help you model the financial impact of growth on your cash flow and stress-test forecasts for different scenarios, such as delayed revenue or rising costs.
If you need further support or advice on how scaling affects your cash flow, contact us today.
Is now the perfect time to file your Self Assessment tax return?
HMRC has sent out a message to some of the 12 million people with Self Assessment tax accounts in the last week or so, alerting them to the need to file their next Self Assessment tax return.
Top 5 common probate mistakes – and how to avoid them
Probate is often assumed to be purely a legal process. In reality, it is just as much an accounting and tax exercise, involving valuations, inheritance tax calculations, compliance with HMRC deadlines and careful estate administration.
Below are five of the most common probate mistakes we have encountered and how an accountant‑led approach can help avoid them.
- Incorrect valuations submitted to HMRC
One of the most common probate errors is submitting inaccurate or poorly supported estate valuations, particularly for:
- Property
- Investment portfolios
- Business interests
- Loans, guarantees or overdrawn director accounts
Overvaluation of an estate can result in more Inheritance Tax being paid than necessary.
As probate practitioners, we ensure assets are valued at open market value at the date of death and can coordinate with independent valuation experts where required.
We can also reconcile figures back to bank, investment and business records, as well as prepare valuations that are robust and defensible in the event of HMRC compliance checks.
- Inheritance tax being overpaid or paid late
We regularly hear about estates where Inheritance Tax (IHT) reliefs and allowances are missed, including:
- Transferable nil‑rate bands from a pre‑deceased spouse or civil partner
- The residence nil‑rate band
- Business or Agricultural Property Relief
- Gifts and taper relief
Late payment of IHT is also common due to poor cashflow planning ahead of a person’s death.
An accountant experienced in probate will review the full history of the estate and any previous deaths related to it that may have a bearing on reliefs.
They will then identify and correctly claim all available allowances and reliefs and plan payment of IHT to avoid interest and penalties, where possible, including advising on instalment options where property or business assets are involved.
- Estate accounts prepared incorrectly
Many executors underestimate the importance of formal estate accounts, relying instead on informal spreadsheets that often do not reconcile to probate values or fail to distinguish between capital and income.
This can lead to disputes and challenges, particularly in more complex estates.
As part of probate administration, we, as accountants, will prepare:
- Full administration estate accounts
- Clear tracking of income, capital, and tax during the administration period
- Reconciliations from probate values through to final distributions
- Documentation suitable for beneficiaries and HMRC
Proper estate accounts provide transparency and reduce the risk of later disputes
- Distributing the estate before tax and liabilities are finalised
This is one of the most common mistakes made. Executors have been known to distribute assets too early, before HMRC has agreed the tax position, once all liabilities are known and clearance has been given.
This can be a costly error, as any further tax liabilities discovered or if beneficiary claims are made, executors can be personally liable.
When we advise executors on the probate process, we ensure that they retain appropriate reserves for tax, costs and contingencies.
We can also:
- Help them understand when interim distributions may be made safely
- Obtain HMRC clearances where appropriate
- Support them so that they do not breach their fiduciary responsibilities
- Executors underestimating their responsibilities
As we have pointed out, being made an executor comes with many responsibilities and personal liabilities that many people do not fully appreciate.
We are often approached only once problems arise. Instead, as licensed probate professionals, we can act as executors for the estate or take on the probate role entirely.
This includes dealing with HMRC directly, thereby reducing the administrative and emotional burden on families.
Using professional support is a sensible risk‑management decision, not an admission of difficulty.
Here to help
As accountants authorised to carry out probate work, we are well-placed to manage the financial, tax and administrative aspects of a deceased estate, either independently or alongside legal advisers where required.
If you are acting as an executor or dealing with an estate, seeking professional advice early can make a significant difference, so speak to our team.
App of the Month: Syft
In our latest app of the month feature, we are taking a look at Syft Analytics.
This is a cloud-based reporting platform that integrates effortlessly with many existing cloud accounting software like Xero, allowing users to generate automated, professional management reports in real-time with minimal effort.
Syft offers businesses faster, more insightful financial reporting, whilst also saving you time and reducing errors in your analysis.
Why do many businesses choose Syft?
- Automated data imports and report generation – Eliminate the hassle of manual data entry and reduce errors often found in spreadsheets.
- Real-time reporting – Get instant access to updated reports without the need for time-consuming exports.
- Tailored to your needs – Custom reporting packs, advanced analytics and insights that go beyond traditional Excel reports.
- Clear, professional reports – Get easy-to-understand reports that help you track performance and spot trends without the need to interpret raw data or complex spreadsheets.
- Save time – No more exporting data or reformatting spreadsheets. Syft automates the entire reporting process, allowing you to focus on running your business.
- Seamless integration – Syft works effortlessly with Xero and other accounting software, syncing all your financial data in real-time.
- Advanced analytics – Gain deeper insights with tailored reporting packs, adding additional graphs and commentary to improve your decision-making.
With a quick and easy setup, Syft Analytics enables you to deliver more accurate, insightful and professional reports to your stakeholders.
Whether you’re a small business or a growing enterprise, Syft empowers you to stay ahead by providing the tools you need to monitor and manage your business more effectively.
Want to implement Syft in your business?
Syft is one of a number of platforms that we can help businesses to implement. If you want to learn how Syft Analytics can transform your reporting and give you the tools to make data-driven decisions faster, speak to our team.
Health screenings – A tax-efficient employee benefit
Many employers are on the lookout for new means to attract talent to their business in an increasingly competitive labour market, but many aren’t aware of annual health screenings and their tax-efficient benefits.
