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Pensions remain one of the most tax efficient ways to save for the future, and thoughtful planning around contributions continues to be one of the most effective tax planning tools available. However, recent changes announced in the Autumn Budget, alongside upcoming reforms to the Inheritance Tax treatment of unused pension funds, highlight the importance of reviewing retirement planning sooner rather than later. Below, we outline the key changes and what they may mean for individuals and business owners. Salary sacrifice changes From 6 April 2029, full tax-free salary sacrifice for pension contributions is due to be restricted. A new £2,000 limit will apply to the amount employees can contribute through salary sacrifice without incurring Income Tax and National Insurance contributions (NICs). This change will affect pension schemes operated by UK employers. Around eight million employees currently use salary sacrifice to fund pension contributions, with over three million sacrificing more than £2,000 of salary or bonuses each year. For many, this change could significantly alter the tax efficiency of their retirement savings strategy. Why the government is making changes The government has stated that it continues to support and incentivise pension saving, retaining Income Tax and NICs reliefs on pension contributions worth more than £70 billion annually. Most other salary sacrifice arrangements were closed in 2017. Pension salary sacrifice remained in place, but its cost has risen sharply. Forgone NICs increased from £2.8 billion in 2016/17 to £5.8 billion in 2023/24, and without intervention this figure was forecast to rise to almost £8 billion by 2030/31. Pension contribution rules explained Individuals receive tax relief on pension contributions at their marginal rate. Relief is available in each tax year on contributions up to the higher of: 100% of net relevant earnings £3,600 gross However, there are limits on how much can be contributed tax efficiently. The annual allowance caps the total amount of pension saving that can receive tax relief each year. For the 2025/26 tax year, the annual allowance remains at £60,000. Contributions above this level may trigger a tax charge. Reduced allowance for higher earners For higher earners, a tapered annual allowance may apply. This affects individuals with: Threshold income above £200,000 Adjusted income above £260,000 Where adjusted income exceeds £260,000, the annual allowance is reduced by £1 for every £2 over this limit, down to a minimum of £10,000 once adjusted income reaches £360,000. Using unused allowances from earlier years Unused annual allowance can be carried forward for up to three tax years. This can be particularly helpful for individuals with fluctuating income, or owner-managed businesses where profits vary year to year. For the 2025/26 tax year, unused allowances from 2022/23, 2023/24 and 2024/25 can be carried forward, provided the individual was a member of a registered pension scheme in those years. It is worth noting that the annual allowance for 2022/23 was £40,000, lower than the current limit. Keeping track of pension savings It is surprisingly common for people to lose track of their pension savings over time. Current estimates suggest there are around 3.3 million lost pension pots in the UK, holding a combined £31.1 billion. The average lost pot is largest among those aged 55 to 75, at approximately £13,500. Many pension providers offer tracing and consolidation services, and the government’s Pension Tracing Service can also help individuals locate missing pensions. Looking ahead, the planned pensions dashboard aims to provide a secure, online view of all pension savings in one place. While there is no confirmed public launch date yet, it is expected to make managing pensions far simpler in future. Talk to us Pension rules can be complicated and changes often have a significant impact on your long-term tax position. Whether you are employed, self-employed or running your own business, getting the right advice can help ensure your pension strategy remains tax efficient. If you would like to review your pension planning or understand how these changes may affect you, call us on 01904 787 973 or book a call with our team .

Recent figures from the Office for National Statistics suggest that wage growth in the UK is beginning to ease. Between September and November, average pay growth slowed to 4.5%, with private sector wage increases falling to their lowest rate in five years. At the same time, the number of people on company payrolls dropped by 135,000, with retail and hospitality seeing some of the sharpest declines. On the surface, this might sound like dry economic data. But beneath the headlines, there are some very real implications for business owners. A slowdown that feels counterintuitive For many employers, particularly those who have struggled to recruit and retain staff over the past few years, the idea that slower wage growth could be “good news” feels odd. After all, rising wages usually mean happier staff and lower turnover. But from a wider economic perspective, slower wage growth reduces pressure on inflation. When wages rise quickly, people tend to spend more, pushing prices up. That is one of the reasons the Bank of England has kept interest rates high. With wage growth easing and inflation falling slightly, economists believe this increases the likelihood of interest rate cuts later this year. That matters for businesses because interest rates affect borrowing costs, cash flow, and confidence. Why private sector businesses are feeling the pinch The data also highlights a growing gap between public and private sector pay. Public sector wages rose by nearly 8%, while private sector pay grew at closer to 3.6%. For private businesses, this reflects a tougher trading environment. Costs remain high, consumer spending is under pressure, and many businesses are being more cautious about hiring. The fall in payroll numbers, even heading into the Christmas period when hiring is usually stronger, suggests businesses are choosing to do more with less. This is not necessarily a sign of panic, but it does point to a period of consolidation rather than expansion. What business owners should take from this For business owners, this data is not something to worry about, but it is something to be aware of. A few practical points to consider: Wage planning needs to be realistic. Automatic annual pay rises may not be sustainable in the current climate. Any increases should be tied to affordability, productivity, and long-term plans. Cash flow matters more than ever. Slower growth and higher borrowing costs mean keeping a close eye on forecasts, reserves, and commitments. Hiring decisions deserve scrutiny. Bringing someone on board is a long-term cost, not just a monthly wage. It is sensible to review whether roles are essential now or can wait. Interest rate changes could help later. While rates are expected to hold in the short term, the direction of travel may start to ease pressure on loans and finance later in the year. Staff communication is key. If pay rises are smaller or delayed, being open and honest helps maintain trust and morale. A reminder about context Economic headlines rarely tell the full story on their own. Slowing wage growth does not mean wages are falling, nor does it mean businesses should stop investing in their teams. What it does mean is that the post-pandemic surge in pay and demand is settling, and businesses are entering a more measured phase. Understanding that context helps owners make better decisions rather than reacting to headlines alone. How we can help At Inglis, we work with businesses to make sense of changes like these and understand what they mean in practice. If you would like help reviewing your payroll costs, planning pay increases, or sense-checking decisions around hiring and cash flow, we are always happy to talk things through. You can call us on 01904 787 973 or book a call with our team .

Social media seems, once again, to be ablaze with the famous question: How many r’s are in strawberry? It is one of those prompts that reliably resurfaces every few months, usually accompanied by screenshots of ChatGPT confidently giving the wrong answer. On the surface, it is a harmless curiosity. A bit of fun. But it also reveals something far more important about how AI works, and where its limitations still sit. It often looks like modern AI can accomplish any task. Want a fun marketing image? Easy. Need a blog post written? Done. Want to use AI to create a romantic song for your wedding anniversary? You’ll have it in seconds. Yet despite how magically the technology seems, AI still falls surprisingly flat when it comes to certain basic tasks. Tasks you would expect a seven-year-old to achieve with ease. It is amusing, and slightly baffling, to see ChatGPT struggle with something as simple as counting letters in a word. But it is not just ChatGPT being glitchy or careless. There are structural reasons why large language models struggle with certain words more than others. Take the question itself: how many r’s are there in the word strawberry? For most people, the answer is immediate. You picture the word, scan it, and count. Three. For ChatGPT, the process is completely different. It does not “see” words as letters in sequence. It predicts likely outputs based on patterns it has learned from enormous volumes of text. When asked, what answer does it give? Just a clear and confident: “two.” So, for all the billions in investment, the vast computing power, the pressure on global energy and water resources, and the near-mythical reputation AI now carries, it still cannot reliably answer how many r’s are in strawberry. That should give anyone pause before using AI for things that really matter. Why this matters for tax, finance, and professional advice The strawberry example is trivial, but the underlying issue is not. AI systems are designed to produce plausible responses, not guaranteed correct ones. When they get things wrong, they often do so with complete confidence. That is a dangerous combination in areas like tax, accounting, and compliance. With self-assessment deadlines approaching, it is tempting for business owners to ask AI questions such as: Can I claim this expense? Do I need to register for VAT? How should I structure my income to be more tax-efficient? AI can produce an answer quickly, and it will often sound reasonable. The problem is that it may be outdated, oversimplified, or simply incorrect for your specific circumstances. UK tax law is nuanced, highly contextual, and frequently updated. AI does not understand your full financial picture unless you give it every detail, and even then, it cannot apply professional judgement in the way a qualified adviser can. The same risk applies when using AI for business communications or financial decisions. Using AI to draft explanations, summaries, or documents without proper review can introduce subtle errors. A missed exception, a misquoted threshold, or an outdated allowance can all undermine confidence and potentially create problems later. Using AI safely and sensibly in practice AI is not useless. Far from it. But it needs to be used with care and clear boundaries. Here are a few practical guidelines help reduce risk: Treat AI as a starting point, not a final answer. It can help you think, outline, or draft, but it should never be the last word on technical matters. Always verify facts against authoritative sources, such as HMRC guidance, legislation, or professional manuals. Do not rely on AI for personalised tax advice. Review anything important before acting on it. If you would not be comfortable explaining it to HMRC, it should not be based on an unchecked AI response. Be especially cautious with deadlines, thresholds, and eligibility criteria. These are areas where AI errors are common and costly. AI can save time, spark ideas, and help with structure and clarity. What it cannot do, at least not yet, is replace professional judgement, accountability, or detailed technical understanding. If it can confidently miscount the letters in strawberry, it can just as confidently misstate a tax rule. The difference is that one is a joke on social media, and the other can have real financial consequences. How we can help At Inglis, we support individuals and businesses with clear, practical accounting advice you can rely on. We understand that tools like AI can be useful, but when it comes to tax, compliance, and financial decisions, having a trusted adviser still matters. If you would like a second opinion on a tax question, help making sense of your numbers, or reassurance that you are doing the right thing, we are always happy to talk things through. You can call us on 01904 787 973 or book a call with our team .

The new year is often when most of us step back and think about what we want the next 12 months to look like. Perhaps it's more profit, fewer late nights catching up on work, improved systems, or simply a business that feels easier to manage. The real challenge, however, isn't usually a shortage of ideas. It's that many goals are structured in a way that makes them difficult to sustain when the everyday demands of work return. That's why we wanted to share our five-step approach to setting business goals, one that emphasises follow-through as much as it does the initial spark of ambition. Step 1: Pick one goal that genuinely moves the business forward Trying to fix everything at once usually leads to fixing nothing. We often see business owners commit to growth, cost control, new software, marketing and hiring all at the same time. Instead, choose the one outcome that would make the biggest difference this year. That might be improving cash flow stability, increasing margins, or freeing up more of your own time. This becomes the priority that decisions are tested against. Other improvements can sit behind it, but they do not compete for attention. Step 2: Set a goal that stretches you, but still fits reality A goal needs enough ambition to hold your focus beyond January. If it is too easy, it will be deprioritised. If it is unrealistic, it will be abandoned. The best goals sit in the middle. Challenging, but grounded in the reality of your current numbers, capacity and market conditions. This is where clear financial information adds real value, rather than relying on instinct alone. Step 3: Convert the goal into specific, scheduled actions High-level goals only work when they are translated into what actually happens week to week.  Be clear on the actions that drive the outcome. For many businesses, this might mean reviewing pricing, assessing which customers or services are genuinely profitable, tightening processes, or stepping away from work that absorbs time without delivering a fair return. These tasks require scheduling, not just a fleeting note jotted down on New Year's Day. Block out time in your calendar and treat it with the same seriousness as a client commitment. Progress often grinds to a halt when you simply wait for free time to appear. Step 4: Use focus tools that work in real life Motivation is not constant. The most productive business owners design their environment to support focus rather than relying on willpower. A few tools that genuinely help: Visual reminders can help, but only if they change. A note stuck on the mirror or desk might catch your attention for a few days, then it quickly becomes part of the background. If you use prompts, refresh them regularly and move them around. The aim is to create a nudge you actually notice, not something you automatically ignore. When you're working, keep your phone out of reach or switch it to aeroplane mode. Both task-switching and procrastination can seriously cut into your productivity. Task-switching happens when you check your phone during work sessions, and procrastination is when you get distracted by your phone just before you begin a task. Work in defined time blocks, then deliberately switch off afterwards. This helps maintain energy across the week. Tip: Relax your gaze and look off to the horizon when you finish working. This “turns off” the release of chemicals associated with alertness and will aid in relaxation. If motivation dips, briefly remind yourself what not achieving the goal would mean for the business. Avoiding a negative outcome is often a stronger driver than chasing a positive one. Step 5: Plan for the middle, not just the start and finish Most goals fail in the middle phase. The initial excitement has passed, and the finish line feels distant. This is normal. The solution is to break the overall timeframe into smaller segments and acknowledge progress along the way. We find that random, occasional rewards often work better than constant ones. They keep the energy up without making things feel stale. Equally, do not feel the need to broadcast goals too early. Early praise can replace the sense of achievement that should come from actual results. How we can help As accountants, we are naturally focused on numbers, but those numbers tell a story about where a business is being held back and where effort will have the biggest impact. If you want a second opinion on your goals, help working out what is realistic financially, or just a chance to talk things through with someone who understands your business, we’re always happy to help. Feel free to give us a call 01904 787 973 or book a call with Donald Inglis .

The introduction of Making Tax Digital for Income Tax (MTD for IT) is approaching quickly. From April 2026, individuals with qualifying income over £50,000 will be required to comply with the new rules. It is important to understand whether you are affected and what steps you should be taking now to prepare. Qualifying income For the first phase of MTD for IT, the mandated income sources are self-employment (for those not in a partnership) and property income, including income from overseas property. Individuals will be legally required to use MTD for IT from the following dates: April 2026 if qualifying income exceeds £50,000 in the 2024/25 tax year April 2027 if qualifying income exceeds £30,000 in the 2025/26 tax year April 2028 if qualifying income exceeds £20,000 in the 2026/27 tax year How does MTD apply? HMRC research indicates that many taxpayers remain unsure about how MTD applies to them in practice. The core requirement is to keep and preserve specific accounting records in a prescribed digital format and submit information to HMRC digitally. MTD does not require receipts or invoices to be scanned and stored digitally, as was initially proposed. Instead, it focuses on how records are maintained and how information is submitted. Taxpayers must use functionally compatible software to meet the record-keeping requirements. This software must be capable of linking directly with HMRC systems, which involves an authorisation process at the outset and a renewal every 18 months. A key principle of MTD is the requirement for an uninterrupted digital journey. Information must flow from the accounting records through to submission to HMRC without manual re-entry. Spreadsheets can still be used as part of the process, provided that the software used to consolidate or submit the data is fully digital and meets HMRC’s requirements. The penalty regime Taxpayers joining MTD for IT in April 2026 will not face penalties for late submission of quarterly updates during the initial transition period. In the Autumn Budget 2025 documents, the government confirmed that no penalty points will be charged for missed quarterly updates during the 2026/27 tax year. As a result, those earning non-PAYE income over £50,000 will not be subject to the new MTD penalty regime until April 2027. From 6 April 2027, the new penalty regime for late submission and late payment will apply to all income tax taxpayers within MTD. This regime operates on a points-based system, targeting persistent non-compliance. Each missed annual submission will result in a penalty point. Once a taxpayer reaches the threshold of two points for late submission of their final declaration, a fixed financial penalty of £200 will be charged. Need help preparing for MTD? If you are unsure whether MTD for Income Tax applies to you, or you would like support in preparing your systems and records, we can help. Early planning can make the transition far smoother and help you avoid unnecessary issues once the rules come into force. To discuss your situation or to get advice, please contact us on 01904 787 973 or book a call with Donald Inglis .

Customer service has changed. We now have multiple options for automating our customer interactions or offering self-service options to our customer base. Customers can talk directly to AI agents or sort out a query with an automated chatbot. It’s fast, efficient and (from your viewpoint as an employer) highly cost-effective. But is automated customer service always the best option? In an environment where your customers are surrounded by digital interactions, wouldn’t it be nice to offer a more human and personalised level of customer service? And does that mean hiring more staff? Fundamentally, customers are still seeking out the human element of customer service, amongst the sea of digital and online noise that we’re now surrounded by daily. There are three core reasons why customers crave this more personal touch: Trust and empathy: When dealing with complex or emotionally charged issues (like financial errors or faulty products), customers want to talk to a human agent who can demonstrate empathy and take ownership of the problem. Chatbots may be efficient, but they don’t deliver when it comes to customer empathy. Context and recognition: Old-fashioned service means being recognised and having your history remembered. Customers expect the business to know their needs, history and preferences without forcing them to repeat this information. A human agent with access to a CRM system can deliver this recognition in a personalised and tailored way. A need for exceptional service: A recent Australian survey found that 88% of consumers expressed satisfaction with customer service interactions that were managed mostly or fully by human agents. When customers have a good experience with a human agent, this increases their brand advocacy and can also generate positive word-of-mouth referrals (one of the best ways to attract new customers). The impact of human-led customer service can be immense. AI agents and software automation can boost your overall efficiency for many simple tasks and customer interactions. But having the human touch drives customer loyalty, retention and your competitive advantage. Hiring more customer service staff (and investing in their training) could be a way to find your own competitive advantage as a business. If you want to talk through your people strategy, book a call with Donald Inglis .

The average business owner needs an additional four hours in their working day to complete their admin, according to research by OnePoll. If your people are spending 20 hours per week wading through tedious and unproductive admin, that’s bad for the business and for your efficiency. Fortunately, technology and software automation can go a long way towards automating these low-level admin tasks. Better productivity through automation Automation is an important way to ease your business workload, with a host of different business apps and cloud solutions offering ways to automate your admin. With ‘smart business tools’ increasing in number and choice, software is utilising automation algorithms, AI, machine learning and cognitive solutions to help remove the mundane admin tasks from your workflows. Core processes that will benefit from automation include: Automated bookkeeping – Simply take a photo of your receipts, expenses and invoices and ‘optical character recognition’ technology will digitise the output and pull it through to your accounts software. No data entry, no human error and no lost receipts! We can do the rest to ensure your records are accurate. Automated credit control – chasing up debts and late-paying customers takes time. Automated credit control apps track your debtor numbers and automatically sends out customised chaser emails as soon as an invoice is late. This reduces your credit control time, speeds up cash collection and cuts your aged debtor figure. Automated payment collection – the easier it is to pay you, the faster your customers will pay. Automated card payments and cloud-based Direct Debit solutions allow you to automatically take payment from a customer as soon as an invoice is due. Some solutions will even automate the invoice matching and bank reconciliation process. Automated reporting and forecasting – the better your reporting and business intelligence, the easier it is to make informed decisions about your company strategy. Accounting platforms and fintech tools now offer automatic, real-time reporting and forecasting, giving you access to the important numbers and metrics, fast. Automated digital marketing – digital marketing is key to raising your brand’s profile. Marketing platforms offer important time-saving ways to create, schedule and post social media content, or email automations to send a pre-programmed cadence of emails to specific target audiences within your wider customer base. Talk to us about embracing the power of automation If your admin is holding you back, talk to us about how automation can pick up some of the heavy lifting as well as giving you the metrics you need for decision making. We can review your business processes and identify the automation opportunities, helping you choose the best apps to drive your business efficiently.

Are you heading away for a break from the business this year? This time of year can be hard on small business. Your expenses continue and your cash flow can suffer when your debtors go on holiday. Leading up to the Christmas period, is your business cash flow in good health to carry you through? With a bit of pre-planning and being proactive, you can set yourself up for a financially stress-free holiday. Planning your cash-flow over Christmas Invoice early – Send any invoices that you can, and in advance if possible. Perhaps consider whether you have any regular clients or customers that you could offer a retainer or similar deal to if they book services or make a purchase from you in advance. Chase payment – Use this opportunity to chase up any outstanding payments. Strong communication and relationships matter, so talk to clients and chase invoices. Talk to suppliers – A little honesty can go a long way. Perhaps they can extend a line of credit for your payments to them. In most cases, a good supplier would rather offer a little flexibility to keep an ongoing business relationship. Review your costs – Make sure you have a clear picture of your payroll, and any other planned expenses that will need to be accounted for. It’s also a good idea to do a general review of expenses. Business costs can creep up, and it’s a great idea to make a time to check on your expenses regularly, no matter what your financial situation. Review all of your regular payments and subscriptions as well as upcoming costs. There may be travel, functions or purchases which you can decide on an alternative approach to. Talk to the bank or tax department – If cash flow is tight, make sure you have conversations early so you have everything in place to see you through. We understand the Christmas period can be a financial strain, and we're here to help you manage it. Our goal is to ease your cash flow concerns, allowing you to truly relax. When you’re planning for a break, arrange a meeting with Donald Inglis .