Finance Act 2025

The complete text of Finance Act 2025 with every section annotated and explained. A must-have for every accountant and tax practitioner.

Content

• Introductory Text
• Part 1 Income tax, capital gains tax and corporate taxes
  • Income tax charge, rates etc
  • 1. Income tax charge for tax year 2025-26
  • 2. Main rates of income tax for tax year 2025-26
  • 3. Default and savings rates of income tax for tax year 2025-26
  • 4. Freezing starting rate limit for savings for tax year 2025-26
  • Income tax provisions relating to cars
  • 5. Appropriate percentage for cars: tax year 2028-29
  • 6. Appropriate percentage for cars: subsequent tax years
  • Capital gains tax rates and reliefs
  • 7. Main rates of CGT for gains other than carried interest gains
  • 8. Business asset disposal relief: increase in rate
  • 9. Investors’ relief: increase in rate
  • 10. Investors’ relief: reduction in amount qualifying for relief
  • 11. Sections 7 to 10: transitional provision
  • 12. Rate of CGT for carried interest gains
  • Corporation tax charge and rates
  • 13. Charge and main rate for financial year 2026
  • 14. Standard small profits rate and fraction for financial year 2026
  • Oil and gas
  • 15. Increase in rate of energy (oil and gas) profits levy
  • 16. Relief from levy for investment expenditure
  • 17. Extending the period for which levy has effect
  • 18. Decommissioning of carbon storage installations
  • International matters
  • 19. Pillar Two
  • 20. Offshore receipts in respect of intangible property
  • 21. Application of PAYE in relation to internationally mobile employees etc.
  • 22. Advance pricing agreements: indirect participation in financing cases
  • Reliefs for businesses
  • 23. Expenditure on zero-emission cars
  • 24. Expenditure on plant or machinery for electric vehicle charging point
  • 25. Commercial letting of furnished holiday accommodation
  • 26. Films and television programmes: increased relief for visual effects
  • 27. Certification of films etc: minor amendments
  • 28. Films etc: unpaid amounts
  • 29. Research and development relief: Northern Ireland companies
  • 30. Research and development intensity condition: transitional provision
  • Employee-ownership trusts
  • 31. Employee-ownership trusts
  • Miscellaneous measures
  • 32. Overseas transfer charge: pension schemes in EEA state or Gibraltar
  • 33. Overseas pension schemes established in EEA states
  • 34. Pension scheme administrators required to be resident in United Kingdom
  • 35. Alternative finance: diminishing shared ownership refinancing arrangements
  • 36. Statutory neonatal care pay
• Part 2 Replacement of special rules relating to domicile
  • Chapter 1 New rules for foreign income and gains of individuals becoming UK resident
  • 37. Claim for relief on foreign income
  • 38. Claim for relief on foreign employment income
  • 39. Claim for relief on foreign gains
  • Chapter 2 Ending the special treatment of individuals not domiciled in United Kingdom
  • 40. Remittance basis not available after tax year 2024-25
  • 41. Temporary repatriation facility
  • 42. Rebasing of assets
  • Chapter 3 Trusts etc
  • 43. Trusts: connected amendments, transitional provision etc
  • Chapter 4 Inheritance tax
  • 44. Excluded property: domicile test replaced with long-term residence test
  • 45. Corresponding change for settled property
  • 46. Consequential, connected and transitional provision
• Part 3 Other taxes
  • Value added tax
  • 47. Removal of exemption for private school fees
  • 48. Charge on pre-paid private school fees
  • 49. Sections 47 and 48: commencement
  • Stamp duty land tax
  • 50. Increased rates for additional dwellings: transactions before 1 April 2025
  • 51. Increased rates for additional dwellings: transactions on or after 1 April 2025
  • 52. Contracts substantially performed before relevant rate change
  • 53. Purchases by companies etc
  • Annual tax on enveloped dwellings
  • 54. Alternative finance: land in England, Scotland or Northern Ireland
  • 55. Alternative finance: land in Wales
  • Stamp duty and stamp duty reserve tax
  • 56. Testing of FMI technologies or practices
  • Inheritance tax
  • 57. Rate bands etc for tax years 2028-29 and 2029-30
  • 58. EBTs: prohibition on applying property for benefit of participators etc
  • 59. EBTs: restriction on proportion of beneficiaries who may be participators etc
  • 60. EBTs: shares entering trust to have been held for two years
  • 61. Agricultural property relief: environmental management agreements
  • 62. National Savings Bank: statements from HMRC no longer to be required
  • Alcohol duty
  • 63. Rates of alcohol duty
  • 64. Abolition of duty stamps for alcoholic products
  • Tobacco products duty
  • 65. Rates of tobacco products duty
  • Taxes relating to vehicles
  • 66. Rates of vehicle excise duty for light passenger or light goods vehicles etc
  • 67. Rates of vehicle excise duty for rigid goods vehicles without trailers etc
  • 68. Rates of vehicle excise duty for rigid goods vehicles with trailers
  • 69. Vehicle excise duty for vehicles with exceptional loads etc
  • 70. Rate of vehicle excise duty for haulage vehicles other than showman’s vehicles
  • 71. Vehicle excise duty: zero-emission vehicles
  • 72. Rates of HGV road user levy
  • 73. Rates of air passenger duty until 1 April 2026
  • 74. Rates of air passenger duty from 1 April 2026
  • Environmental taxes
  • 75. Rates of climate change levy
  • 76. Rates of landfill tax
  • 77. Rate of aggregates levy
  • 78. Rate of plastic packaging tax
  • Soft drinks industry levy
  • 79. Rates of soft drinks industry levy
• Part 4 Miscellaneous and final
  • Avoidance
  • 80. Limited liability partnerships
  • 81. Loans to participators
  • Crypto-asset reporting framework
  • 82. OECD crypto-asset reporting framework
  • Preparing for new taxes and information sharing
  • 83. Duty on vaping products
  • 84. Carbon border adjustment mechanism
  • Wrong cross-reference etc
  • 85. Correction of wrong cross-reference etc
  • Final
  • 86. Interpretation
  • 87. Short title
• Schedules
  • Schedule 1 Consequential provision in connection with section 7
  • Schedule 2 Sections 7 to 10 : transitional provision
  • Schedule 3 Payments into decommissioning funds
  • Schedule 4 Pillar two
  • Schedule 5 Furnished holiday lettings
  • Schedule 6 Employee-ownership trusts
  • Schedule 7 Diminishing shared ownership refinancing arrangements
  • Schedule 8 Relief on foreign employment income: consequential and transitional provision
  • Schedule 9 Income tax and capital gains tax: remittance basis and domicile
  • Schedule 10 Temporary repatriation facility
  • Schedule 11 Rebasing of assets
  • Schedule 12 Trusts: connected amendments, transitional provision etc
  • Schedule 13 Inheritance tax

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