Author: Glenn

Many businesses arrange insurance in the early days and then only look at it again when something changes, or when a renewal comes around. The difficulty with this approach is that risks evolve over time, and gaps in cover often only become visible when there is a claim. A short review with an insurance broker can help ensure that your policies reflect how the business currently operates and that protection remains adequate.

Business interruption

Business interruption cover is often misunderstood. It is designed to replace lost income while the business recovers from damage or disruption. The key issue is whether the indemnity period is long enough. If specialist equipment or premises are involved, recovery may take longer than expected. A broker can help evaluate assumptions and adjust cover accordingly.

Cyber risk

Cyber-attacks are now common across all sectors, not just large companies. Standard insurance policies rarely cover data breaches or ransomware incidents. Cyber insurance provides technical support as well as financial cover, which can make a major difference to recovery time.

Directors and officers

Directors and senior managers can face personal claims in relation to decisions they make. Reviewing Directors and Officers cover ensures that the right individuals are protected and that policy limits match the scale of business activity.

Supply chain and contractors

If contractors or suppliers are key to operations, it is worth checking who is responsible for what. Contracts should make insurance obligations clear, and your own policies should reflect any outsourced work.

Asset values and inflation

Rising costs mean many assets are now underinsured. Reassessing replacement values can prevent reduced payouts in the event of a claim.

A brief annual review can provide reassurance and avoid unwelcome surprises. If you would like support preparing for that conversation, we can help.

Taking on the role of a company director is more than holding a title. Directors have legal duties that shape how a company is run, how decisions are made and how risks are managed. These responsibilities exist to protect the business, its shareholders, employees and anyone who deals with the company. Even in a small or family run company, these duties are taken seriously and can have personal consequences if ignored.

Directors must act in the best interests of the company. This means making decisions that support the long term success of the business, rather than personal gain. It also means considering the interests of employees, customers, suppliers and the wider community where relevant. Directors are expected to use reasonable care, skill and judgement. If a director has particular expertise, such as finance or technical knowledge, a higher standard may be applied in those areas.

Financial oversight is a key responsibility. Directors must ensure that accounts are kept up to date, tax filings are made correctly and that the company is solvent. If the company begins to face financial difficulty, directors must take action early. Continuing to trade while knowing the company cannot meet its debts can lead to personal liability.

Directors must also avoid conflicts of interest. If a personal interest overlaps with a business decision, it must be declared. Transparency and good record keeping are essential.

Good governance is not about bureaucracy. It is about understanding the business and managing it responsibly. Regular board discussions, clear financial reporting and practical risk management go a long way to protecting both the company and its directors.

If you are thinking about selling a business or shares, it is important to understand how Business Asset Disposal Relief works, particularly with rates set to increase from April 2026.

Business Asset Disposal Relief (BADR) provides a valuable tax advantage, offering a reduced rate of Capital Gains Tax (CGT) on the sale of a business, shares in a trading company or an individual’s stake in a trading partnership.

The present rate of BADR is 14% for disposals made during the 2025-26 tax year. Currently, these rates are set to increase in the 2026-27 tax year starting on 6 April 2026 to 18%. As a result, disposals made after April 2026 will face a higher CGT rate.

These planned changes in the BADR rates can have a significant impact on tax planning for business owners and investors. Furthermore, it is worth noting that upcoming measures in the Autumn Budget could further diminish the benefits of these reliefs.

Despite these changes, the lifetime limit for claiming BADR currently remains at £1 million, which means that individuals can use the relief multiple times, provided their total gains from qualifying disposals do not exceed this threshold.

Changes have also been made to Investors’ Relief. As of 30 October 2024, the lifetime limit for Investors' Relief was reduced from £10 million to £1 million, with CGT rates now aligning with those for BADR at 14% and set to rise to 18% in April 2026.

If you are self-employed and your profits are above £12,570, you may need to pay Class 4 National Insurance, so it is important to understand how the rates and rules apply to you.

Self-employed individuals are usually required to pay Class 4 National Insurance contributions (NICs) if their annual profits exceed £12,570. These contributions are calculated based on profits and are used to fund various state benefits, including the state pension, unemployment benefits and the National Health Service (NHS).

For the current 2025-26 tax year, Class 4 NIC rates are set at 6% on profits between £12,570 and £50,270, with an additional 2% charged on profits above £50,270.

Certain groups are exempt from paying Class 4 NICs, including:

• Individuals under 16 at the start of the tax year.
• Individuals over State Pension age at the start of the tax year. If someone reaches State Pension age during the tax year, they remain liable for Class 4 NICs for the entire tax year.
• Trustees and guardians of incapacitated individuals are exempt from paying Class 4 NICs on that income.

The Class 4 NIC rate is lower than the corresponding rate for employees, who pay 8% on the same income levels. Both employees and the self-employed contribute 2% on income above the higher rate threshold.

The majority of individuals pay Class 4 National Insurance via self-assessment.

Recently, a clear legal precedent confirmed that the nature of an individual's work is determined by the reality of the actual employment relationship rather than by arbitrary titles. Mr. Gooch worked for the British Free Range Egg Producers Association (BFREPA) from 1 November 2011 until 26 April 2024, initially as a Policy Director on a "contracted services basis" for 2.5 days per week. The organisation, originally an unincorporated association, subsequently became an incorporated company in 2023 (BFREPA Ltd.), although the nature of its work was unaltered.

As Mr. Gooch's role evolved, so his compensation increased and, by 2016, he had effectively been promoted to Chief Executive of Services. Throughout his 12.5 years of engagement, he consistently submitted monthly invoices and was paid a retainer due to his self-employed status, without formally establishing a limited company. In February 2023, BFREPA's leadership expressed concern that their arrangement with Mr. Gooch looked remarkably similar to an employment relationship rather than a self-employed contract, even suggesting that the HMRC would likely classify him as an employee. As a consequence [of the evolving employment history of Mr. Gooch], in March 2023, BFREPA elected to give him 12 months' notice of termination, and he continued working until April 2024, at which point his email access was disabled, and he received a letter confirming that his contract would not be renewed. Mr. Gooch duly lodged claims against both defendants for unfair dismissal, unauthorised deductions from wages, unpaid holiday, wrongful dismissal for failure to pay statutory notice, and breach of contract relating to pension auto-enrolment. 

The Tribunal ruled that the claimant was a de facto employee, working under a contract of employment as defined by Section 230(1) of the Employment Rights Act 1996, Section 2 of the Working Time Regulations 1998, and Section 88(2) of the Pensions Act 2008. The Tribunal further concluded that personal service was a core requirement of the contract, one which contained no general substitution clause, and that the extent of the control was consistent with an employer-employee relationship for a senior employee alongside other strong indicators of a permanent employment relationship. The contracts also contained restrictive clauses that limited his ability to work for other companies in the same sector, a feature more commonly found in employment contracts than in contracts for service. 

This ruling provides a clear and detailed example of how a tribunal will look beyond the contractual terms to assess whether a person is an employee or a self-employed contractor. Employers cannot rely on a "contract for services" or a person's self-employed status to avoid the legal obligations of an employer. Instead, tribunals will scrutinise key factors such as the mutuality of the obligations, the degree of control, and the extent of integration in the business. Employers who treat long-term contractors like employees—providing them with a fixed monthly retainer, dictating their hours, and effectively integrating them into the business—risk having them reclassified as employees, and HR departments should ensure that contracts reflect the true nature of the relationship to avoid repercussions.