Author: Glenn

The UK Government has unveiled a landmark plan to reduce electricity network charges for the country’s most energy intensive industries, such as steel, ceramics, glass and chemicals, slashing costs by up to 90% from 2026.

What is changing?

The current 60% rebate under the Network Charging Compensation (NCC) scheme will rise to 90%, delivering savings of approximately £7 per megawatt hour for around 500 qualifying firms. Annual savings are projected at up to £420 million once fully in effect, bringing energy costs more closely into line with European competitors.

Context and strategy

This initiative forms part of the Government’s broader Modern Industrial Strategy and British Industry Supercharger package, introduced to strengthen competitiveness and support domestic manufacturing. A four week public consultation has been launched on the uplift and related reforms, including a proposal to double the NCC application window from one to two months.

Why this matters

By reducing energy overheads, the plan aims to boost investment, protect jobs, and help UK heavy industry stay globally competitive. Government estimates indicate that UK manufacturing has now recovered to pre pandemic levels, supported by approximately 12,000 new jobs in the year to March 2024.

Complementary measures

The announcement follows recent confirmation of the British Industrial Competitiveness Scheme, due to launch in 2027. This scheme will cut broader electricity bills by up to 25% for over 7,000 manufacturers, primarily by exempting them from green levies. A new Connections Accelerator Service will also streamline grid connections by the end of 2025, while upcoming legislation will grant powers to reserve grid capacity for strategic infrastructure.

Industry response

Business groups, including representatives from the steel sector, have welcomed the changes as a timely and necessary move to secure a competitive future for UK manufacturing.

UK Export Finance (UKEF) is the UK’s export credit agency and government-backed financier. Its mission is to ensure that no viable UK export fails simply due to lack of funding or insurance.

What UKEF offers

• Working capital support: Through schemes such as the General Export Facility, Export Working Capital Scheme, and Export Development Guarantee, UKEF backs loans that help UK businesses fulfil multiple export contracts or build up stock and capacity. Loans of up to £25 million are available, typically delivered through participating lenders.
• Bond protection: UKEF supports performance bonds and advance payment guarantees through its Bond Support Scheme and Bond Insurance Policy. This enables exporters to meet buyer demands without tying up excessive working capital, as banks are more willing to issue bonds when UKEF shares the risk.
• Export insurance: UKEF insures against risks that private insurers may be unwilling to cover. This includes non-payment by overseas buyers and political risks in certain markets. Cover is available for up to 95% of the contract value, giving exporters confidence to sell to new or emerging markets.
• Buyer finance and direct lending: UKEF can finance overseas buyers of UK goods and services through its Buyer Credit Facility and Direct Lending Facility. These allow foreign governments or companies to access competitive finance terms when purchasing from UK suppliers, especially for infrastructure and capital projects.
• Expert guidance: UKEF’s nationwide network of Export Finance Managers offers free, impartial advice to UK businesses. They help firms assess eligibility, navigate applications, and manage risk more effectively.

Why it matters

UKEF removes many of the common financial barriers that prevent UK firms from exporting. By providing financial backing, guarantees, and insurance, it helps businesses of all sizes grow through international trade.

New UK transfer pricing rules could mean more reporting and fewer exemptions for mid-sized businesses. The government is consulting on proposals to tighten compliance and align with global standards. One key change would remove the transfer pricing exemption for medium-sized enterprises, keeping it only for small businesses. Another would introduce a new reporting requirement, the International Controlled Transactions Schedule (ICTS), to give HMRC more visibility over cross-border related-party transactions. These reforms aim to curb profit shifting, protect the UK tax base and simplify the rules for those who follow them.

Transfer pricing refers to how prices are set for transactions between companies that are part of the same group, especially when these transactions cross international borders. These prices must follow the “arm’s length principle,” meaning they should reflect what unrelated companies would charge under similar circumstances. This helps ensure that profits are taxed fairly where economic activity actually takes place.

The UK government is seeking feedback on two proposed changes to its transfer pricing rules. These proposals aim to protect the UK’s tax base from multinational enterprises (MNEs) shifting profits overseas, and to bring the UK in line with global best practices.

The first proposal suggests changing the current exemption from transfer pricing rules for small and medium-sized businesses (SMEs). In particular, it proposes removing the exemption for medium-sized enterprises but keeping it for small ones. The government also wants to update definitions and thresholds to make the rules clearer and easier to follow.

The second proposal would introduce a new reporting requirement called the International Controlled Transactions Schedule (ICTS). This would require MNEs to report cross-border related-party transactions to HMRC. The information would help HMRC better assess risk, reduce audit times, and support fairer, more efficient tax compliance whilst at the same time limiting extra burdens on businesses.

Need to help a relative or friend with tax? HMRC’s Trusted Helper service makes it quick and easy to support someone online. Whether it is checking Income Tax, updating their personal details or reviewing taxable benefits like company cars or medical insurance, you can do it all with their permission. After registering as a trusted helper, your friend or family member simply needs to approve your access. You can help up to five people, but remember, they remain responsible for their own tax affairs.

This online option allows you to support someone, such as a friend or relative with key tax tasks, such as checking their Income Tax, updating their personal tax account or reviewing their taxable benefits (limited to company cars and medical insurance).

To get started, you must register online as a trusted helper. Once you have signed up, the person you are helping will need to log in and approve your request. If they cannot go online, you can call HMRC on their behalf, but they must be physically present with you during the call. HMRC will confirm their identity and their consent before proceeding. You will also need their National Insurance or tax reference number.

You can help up to five people using this service. While you can assist with their tax matters the person you are helping remains legally responsible for their own tax affairs. You must sign in using your Government Gateway details, and you may be asked to verify your identity using photo ID such as a passport or driving licence.

HMRC also offers this service in Welsh and provides additional support for those with disabilities or non-English speakers.

Making Tax Digital for Income Tax will become mandatory in phases from April 2026. If you are self-employed or a landlord earning over £50,000 you need to start preparing to submit quarterly updates, keeping digital records and a new penalty system will apply.

Initially, MTD for IT will apply to businesses, self-employed individuals, and landlords with an annual income exceeding £50,000. From 6 April 2027, the rules will extend to those with an income between £30,000 and £50,000. A new system of penalties for late filing and late payment of tax will also be introduced.

From April 2028, sole traders and landlords with income over £20,000 will need to follow MTD rules. The government is also exploring ways to bring those earning under £20,000 within the MTD framework at a future date.

To help ensure taxpayers pay on time, HMRC increased the late payment penalties with effect from 1 April 2025. This applies to VAT-registered businesses as well as early adopters of Making Tax Digital for Income Tax.

The updated penalty rates are as follows:

• 15 days late: increased from 2% to 3%
• 30 days late: increased from 2% to 3%
• From day 31 onwards: a 10% annual penalty now applies, up from 4%, with daily interest added from this point

Taxpayers that remain with self-assessment face a separate set of penalty rules.