New Chancellor appointed
John Healey MP replaced Rachel Reeves MP as Chancellor of the Exchequer on 20 July 2026. He was previously Secretary of State for Defence from 5 July 2024 to 11 June 2026. Before entering Parliament, he was Campaigns Director at the Trades Union Congress and a disability rights campaigner.
VAT on energy bills cut
The government has announced that VAT on domestic electricity bills will be reduced from 5% to 0% from 1 October 2026.
Legislation update
The Taxation (Energy and Vehicles) Bill has received Royal Assent, becoming the Taxation (Energy and Vehicles) Act 2026. The Act increases the rate of the electricity generator levy and the approved mileage rate, and provides for temporary rates of vehicle excise duty for goods vehicles. An earlier article provides further information.
Regulations have been laid concerning:
- the introduction of the carbon border adjustment mechanism (CBAM) (SI 2026/802; SI 2026/809 and SI 2026/830;). HMRC has published a collection page for its guidance on CBAM;
- the establishment of the loan charge settlement scheme. New guidance on scheme has been published by HMRC; and
- the requirement to register as a tax adviser. The regulations provide an exemption for advisers who interact with HMRC in their capacity as an import one-stop-shop representative or in relation to a tax that is not payable to HMRC (eg, business rates). A separate article explains recent developments with regard to the timetable for mandatory agent registration.
Consultation update
The government has:
- published a summary of responses to the consultation published in October 2024 on simplifying the taxation of offshore interest; and
- launched technical consultations on draft legislation that:
- lowers the annual cash individual savings account (ISA) subscription limit (closing date: 2 August 2026);
- updates definitions in the bank levy legislation (closing date 13 August 2026); and
- makes changes to the requirements for data received by HMRC on interest income and card sales (closing date: 20 August 2026).
ICAEW may respond to the technical consultations. If you have feedback that could contribute to a response, please contact the Tax Faculty.
Class 3 NIC
HMRC has published an online tool which can be used to pay voluntary class 3 national insurance contributions (NIC) where the person has received a letter from HMRC.
Welsh Revenue Authority
The Welsh Revenue Authority has published its annual report and accounts for 2025/26.
Insolvency
HMRC has published insolvency practitioner bulletin 2 (2026). Publication of the bulletin follows the High Court decision in Noal SCSp & Ors v Novalpina Capital LLP & Ors [2025] EWHC 1392 (Ch), which HMRC says “makes clear that waiting for HMRC to submit a claim is not a reasonable excuse for exceeding the 12-month limit”.
Tax Faculty
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