Finance Bill 2025-2026

Hard on the heels of the Budget on 26 November 2025 came the publication of the Finance Bill, on 4 December. At 536 pages, 279 clauses and 23 Schedules, this is one of the longest Finance Bills that has been published for many years. The Bill includes the three sets of provisions that impact tax agents (mandatory registration, enhanced powers to tackle tax adviser non-compliance and further measures to tackle those promoting tax avoidance schemes) – see below. The Bill received its second reading on 16 December and will now go into Committee stages (firstly a Committee of the whole House on 12 and 13 January and then into Finance Bill Standing Committee).

The Tax Faculty submitted a briefing on the second reading that focused on the tax agent provisions, which we think still need further work to make them properly targeted, proportionate and not impose additional burdens and costs on the tax services market. We set out our concerns in a recent article.

The Tax Faculty will be submitting a number of representations on specific clauses in the Finance Bill as it passes through its Committee stages. If members have any comments and concerns about specific clauses in the Bill, please share these with us as soon as possible so we can consider including them in our representations.

Modernising and mandating agent registration

In the Autumn Budget 2025, the government announced that it would not be proceeding with regulation of tax advisers. This was a welcome announcement, especially given our concerns that the mandatory agent registration rules amount to a form of quasi regulation, but do not have the independence and the necessary checks and balances needed as part of a regulatory regime. As noted last month, ICAEW staff and volunteers have continued to engage extensively with HMRC to try and ensure that the agent registration provisions are improved.

The Budget documents also confirmed that HMRC plans to work with the tax profession on further measures to raise standards in the tax advice market. This work is due to start in early 2026 although, at the time of writing, it is not clear what HMRC might be looking to propose given the extensive tax agent measures, mentioned earlier, that are due to be implemented in 2026.

PCRT

The updated PCRT comes into force from 1 January 2026. Jane Mellor, Head of Professional Standards at Chartered Institute of Taxation (CIOT) and Association of Taxation Technicians (ATT) recorded a webinar with ICAEW’s Lindsey Wicks to explain the key changes. This webinar is now available on ICAEW’s PCRT webpage.

More timely payment for self assessment

The Budget included an announcement that the government would be launching a consultation in early 2026 on the timelier payment of income tax from April 2029 in cases where:

• A taxpayer has income taxed under self assessment alongside income which is subject to pay as you earn (PAYE) – the idea being to allow for the self assessment tax to be coded out via PAYE.
• A taxpayer only has income taxed under self assessment subject to the existing payments on account rules – the idea being to advance those payments and make them more regular.

We attended a preliminary meeting with HMRC and colleagues from CIOT to discuss these proposed measures and the likely considerations and impacts of such changes. We would welcome members’ view on this topic.

HMRC service performance

Although HMRC’s data suggests that its telephone and post service has improved in the last quarter, this masks a more complex picture. HMRC’s processing of older post and tax repayments remains poor, with HMRC’s own dashboard reporting repayment processing delays of up to ten months, a deeply concerning statistic which has been picked up in the media.

For the tax system to function effectively it is vital that taxpayers and agents can access timely and good quality support from HMRC. Feedback from our own members continues to suggest that HMRC is failing to deliver this in many cases. The Tell ABAB survey published on 31 October 2024 continues to highlight the need for services to improve, with telephony and webchat continuing to receive overall poor ratings. This chimes with the conclusions of the joint report that ICAEW undertook with CIOT, published in December 2024, which found that agents often faced difficulties contacting HMRC and especially in resolving any query at the first attempt, forcing repeated contact to try and resolve matters. We were pleased to see that the joint report was referred to by the Admin Burdens Advisory Board in its latest annual report, published on 17 December 2025. In early 2026, we are meeting with CIOT colleagues to consider updating our 2024 service performance report.

Meetings with HMRC

During the month, ICAEW Tax Faculty staff attended several meetings with HMRC, often in conjunction with other representative bodies. These included: the One-To-Many Compliance Advisory Board; the MTD External Readiness Forum; and the Self-employment Income Tax Forum.

Tax Faculty and other meetings

Meetings held during the month included: the Tax Policy & Reputation Committee; the Tax Faculty Board; The Technical and Oversight Committee, the Compliance and Investigations Committee; the Practitioner Tax Committee; the Employment Taxes and NIC Committee and the Digital assets working party. Tax Faculty staff also briefing the ICAEW Practice Committee and the National Technical Advisory Committee on the tax agent provisions highlighted above.

Media activity

Tax Faculty comment and articles received a wide range of coverage in the media, including in the Times, and Adelle Greenwood appeared on BBC Radio 4’s Moneybox to talk about the changes to salary sacrifice.