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Budget Overview 2025

Chancellor Rachel Reeves delivered her budget on 26 November. Of interest to lawyers, and business owners, were the following:

Economic Crime (Anti-Money Laundering) Levy

An increase has been imposed on entities regulated for anti-money laundering purposes under the Money Laundering, Terrorist Financing and Transfer of Funds Regulations 2017. 

  • The levy on medium-sized entities will rise in 2026/27 from £10,000 to £10,200. 
  • The levies on entities with UK revenue greater than £500m will pay:
    • £500,000 for revenue £500m to £1bn
    • £1m for revenue over £1bn

Statutory basis to reward whistleblowers 

Currently any rewards issued by HMRC are discretionary. The new plan is that in cases where over £1.5m is recovered, HMRC will pay rewards up to 30% of the additional tax collected.

Minimum wage / living wage increases

From April 2026, the national minimum wage hourly rates rise.

  • The National Living Wage (all workers aged 21+) will rise to £12.71 (+4.1 pc from £12.21)
  • The minimum wage (workers aged 18-20) will rise to £10.85 (+8.5 pc from £10)
  • The minimum wage (workers aged 16-17) will rise to £8.00 (+6 pc from £7.55)

Changes to pension salary-sacrifice schemes

From April 2029, only the first £2,000 of salary-sacrificed pension contributions will remain exempt from National Insurance. Amounts above that will incur NI for both employers and employees. 

Additional support for apprenticeships

From 2025/26, training costs for apprentices under 25 employed by SMEs will be fully funded. 

Image rights payments 

The government plans to introduce legislation in a future Finance Bill to “clarify the tax treatment of image rights to ensure that all image rights payments related to an employment are treated as taxable employment income and subject to income tax and National Insurance contributions. This change will take effect from April 2027”.

Posted on 12/02/2025 by Ortolan

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