HM Revenue and Customs is cracking down on pension tax relief as part of a broader drive to maximise revenue collection, according to reports.

The tax authority is said to be stepping up its scrutiny of claims from higher earners and “lowering the threshold” for requiring evidence to support requests.

Additionally, HMRC will no longer accept claims by telephone. Instead, taxpayers are being instructed to submit claims online or by mail.

And the media reports say that individuals will also be “asked to provide evidence where it would not previously have been required”.

Under the present system, taxpayers can save a maximum of £60,000 a year into their pension and benefit from tax relief.

Basic-rate taxpayers automatically get 20 per cent relief added to their pot, while higher earners paying 40 per cent or 45 per cent tax may need to claim the extra tax relief through their self-assessment tax return.

HMRC said the changes were being made to “protect taxpayers’ money” after an internal review found some workers were making incorrect claims for pension tax relief.

It has been reported that a review of claims for up to £10,000 in relief discovered that almost a third were for incorrect amounts.

The most common mistakes were claiming without higher-rate taxpayer status, seeking relief under a “net pay” arrangement where it had already been granted and providing estimated rather than precise contribution figures.

About 80,000 claims for Personal Pension Relief are submitted to HMRC every year.

A spokesperson for HMRC told the Daily Telegraph newspaper: “We’re lowering the threshold to ensure that people claim the right amount of relief and protect taxpayers’ money.

“This comes after we conducted a review which revealed that many claims below the current evidence threshold were incorrect.”

Chancellor Rachel Reeves is reportedly considering reducing the amount of money pensioners can withdraw from their savings pot without paying tax to as little as £40,000 in her Budget in November.

If it happens, it is a move that would be expected to raise more than £2billion for the Treasury.

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The rise in employers’ national insurance contributions has had the biggest impact on small businesses, according to new analysis of official statistics.

It has revealed that the number of job vacancies at small businesses fell by a fifth in the three months to July, compared to the three months to October.

The examination of the Office for National Statistics (ONS) figures was carried out by the Liberal Democrats, The Independent newspaper has reported.

It followed the Chartered Institute of Personnel and Development’s latest Labour Market Outlook, which found cost pressures and the NICs hike had led to a record low in private sector hiring plans.

Chancellor Rachel Reeves announced the increase in employer contributions to national insurance in her 2024 Autumn Budget.

Tina McKenzie, policy chair of the Federation of Small Businesses (FSB), told The Independent: “Small businesses don’t feel the government has their backs when it comes to creating jobs.

“It’s not just hiked costs: if you threaten small businesses with court the second they hire somebody, this is the predictable result.

“Anyone working in the real economy can feel the jobs market has turned, so we’re calling on ministers to take urgent action and fix their utter mess of an employment bill before more and more people are left out of work.”

Meanwhile, there have been reports that the Treasury is considering increasing taxes on landlords by adding national insurance on rental income.

National Insurance is currently taxed at eight per cent for employed people and six per cent for the self-employed. For income and profits over £50,270, the rate falls to two per cent.

Landlords currently pay income tax on profits from rent, although there is 20 per cent relief on mortgage interest, and property investors can subtract allowable expenses, including maintenance and letting fees.

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New rules that would require small and micro companies to disclose their profit and loss statements for the first time are set to be scrapped, according to media reports.

The new Companies House rules were set to come into effect in April 2027, removing current exemptions when it comes to filing accounts.

The changes would give employees and customers will have clearer detail as to the profits that companies make and the dividends declared to shareholders.

Many small business owners were facing the fact that their own personal ‘earnings’ from a limited company would become public knowledge,

However, according to reports, business secretary Jonathan Reynolds is looking to step in to keep the current rules in place, after startups and investors warned of the difficulties the new rules would have created.

An ally of the minister was quoted in the Financial Times newspaper saying: “It doesn’t fit with our plans to cut regulation.”

If carried through, the new rules would mean much information which would not have been on the public record would no longer be private.

Micro-entities would be required to file a copy of their balance sheet and profit and loss account at Companies House.

Small companies would be required to file a copy of balance sheet, directors’ report, auditor’s report – unless exempt – and profit and loss account.

There would be also be a requirement for more information when claiming an audit exemption. Any company claiming an audit exemption would need to give an enhanced statement from their directors on the balance sheet.

The rules also aim to clamp down on abuse of dormant company status. Directors of dormant companies would need to specify which exemption is being claimed and confirm that the company qualified for the exemption.

However, opponents of the changes say that legislation that was designed to help tackle fraud and tax evasion would have the effect of forcing many taxpayers to put their private earnings on the public record.

Business leaders also raised alarms that the new requirements would ‘opens the door wide’ to competitors snooping on margins and for large companies in supply chains to scrutinise smaller suppliers’ finances – giving them an unfair advantage and damage small firms’ negotiating power.

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Rosebud, part of Lancashire County Council’s Business Growth Service, has announced a £1.5million funding pot available to lend to ambitious businesses in the 2025/26 financial year.

Administered by Lancashire County Developments Limited (LCDL), the fund is designed to support high-potential businesses based in the county looking to scale, innovate and create high-quality jobs.

Rosebud has played a pivotal role in Lancashire’s economic growth for more than 35 years. Currently, it holds 41 active debt investments, backing 38 companies operating across all 12 Lancashire County Council districts.

The impact it delivers is significant. In the last five years alone, it has helped to create 1,164 new jobs across the county.

Rosebud-backed businesses have also achieved a 61 per cent increase in Gross Value Added (GVA), a key indicator of economic contribution and productivity.

Rosebud provides loans for growing businesses of between £25,000 and £100,000 to enable them to fulfil their full potential.

It also offers guidance and support to businesses from a diverse range of sectors and industries, counting some of Lancashire’s standout business success stories in its portfolio.

Martin Emmott, fund manager at Rosebud, said: “We’re proud to be backing ambition in every corner of Lancashire. Put simply, our mission is to help Lancashire’s entrepreneurs and companies fulfil their potential.

“Through our tailored loans and growth support, we enable businesses to scale, innovate and contribute to a thriving regional economy.”

Rosebud funding is open to growing and scaling businesses across all key sectors, including advanced manufacturing, digital and low carbon industries. The fund offers access to specialist advice and wider business support via Lancashire County Council’s Growth Service and other networks.

Andy Walker, head of service, business growth and external funding at County Hall, added: “Rosebud is a standout service that plays a vital role in Lancashire’s economic growth.

“As we work to build a stronger, more resilient economy for our county, Rosebud continues to be a driving force, helping businesses grow, diversify and succeed. Its long-standing support has created skilled, sustainable jobs, boosted local productivity and delivered real, measurable benefits to communities across Lancashire.”

Businesses interested in Rosebud Loans can learn more and get in touch with its team via rosebudfinance.co.uk

HRMC continues to move forward with its Making Tax Digital (MTD) policy which sits the heart of its transformation vision.

Draft legislation for inclusion in the government’s new Finance Bill was published at the end of July.

MTD for Income Tax is due to become mandatory for landlords and sole-traders with qualifying income more than £50,000 from April 2026.

The draft legislation, published at the end of July, included lowering the Income Threshold to £20,000 from April 2028.

However, that is a move that has been questioned by the Institute of Chartered Accountants in England and Wales (ICAEW).

Frank Haskew, the organisation’s head of taxation strategy, said: “We remain concerned about extending MTD income tax to those with turnover over £20,000 from April 2028.

“Lowering the threshold will add about one million taxpayers, mostly sole traders but notably including landlords who may have only one rental property.

“This will follow shortly after the first mandatory annual tax returns are due for those with turnover over £50,000, allowing little time to assess the impact of MTD income tax before it is extended.

“MTD income tax represents the most significant change in decades for sole traders and landlords, requiring digital record-keeping and filing quarterly updates and year-end tax returns via commercial software that meets HMRC’s requirements.

“HMRC will not provide software, so taxpayers must carefully choose from available products, many of which vary significantly and may not meet their needs. More preparation is needed from both HMRC and software developers.

“While we support digitalisation of accounting records, we don’t agree with mandatory quarterly updates which add cost without benefit.

“Instead, we’d like to see the retention of annual reporting with optional quarterly updates instead. As requirements begin in less than a year, agents and taxpayers must prepare.”

The legislation also confirms:

• exemptions and deferrals for certain groups of taxpayers
• simplification of the rules for those that choose calendar rather than tax year quarters, who will now have a start date of 1 April rather than 6 April
• HMRC’s power to cancel or reset late submission penalty points and cancel financial penalties

HMRC has also confirmed it is not proceeding with Making Tax Digital (MTD) for Corporation Tax.

In a statement in its newly published Transformation Roadmap, it said: “HMRC will modernise services for Corporation Tax (CT), beginning with a renewal of internal systems for CT to provide the foundation for future improvements. HMRC do not intend to introduce MTD for CT…”

Its focus will now turn to upgrading legacy internal systems, improving digital services incrementally, and working with stakeholders on alternative reforms tailored to the “diverse CT population”.

John-Paul Marks, HMRC’s first permanent secretary and chief executive, said: “HMRC will look very different by 2030. Almost all our straightforward customer queries will be handled digitally or automatically with at least 90 per cent of customer interactions being digital.”

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