From April 2025, UK companies will experience a dichotomous tax environment. Whilst the top-line Corporation Tax rates are the same, increasing business rates, alterations in capital allowances, and the sunset of COVID-era reliefs equate to increased operating costs and narrower margins for many.

Meanwhile, industry-specific reliefs and investment reliefs continue to provide savvy opportunities — provided that they are properly utilized.

Here's an overview of what's changing, who's affected, and how TVR accountancy can assist you in adapting.

Business Rates Relief: COVID Support Coming to an End

One of the most popular reliefs for high street businesses is coming to an end.

What's changing?

The temporary 75% business rates relief for Retail, Hospitality and Leisure (RHL) businesses will cease on 31 March 2025

From April 2025, a lower 40% relief will be introduced — capped at £110,000 per business

This cap will result in the bill for larger retail and hospitality chains, or groups with more than one property, increasing substantially.

Permanent future reform

From 2026/27, the government intend to implement permanently reduced business rate multipliers on RHL properties with rateable values below £500,000.

Properties above this amount will be charged at a higher multiplier

This is more likely to hit big online stores and distribution centres, a lot of whom enjoyed bumper profits during COVID on lower rates

Tip: If you rent or own RHL property, now's the moment to check your rates exposure and prepare for 2025's cap — particularly if you're close to the £110,000 threshold.

Business Rates Multipliers: 2025/26 Update

Small business multiplier will be stuck at 49.9p

Standard multiplier will rise with inflation to 55.5p

This will mean most medium to large companies will pay more, even if their rateable value hasn't increased.

Full Expensing Continues: A Significant Relief for Equipment Investment

The 100% "full expensing" capital allowance for new and unused plant and machinery, which was introduced in 2023, continues.

Applies to companies (not sole traders)

Includes most main pool assets

Provides 100% tax relief in the year of acquisition

Chief exclusions:

Leased-out assets (e.g. plant bought to hire to others)

Used or second-hand assets

Businesses not trading as limited companies

There’s no set end date for this scheme, but the government has warned it may be withdrawn “when fiscal conditions allow” — so it’s worth considering now if you’re planning major capital expenditure.

Corporation Tax: No Changes, But Watch the Margins

25% rate applies to companies with profits over £250,000

19% small profits rate over £50,000

Between the bands, there's a tapered marginal rate of 26.5%

These limits are bandied out between associated companies, including any under common control in the past 12 months, whether UK or not. So even dormant or overseas subsidiaries may lower your tax bands.

Tip:

Ensure your grouping structure is checked, particularly if you're close to the £50k or £250k limits, since you might be paying a more than necessary effective rate.

Electric Vehicles & Charging Points: Relief Extended

If you're making the switch to green, the good news is:

100?pital allowance for electric vehicles and EV charging equipment will continue until:

31 March 2026 for companies

5 April 2026 for sole traders/partnerships

If you’ve been delaying switching to electric, now’s the time to reassess the business case.

Creative Sector Boost: Enhanced Reliefs for Film & High-End TV

From 1 April 2025, film and high-end television productions can claim:

An enhanced 39% Audio-Visual Expenditure Credit (AVEC) for UK visual effects

This exempts visual effects costs from the usual 80% qualifying expenditure cap

Applies to costs incurred from 1 January 2025

To claim:

Productions need a final BFI certificate

Interim claims can still be made utilizing the 34% standard AVEC rate

This is a huge boost for the UK's post-production industry and will assist visual effects-heavy productions and media organizations with UK crews.

Summary: 2025/26 Business Tax Planning at a Glance

Tax Area What's Changing when?

Business Rates Relief 75% → 40% (capped at £110k) April 2025

Permanent Rate Reform Lower rates for RHL properties < £500k April 2026

Capital Allowances 100% expensing continues for companies Ongoing

Electric Vehicles 100% relief extended until 2026

Corporation Tax

Rates and thresholds held during freeze until 2027.

Film/TV Tax Credit: 39% increased AVEC for visual effects

How TVR accountancy Can Assist

Whatever your business – whether you're a retailer hit by rising rates, a manufacturer with money to spend on machines, or a production company lining up the next shoot – the right tax planning can save you thousands — or unlock huge reliefs.

Review business rates strategy and options for mitigation

Examine eligibility for full expensing and EV capital allowances

Optimize your group structure to minimize Corporation Tax

Assist creative businesses in maximizing AVEC and obtaining BFI certification

Make sure your cashflow accounts for the corporation tax change for 2025/26

Let's examine your 2025/26 business tax exposure — before those reliefs expire.