The new tax year in the UK began on 6 April, as it has for more than 225 years. As well as being the date when UK tax rules can change, it can also be a great time for sole traders and landlords to make simple changes that leave them better organised, more in control and better off. Even small changes can make a big difference. So, what improvements should you make?
1 Reconsider your prices/rent
Your costs are likely to have increased in many - if not all areas - in the past 12 months. And although you might be nervous about increasing your prices or rent, for fear of losing customers or tenants, not doing so will leave you worse off.
Knowledge of your market should tell you whether you can increase your prices/rent and, if so, by how much. You also need to be mindful of how much others charge, because you must remain competitive. Customers and tenants may appreciate why you’ve put up your prices/rent. Obviously, there are rules regarding rent increases.
2 Minimise your costs
Keeping a tight lid on your costs should always be a top priority. It’s essential if you want to keep your sole trader cash flow healthy or protect your landlord profits. Assess your current costs. All of them. Are you wasting money anywhere? Are you being charged too much by some suppliers? Could you be getting better value?
Find cost-savings where possible. Try to negotiate better deals with your suppliers. If you’re a sole trader, set monthly spending budgets and stick to them, because spending too much can have disastrous consequences.
3 Organise your financial records
With Making Tax Digital for Income Tax due to be introduced, now’s the right time to start using accounting software. If you’re already using it, maybe you need superior accounting software that’s better suited to your needs.
Get into the habit of updating your financial records more frequently. A “little and often” approach can make bookkeeping much less painful, while your figures will be more useful to you. Set aside time each week (month latest) to fully update your financial records. Use all of the time- and effort-saving features your accounting software offers. Record and categorise your costs and expenses as they arise (linking a credit/bank account to accounting software can make this really easy).
New tax year – new you
You can file your self-assessment from the 6th April. Know your tax owed and start the tax year in control.
For self-employed individuals, sole traders, or those with non-PAYE income, GoSimpleTax provides direct self-assessment filing with HMRC, offering helpful hints and savings tips throughout the process. Let GoSimpleTax handle all calculations.
4 Start working with cash flow forecasts
When businesses fail, it’s usually because they’ve run out of cash and can’t pay their bills when required. The best way to try to avoid serious cash flow problems is to produce cash flow forecasts based on estimated likely future income and costs/expenses. Comparing the two enables you to identify times when you’re at risk of running out of cash, so you can do something about it now, when you still have time.
5 Put enough money away each month for tax
Suddenly being confronted with a tax bill that you can’t pay is literally the stuff of nightmares. It’s far better to put away a percentage of your monthly income (20%-25%) into a separate bank account, so that you have enough set aside to cover your tax bill.
The GOV.UK website has a free online tool that will give you an estimated self assessment tax bill based on the weekly or monthly income figure you enter. Accounting software can also tell you roughly how much tax you owe based on the figures you record.
6 File your self assessment tax return sooner
Why not get your self assessment tax return done and filed much earlier this year? Who needs all of the hassle and panic every January, as the online filing deadline fast approaches? You can file any time after the new tax year begins on 6 April (each year, some 300,000 people file their tax return in the first week of the new tax year, almost 10 months before the online filing deadline).
Filing earlier doesn’t mean you have to pay your tax bill any sooner, but it will mean that you know how much tax you owe much sooner, so you can budget and save to pay your bill when due. You may even be lucky enough to find out much sooner that you’re due a tax refund.
7 Find out about UK tax changes for 2025/26
Several important changes to tax rules were introduced at the beginning of April and some might affect you. These include:
- A rise in employers’ National Insurance contributions (NIC) by 1.2% from 13.8% to 15%. The threshold at which employer NICs become payable also fell from £9,100 to £5,000, which many employers certainly won’t welcome.
- Thankfully, the Employment Allowance is now more generous. On 6 April, the allowance increased from £5,000 to £10,500. The £100,000 threshold £100,000 has also been removed, enabling more employers to benefit.
- Some minor inflationary changes to Scottish Income Tax thresholds also came into effect on 6 April 2026.
- Voluntary National Insurance rates increased slightly for 2025-26. Class 2 NICs are now £3.50 a week, while Class 3 NICs increased to £17.75 a week.
- Statutory and National Living Wage (NLW) and National Minimum Wage (NMW) increases also came into effect from 1 April 2025. Rates increased to:
○ £12.21 per hour for anyone aged 21 and over.
○ £10.00 per hour for 18 to 20-year-olds.
○ £7.55 per hour for 16 to 17-year-olds and apprentices in the first year of their apprenticeship. - The Furnished Holiday Lettings (FHL) tax regime came to an end. Income and gains from FHL properties will now be subject to tax treatment in line with all other income and gains from property.
Copyright 2025. Sponsored post by GoSimpleTax - tax return software that can help you manage your self assessment.