With autumn now well underway, October brings with it a number of important tax and payroll developments that businesses and individuals should be aware of.
In this month’s newsletter, we look at HMRC’s plans to issue around 1.8 million Simple Assessment letters for the 2025–26 tax year and explain what recipients should do when their letter arrives.
We also consider the potential PAYE and National Insurance obligations for UK employers with employees who normally work overseas but come to the UK to carry out their duties.
For businesses and self-employed individuals who have experienced a difficult trading period, we look at how trading losses may be used to reduce tax liabilities and, in some circumstances, generate a tax refund. We also highlight HMRC’s new online Self Assessment registration service, which aims to make the registration process quicker and easier for those who need to submit a tax return for the first time.
We hear from our Corporate Finance Team about our exiting collaboration with Blaser Mills Law. With a number of important filing and payment deadlines approaching over the next couple of months, our Tax Diary provides a useful checklist to help ensure nothing is overlooked.
HMRC sending 1.8m Simple Assessment letters
Some taxpayers have already started to receive Simple Assessment letters from HMRC for the 2025-26 tax year, with a further tranche due to be sent between October and December 2026.
Simple Assessment is used where HMRC cannot collect income tax through PAYE or self-assessment. The PA302 letter sets out HMRC’s calculation of the tax due, based on information it holds.
Common examples include tax due on pension income, savings interest, dividends or if the taxpayer has a second source of income that has not been taxed. It can also apply where someone has received more tax-free allowance than they were entitled to, or where the amount owed cannot be collected through a tax code, typically £3,000 or more.
HMRC began sending letters to working-age taxpayers from 30 June 2026, followed by letters to pensioners from 12 August. A second tranche, relating to bank and building society interest (BBSI) data, is expected to be issued between October and December 2026. In some limited cases, taxpayers may receive more than one letter for 2025-26.
Tax can be paid in full or by instalments, with the deadline depending on when the Simple Assessment letter is received. For the 2025-26 tax year, letters received before 31 October 2026 require payment by 31 January 2027. Letters received on or after 31 October 2026 require payment within three months of the date of the letter.
HMRC expects to issue around 1.8 million Simple Assessment letters for the year. Taxpayers receiving a letter should check the calculation carefully against their own records and contact
HMRC if they believe any information is incorrect or the assessment should be withdrawn. If you receive a Simple Assessment letter and are unsure whether the calculation is correct, what you need to pay or what action you should take, please contact us. We can review the assessment and help you understand what it means and how to deal with it.
UK employers with overseas employees
UK employers with employees who normally work overseas may have PAYE and National Insurance obligations when those employees come to the UK to carry out their duties in the UK on a short-term basis.
Employers should consider the position whenever an overseas employee visits the UK to work. The fact that the employee remains employed and paid by an overseas company does not, by itself, mean that there is no UK PAYE obligation. In some circumstances, the UK company hosting the employee may be responsible for operating PAYE.
There are arrangements that can help employers with the normal PAYE requirements for qualifying short-term business visitors. For example, an EP Appendix 4 arrangement may allow a UK host employer not to operate PAYE where the relevant conditions are met, including where a double taxation agreement applies and no UK Income Tax liability ultimately arises. National Insurance needs to be considered separately, as an Appendix 4 arrangement does not cover NICs.
Where PAYE is required but it is impractical to operate it in the normal way, an EP Appendix 8 arrangement may be available for certain short-term business visitors. This allows the employer to report and pay the relevant tax after the end of the tax year, subject to the conditions of the arrangement.
If you have overseas staff working in the UK, we can help you make sure your payroll processes are correct.
When can a trading loss generate a tax refund
Making a trading loss whilst not ideal can sometimes generate a tax refund. If you are a self-employed individual or a member of a trading partnerships, a trading loss can potentially be set against other income or capital gains. This can reduce the amount of tax payable and, where tax has already been paid, may result in a refund.
For the 2025-26 tax year that ended in April, a loss can generally be set against income for the same year or the previous tax year. This means a business that made a profit in an earlier year but has subsequently made a loss may be able to recover some of the tax previously paid.
There are restrictions. For example, the trade must generally be carried on commercially and for profit, rather than as a hobby. Other restrictions can apply depending on the circumstances, including where the individual works fewer than 10 hours a week on the commercial activities of the trade.
There is also a limit on the amount of certain Income Tax reliefs that can be claimed against total income. The limit is generally the higher of £50,000 or 25% of adjusted total income.
A loss can also usually be carried forward and used against future profits from the same trade. If you have a trading loss, it may provide an opportunity to reduce an earlier tax bill, generate a refund or reduce tax on future profits. The rules can be complex, and we are happy to help provide advice on the best way forward.
New self-assessment registration service launched
HMRC has launched an improved online service to make it easier for individuals to register for self-assessment. Anyone who needs to submit a tax return for the first time for the 2025–26 tax year should notify HMRC by 5 October 2026 to avoid a potential penalty.
The new service is available through a Personal Tax Account and includes pre-populated information, online support during registration and the ability to save and return without losing information. Taxpayers will also receive confirmation by email or text when their registration is complete.
Once registered, taxpayers receive a Unique Taxpayer Reference (UTR), which is needed to complete their tax return. Under the new service, the UTR should appear in the taxpayer’s online account within 72 hours, instead of taking up to 15 days to arrive by post.
Taxpayers who are unsure whether they need to submit a tax return can use HMRC’s online checking tool. Those who need to register may include newly self-employed individuals with gross trading income above £1,000, a new partner in a business partnership and taxpayers with more than £2,500 of untaxed income.
The deadline for submitting the 2025–26 self-assessment tax return and paying any tax due is 31 January 2027.
Anyone who no longer needs to complete a tax return should tell HMRC as soon as possible.
Until HMRC confirms that a self-assessment return is no longer required, taxpayers should continue to meet their self-assessment filing obligations.
The new registration service is currently available to individual taxpayers with a Personal Tax Account. Agents must continue to use the existing registration processes, including using forms CWF1 or an SA1, to register.
Autumn Budget 2026: Are You Ready?
The Autumn Budget is fast approaching, and with businesses continuing to navigate economic uncertainty, cost pressures and evolving market conditions, now is the time to focus on preparation, not prediction.
On 28 October, the Chancellor will deliver the first Budget of the new administration. While much of the discussion in the media centres around speculation and potential tax changes, the reality is that business owners need practical guidance, not guesswork.
That’s why, throughout October, The MGroup will be publishing a dedicated three-part Autumn Budget 2026 series, designed specifically for business owners, entrepreneurs and decision-makers who want to understand what matters, what may impact their organisations and, most importantly, what actions they should be taking now.
As trusted advisers to businesses across Oxfordshire and beyond, we know that periods of uncertainty often create hesitation. However, waiting for complete clarity can lead to missed opportunities. The businesses that perform best are often those that continue planning, reviewing their finances and making informed decisions while others stand still.
Our three part series has been created to help you do exactly that. Over the coming weeks, we’ll explore the key themes emerging ahead of the Budget, examine the areas most likely to affect businesses and provide a practical readiness checklist to help you approach Budget Day with confidence.
Rather than adding to speculation, our focus is simple: Helping you make informed business decisions with confidence. Whether you’re planning for growth, reviewing investment opportunities, managing cashflow or preparing for 2027, our Budget series will provide practical insight, expert commentary and actionable guidance every step of the way.
Blaser Mills and The MGroup Collaboration
At The MGroup, we’re committed to providing business owners with practical, relevant insights that help them navigate opportunities, challenges and important strategic decisions. By bringing together expertise from across our network of specialists, we aim to deliver real world guidance that supports growth, protects value and helps businesses plan confidently for the future.
Our recent four-part M&A series, produced in collaboration with Blaser Mills, explored the key trends shaping today’s transactions market and the practical steps business owners can take to achieve a successful outcome. Drawing on insights from both corporate finance and legal specialists, the series highlighted the importance of early preparation, realistic valuations, robust financial reporting, strong management teams and well-structured legal documentation.
Businesses that begin planning their exit strategy two to five years in advance are often better positioned to maximise value, reduce risk and navigate the transaction process with confidence. The central message throughout was clear: successful deals are built on both commercial and legal readiness, with joined up advice helping business owners achieve the best possible result.
Read each article below.
Driving Insight That Helps Business Owners Stay Ahead
Our recent collaboration with Helen Postlethwaite, Managing Director at Langcliffe International, explored why the Testing, Inspection, Certification and Compliance (TICC) sector continues to attract significant M&A interest.
The discussion highlighted how recurring, regulation driven revenues, fragmented markets and increasing compliance requirements are creating strong opportunities for consolidation and investment.
Geoff and Helen shared how buyers are particularly focused on businesses with strong technical expertise, established management teams, recurring income streams and exposure to critical sectors such as infrastructure, utilities, energy and transport. With increasing interest from both UK and international acquirers, well-positioned TICC businesses continue to benefit from robust buyer demand and attractive valuation dynamics.
Click HERE to hear more from Helen and Geoff
Read the full article HERE
Looking ahead
As we move further into the year, staying informed and planning ahead continues to be important for both individuals and businesses.
If you would like to discuss any of the topics covered, or talk through your plans for the year ahead, our team is always happy to help.