Newsletter 10 October 2025

Making Tax Digital (MTD) for Income Tax: exemption guidance now available

If your organisation is due to join MTD for Income Tax from April 2026, and you believe you may be digitally excluded, HMRC has now opened the exemption application process.

Key point: Exemptions from MTD for VAT do not automatically apply to MTD for Income Tax.

Apply for an exemption
Check if you’re eligible

Electric vehicle mileage – new HMRC guidance

For organisations using electric vehicles (EVs) in their operations, HMRC now distinguishes between:

• Home charging
• Public charging

This affects how you calculate mileage reimbursements. This is especially relevant for outreach teams, eco-delivery services, or employees and directors using EVs.

HMRC Advisory Fuel Rates

PAYE Settlement Agreement (PSA) – NIC due this month

If you’ve agreed a PSA with HMRC for the 2024–25 tax year, your Class 1B National Insurance and tax payment is due by:

• 22 October 2025 (online payment)
• 19 October 2025 (postal payment)

How to pay your PSA

This is often used to cover minor benefits like staff gifts or eco-friendly perks.

Autumn Budget 2025 – what’s on the horizon?

The Chancellor will deliver the Autumn Budget on Wednesday 26 November. We’re watching for updates on:

• Green investment incentives
• Charity and social enterprise tax reliefs
• Capital allowances for sustainable assets

We’ll publish a Budget Summary to help you understand what it means for your organisation.

Dividend income letters from HMRC

HMRC is sending “nudge” letters to individuals who may have under-reported dividend income for 2023–24. If you receive one, please contact us before responding.

Check if you need to pay tax on dividends

Sustainable finance tip

Offsetting your carbon footprint? Did you know that some carbon offsetting schemes may qualify as allowable business expenses? Let’s talk about how to record and report these in your accounts.