A summary of how the Spring Statement 2025 affects Northern Ireland businesses.
The Chancellor, Rachel Reeves, delivered the Spring Statement on Wednesday 26 March 2025. Find a summary of the key announcements to understand their potential impact on your business.
Forecasts
Growth forecast
- 1.9% of Gross Domestic Product (GDP) in 2026
- 1.8% of GDP in 2027
- 1.7% of GDP in 2028
- 1.8% of GDP in 2029
Debt Forecast
- 82.9% of GDP in 2025-26
- 83.5% of GDP in 2026-27
- 83.4% of GDP in 2027-28
- 83.2% of GDP in 2028-29
- 82.7% of GDP in 2029-30
Borrowing forecast
- 3.9% of GDP in 2025-26
- 3.1% of GDP in 2026-27
- 2.5% of GDP in 2027-28
- 2.3% of GDP in 2028-29
- 2.1% of GDP in 2029-30
Northern Ireland-specific announcements
The NI Executive will receive an additional £14 million through the Barnett formula in 2025-26.
Making Tax Digital
The government will expand the rollout of Making Tax Digital for income tax Self Assessment to sole trades and landlords with incomes over £20,000 from April 2028.
Increase in late tax payment penalties
The government will increase late payment penalties for VAT taxpayers and income tax Self Assessment taxpayers as they join Making Tax Digital from April 2025 onwards. The new rates will be 3% of the tax outstanding where tax is due by 15 days, plus 3% where tax is overdue by 30 days, plus 10% per annum where tax is overdue by 31 days or more.
Tackling unpaid tax
The government will invest £87 million over the next five years in HM Revenue & Customs (HMRC’s) existing partnerships with private sector debt collection agencies to collect more unpaid tax debts. The government is also investing to recruit additional HMRC debt management and compliance staff over the next five years.
Tax consultations
The government is publishing a consultation on options to enhance HMRC’s powers and sanctions to take swifter and stronger action against tax advisers who facilitate non-compliance. See the government’s consultation on enhancing HMRC’s ability to tackle tax advisers facilitating non-compliance.
The government is also seeking views on a range of new measures to close in on promoters of tax avoidance. See the government’s consultation on closing in on promoters of tax avoidance.
Defence spending
The government will increase defence spending by providing an additional £2.2 billion of funding for the Ministry of Defence (MOD) for 2025-26. The government plans to reform defence procurement to make it quicker and give small businesses better access to MOD contracts.
The government is increasing the proportion of the MOD’s equipment procurement spend on novel technologies like dual-use technology, uncrewed and autonomous systems and AI-enabled capabilities, spending at least 10% from 2025-26.
Universal Credit
The Universal Credit standard allowance will increase for new and existing claims above inflation from April 2026. This means the standard allowance weekly rate for a single person aged 25 and over will increase from £92 in 2025-26 to £106 in 2029-30.
The Universal Credit health element will be frozen for existing claimants until 2029-30. For new claims, the Universal Credit health element will be reduced to £50 a week in 2026-27 and then frozen until 2029-30.
Further details on the Spring Statement 2025
See full details and accompanying HM Treasury documentation for the Spring Statement 2025.
First published 26 March 2025
