Business Tax Briefing

‘L-Day’ announcements and HMRC’s Transformation Roadmap

On Monday 21 July 2025 (‘L-Day’), the government published a number of draft clauses intended for the next Finance Bill for technical consultation. The draft clauses are accompanied by explanatory and impact notes, and comments from stakeholders are invited by 15 September 2025. The Exchequer Secretary to the Treasury, James Murray MP, also issued a written ministerial statement summarising the draft legislation published and “making announcements in a small number of technical areas of tax policy to ensure the effective maintenance of the tax system”. Please see our article for a full summary of the L-Day announcements.

Draft legislation and other announcements included: 

• Reform of the tax treatment of carried interest – draft legislation was published for the new carried interest regime that will come into effect from 6 April 2026. Read more in our alert. 

• Multinational Top-up Tax and Domestic Top-up Tax – draft legislation was published covering a number of areas, designed to bring the UK legislation up to date with the latest OECD Inclusive Framework commentary. In addition, it corrects or clarifies some technical points within the existing UK legislation.
• Tackling non-compliance in the umbrella company market – draft legislation was published that would make employment agencies joint and severally liable for amounts payable under PAYE where workers are supplied via umbrella companies. Where there is no agency, the joint and several liability would fall to the end client business. Further legislation is to be introduced giving HM Treasury the power to make regulations imposing an equivalent joint and several liability for NIC purposes.
• Land Remediation Relief – HM Treasury published a new consultation on the design and impact of Land Remediation Relief (LRR). The consultation closes on 15 September 2025.

Also on 21 July 2025, the government published HMRC’s Transformation Roadmap. The roadmap sets out the actions HMRC will take to achieve each of their three priorities set by the government: improving day-to-day performance and the customer experience, closing the tax gap, and reforming and modernising the tax and customs system. Of particular note to businesses is HMRC’s confirmation that they do not intend to introduce Making Tax Digital for Corporation Tax (CT), which would have required companies to provide quarterly electronic updates. Instead, HMRC will develop “an approach to the future administration of CT that is suited to the varying needs of the diverse CT population” and will work with stakeholders to identify potential changes for consultation.

UK lists of countries with qualified status for Pillar Two purposes updated  

HMRC have published a notice specifying Spain and Guernsey as Pillar Two territories with a qualified income inclusion rule and a qualifying domestic top-up tax (QDMTT) that meets safe harbour standards. HMRC’s notice has retrospective effect from 31 December 2023 (Spain) and 1 January 2025 (Guernsey). The notice follows regulations made by HM Treasury earlier in 2025 to specify initial lists of Pillar Two territories and QDMTTs. The notice brings the UK lists in line with the latest version of the OECD Inclusive Framework’s central record, updated in March 2025, of jurisdictions whose local implementation of the Pillar Two rules have so far been assessed as ‘qualified’.

OECD publishes updated transfer pricing country profiles

The OECD has published updated transfer pricing country profiles reflecting the current transfer pricing legislations and practices of various countries. According to the OECD, the profiles focus on countries' domestic legislation regarding key transfer pricing aspects, including the arm's length principle, methods, comparability analysis, intangible property, intra-group services, cost contribution agreements, documentation, administrative approaches to avoiding and resolving disputes, safe harbours and other implementation measures. The updated profiles include new sections on the simplified and streamlined approach for baseline marketing and distribution activities (resulting from the work on Amount B of Pillar One) and the transfer pricing treatment of hard-to-value intangibles. Updated profiles have been published for Austria, Belgium, Canada, Ireland, Latvia, Lithuania, Mexico, the Netherlands, New Zealand, Singapore, South Africa, and Spain.

EMEA Dbriefs webcasts

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