26 June 2026
On 23 June 2026, the government published a package of tax policy announcements and supporting documents in an update titled Tax update 2026: simplification, modernisation and fairness. The government has published a policy paper, summarising the day’s announcements. A written ministerial statement on the announcements was made by Exchequer Secretary to the Treasury Dan Tomlinson MP.
A number of new and upcoming consultations were announced as part of the package, most of which relate to the taxation of individuals, indirect taxes, or customs. These include a consultation on changes to the taxation of distributions, however this focusses on individual and trust shareholders and HMRC state that the proposals are “not intended to affect corporate shareholders directly.”
Other tax announcements in the package were also largely non-business tax focussed. Business tax-related announcements included plans to introduce secondary legislation to prevent research and development and creative sector expenditure credits from bringing companies into the corporation tax quarterly instalment payment (QIP) regime where those companies would not otherwise be required to pay via QIPs.
On 23 June 2026, HMRC published guidance on their 'transitional approach' to (i) penalties; and (ii) Global Information Return (GIR) filing and exchange, for businesses within the scope of the UK’s Pillar Two top-up taxes (multinational top-up tax and domestic top-up tax).
Under the UK's transitional approach to penalties, no late filing penalty will be applied to a return (GIR, self-assessment return and/or overseas return notification (ORN)) that is filed by 1 August 2026.
In addition, the UK has endorsed the OECD's ‘common understanding’ on Pillar Two filings and agreed not to enforce local filing or penalties where an ORN is submitted on time. HMRC have clarified that on time means by 1 August 2026 under HMRC's transitional approach. The ORN must specify the date the GIR was filed overseas. However, if software issues mean the GIR cannot be filed in the overseas jurisdiction before the ORN is due, HMRC advise that the group should nevertheless file the ORN on time, but use a notional GIR filing date of 1 January 2026.
HMRC have published the latest edition of their annual statistical publication Measuring tax gaps. The estimated ‘tax gap’ – HMRC’s best estimate of the difference between the amount of tax that should in theory have been paid, and what was actually paid – for the 2024/25 tax year was 6.4% (up from a revised estimate for 2023/24 of 6.0%), representing an estimated £59.2 billion of missed receipts out of total theoretical tax liabilities of £924.4 billion for the year. A breakdown of the tax gap by tax-type lists ‘corporation tax’ as accounting for an estimated 35% of the total tax gap. ‘Income tax, national insurance contributions and capital gains tax’, together, also represent an estimated 35% of the total tax gap, with VAT representing 20%. Broken down by taxpayer groups, an estimated 62% of the tax gap is attributed to small businesses, whilst the proportions attributable to mid-sized businesses and large businesses are 7% and 12% respectively. ‘Failure to take reasonable care’ remains the main behavioural reason for missing receipts, representing an estimated 35% of the total tax gap.
The text of the Taxation (Energy and Vehicles) Bill was published on 24 June 2026, together with its explanatory notes. The Bill had its first reading in the House of Commons on 24 June 2026. The Bill includes legislation to enact the previously announced increase to the Electricity Generator Levy (EGL) rate from 45% to 55%, with effect from 1 July 2026 (see our previous Business Tax Briefing). The Bill also includes legislation for two previously announced car taxation changes.
On 17 June 2026, the government announced that the UK-India Double Contributions Convention (DCC) will enter in force on 15 July 2026, alongside the new UK-India Free Trade Agreement. The DCC aims to prevent double social security contributions for eligible employees temporarily working in the other country for up to 36 months (see our previous Business Tax Briefings here and here).
The next EMEA Dbriefs webcast will take place on Thursday 2 July 2026 at 12.00 BST/13.00 CEST. In Business travel & remote work survey report, a global client panel will review and debate the recently published Deloitte GES Business Travel & Remote Work Survey Report.
The report explores how organisations are managing the growing complexity of business travel and cross-border remote working amidst evolving regulations, heightened enforcement and employee expectations around flexibility. Our panel will discuss key findings and explore challenges faced by organisations when building and managing compliance programs, including governance and ownership, the tension between employee experience and compliance, data and tracking, and thresholds and trigger points.