Spring Statement 2026: What Businesses Should Expect on 3 March
Today we’re focusing on what to expect in tomorrow’s Spring Statement – whilst it probably won’t have any major tax implications, it could set the tone for the coming months.
Spring Statement 2026: What Businesses Should Expect on 3 March
The Spring Statement will be delivered in Parliament on 3 March, giving an update on the state of the UK economy and the government’s financial outlook.
Unlike the Autumn Budget, the Spring Statement is unlikely to be used for big tax decisions. For businesses it is a useful event as it may set the tone for the months ahead and could give early clues about future tax and spending pressures.
What the Spring Statement is
The Spring Statement is built around the latest set of economic forecasts from the Office for Budget Responsibility (OBR). The OBR publishes forecasts twice a year and considers areas such as growth, inflation, unemployment, government spending and tax income.
The OBR also has responsibility for checking whether the government is on track to meet its self-imposed fiscal rules. However, the Spring Statement will not make a formal assessment of this area as this is now only being reviewed once a year, in the autumn.
Even so, the OBR’s numbers are still likely to influence decisions the Chancellor will make later in the year.
What Is Happening
The Chancellor’s speech is likely to begin shortly after midday on 3 March. As soon as the speech is finished, the OBR’s full forecast will be published on the government website.
This is a change from previous practice, where the OBR would publish their forecast on their own website. However, due to the early accidental release of OBR data at last year’s Autumn Budget, controls are being tightened on how and when the forecast is published.
Will There Be Any Tax or Spending Changes?
This seems to be highly unlikely. The Chancellor has made clear that she intends to announce major policy decisions only once a year, at the Budget in the autumn. The idea is to stop the cycle of constant speculation that can affect business planning and household spending.
However, while we are not likely to see new tax rises or cuts in the Spring Statement, we could perhaps see smaller administrative or follow-up measures.
For most businesses though, the real interest will lie in the OBR’s figures, especially inflation, growth and unemployment, as these influence future interest rates and wage pressures and may indicate the likelihood of tax changes later in the year.
For example, persistent weak growth or rising unemployment may increase the pressure to raise taxes or limit spending. Alternatively, if the OBR gives a more optimistic outlook, especially on inflation, it may strengthen the case for interest rate cuts.
In summary, the Chancellor’s speech is not expected to make sweeping policy changes, but her comments could give a sense of how the government sees the economy developing over the next 12-18 months.
A Practical Look at the Cycle to Work Scheme for Employers
The Cycle to Work scheme continues to attract interest from employees and employers alike looking to optimise their salary package and perhaps gain a tax break.
Below is an overview for businesses considering running a scheme or reviewing their existing arrangements.
The Basic Structure
The scheme allows an employer to provide a bike and eligible safety equipment tax free to their employees.
This is often done in conjunction with a salary sacrifice agreement where the employee’s gross pay is reduced for a set period to cover the costs. The salary sacrifice means the employee pays less income tax and national insurance, and the employer pays less employer national insurance.
Bikes can be provided in different ways.
- The bike and equipment can be loaned to the employee.
- A voucher can be provided so that the employee can hire the bike and equipment.
- Pool cycles can be made available for the general use of employees.
At the end of the hire period, employees can either continue hiring, return the bike, or buy it at a fair-market-value payment based on HMRC guidance.
Conditions That Must Be Met
To be compliant with the rules:
- The employee must not own the bike during the hire period.
- The bike must be used mainly (>50%) for commuting or work-related travel.
- The scheme must be available to the whole workforce.
Practical Considerations for Employers
Most employers work with a third-party provider to manage the administration work, although there is no reason it cannot be run in-house.
HMRC does not expect employers to monitor the non-work use employees make of the bike, nor are employees expected to keep detailed records of their bike use to justify how it is being used.
If salary sacrifice is being used along with the Cycle to Work scheme, there is a need to be careful that the scheme still meets the requirement to be available to all employees.
Subject to partial exemption rules, VAT can be reclaimed on any bikes and equipment purchased by the employer.
In Conclusion
Cycle to Work remains a straightforward way for employers to provide tax efficient support to their employees. If you would like personalised advice on whether or how a scheme could work in your workplace, please get in touch. We would be happy to help you!