HM Revenue and Customs has announced significant fee increases for anti-money laundering supervision affecting approximately 37,000 UK businesses, with accountancy firms facing a 33% rise in their annual premises fee.
The changes, effective from 1 December 2025, mark the first fee adjustment since May 2019 and will see the premises fee increase from £300 to £400 for most firms.
Despite receiving 478 responses during a consultation period, with many expressing concerns about the scale of increases, HMRC is proceeding with most of its proposed changes.
News Summary in 30 Seconds
- Premises fee increasing from £300 to £400 (33% rise)
- Fit and proper test fee rising from £150 to £500 (reduced from proposed £700)
- Application fee reintroduced at £300 (waived for small businesses)
- Sanctions administration charge increasing from £1,500 to £2,000
- Changes effective 1 December 2025
- First fee increases since May 2019
- 94% of single premises firms are affected
- Small business fee reduction available but underutilised
The Premises Fee Increase
The annual premises fee will jump from £300 to £400 for all HMRC-supervised businesses, including accountancy service providers, money service businesses, trust and company service providers, art market participants, and high-value dealers.
HMRC justifies the 33% increase by citing Consumer Price Index inflation since May 2019. If fees had increased annually with CPI, they would now stand at £387 to £390.
An estimated 94% of supervised businesses operate from a single premise, meaning they’ll face a £100 annual increase. The premises fee represents almost 90% of HMRC’s total supervisory fee income and serves as a proxy for business size and supervision costs.
Fit and Proper Test Fee Changes
The fit and proper test fee will increase from £150 to £500, though this represents a reduction from HMRC’s original proposal of £700. This one-off fee applies only to money service businesses and trust or company service providers due to heightened money laundering risks in those sectors.
HMRC justifies the increase by pointing to a significant rise in retesting activity. The number of fit and proper retests carried out by HMRC has increased by 80% between 2020-2021 and 2024-2025. The authority does not charge for these retests, meaning current fees do not reflect actual costs incurred.
Based on historical data, the increase is expected to add approximately £170 to annual costs for money service businesses and £65 for trust and company service providers on average. The fee is paid once per beneficial owner, officer or manager per business and does not time-expire.
Application Fee Reintroduction
HMRC is reintroducing a one-off application fee of £300 for businesses registering for AML supervision for the first time. This represents a reduction from the originally proposed £400 fee following consultation feedback.
The application fee represents the additional costs of scrutinising new applications, which require a more detailed review than annual renewals. The fee will also apply to businesses whose registration has been cancelled due to failure to pay fees on time.
To address concerns about barriers to entry for startups and small businesses, HMRC will waive the application fee for businesses eligible for the small business fee reduction. These firms can reclaim it along with their small business fee refund.
Small Business Fee Reduction Awareness
Analysis following the consultation revealed that fewer than 50% of eligible businesses are claiming the small business fee refund. This low uptake rate has prompted HMRC to commit to further outreach and awareness-raising campaigns.
Businesses eligible for the small business fee will face an annual increase of just £20, from £180 to £200, rather than the full £100 increase. This represents an 11% rise compared to the 33% increase for standard premises fees.
Many small accountancy service providers appear unaware of this reduction scheme or mistakenly believe they are ineligible. Details of the small business fee and eligibility criteria can be found on GOV.UK.
Sanctions Administration Charge
The sanctions administration charge will increase from £1,500 to £2,000 for imposing penalties on non-compliant businesses. HMRC has also broadened the scope to cover all types of sanctions, not just financial penalties.
The core principle remains that compliant businesses should not subsidise the costs of supervising non-compliant firms. Since 2019, HMRC has expanded its use of various supervisory tools beyond financial penalties, and the revised charge aims to cover these additional costs.
The charge is capped so it does not exceed the value of any financial penalty imposed. A separate, lower fee of £350 applies for failing to notify HMRC of key changes or failing to provide requested information.
Government Policy & Unchanged Fees
It remains government policy that supervised businesses should pay for supervision costs rather than having these funded through general taxation. The increases align with HMRC’s commitment to strengthening anti-money laundering supervision and tackling non-compliance.
The approvals fee will remain unchanged at £40. This fee applies to all beneficial owners, officers and managers in supervised sectors who must undergo an approvals check to ensure they are suitable for their roles.
HMRC is not currently restructuring its overall fee model, though points raised during consultation about fee structures will be considered in future reviews. Some suggestions about changing transaction thresholds have been passed to HM Treasury for consideration.
Official Resource
Full details of the fee changes are available in HMRC’s consultation response document on GOV.UK. Businesses can also access guidance on fee calculations and eligibility criteria through their HMRC online account.
For information about the small business fee reduction scheme, visit: HMRC’s anti-money laundering (AML) supervision fees: responses and next steps – GOV.UK
Conclusion
The revised fees take effect from 1 December 2025. While HMRC made concessions following consultation, including reducing the fit and proper test fee by £200 and the application fee by £100, the core increases proceed largely as proposed.
The changes represent the first adjustment since May 2019 and broadly align with cumulative inflation over those six years. Accountancy firms and other supervised businesses should prepare for these increased costs and explore whether they qualify for available reductions.
With fewer than half of eligible businesses currently claiming the small business fee refund, many firms may be paying more than necessary and should verify their eligibility status before the December deadline.
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