Making Tax Digital (MTD) for Income Tax is forcing a pricing reset across the profession.

You’re being asked to do more work, and more often, with tighter deadlines.

Meanwhile, your clients still expect fees that were set for a once-a-year service.

In this article, we explore how MTD for Income Tax pricing needs to change in response, looking at why traditional annual fee models no longer hold up, and how you can rethink pricing in a way that’s fair to clients and sustainable for your practice.

Here’s what we discuss:

Why MTD has made pricing unavoidable

For years, income tax pricing has been built around an annual event.

Records came in, work ramped up, returns were filed, and fees followed a familiar rhythm.

We don’t need to remind you that MTD changes that completely. You’re now expected to engage with client data throughout the year and submit updates at least every quarter (although more frequent is better!).

More than this, quarterly updates mean you must maintain a high standard for record quality on an ongoing basis.

That shift has exposed a growing gap between the work being delivered and the fees many practices are charging.

You might already feel this in your practice, with capacity feeling tighter, deadlines arriving all the more frequently, and teams managing multiple submission windows rather than one intense period of work.

At the same time, clients see tax as something that happens once a year.

Avoiding a pricing conversation doesn’t make this easier. It simply pushes the pressure onto your people and your margins.

Understanding what quarterly updates actually involve

Quarterly updates aren’t a full tax return but, in the same breath, they aren’t a light touch exercise.

Each submission still requires records to be acquired, then reviewed. Figures need to be sense-checked and errors to be corrected before anything is filed.

When you multiply that effort across dozens or hundreds of clients, the time commitment becomes significant very quickly.

It might not be just the quantity of work that’s problematic. Even if each update takes a relatively small amount of time, completing them all within fixed submission windows places real strain on systems and staff.

And that’s before you factor in chasing missing information, answering client questions, or dealing with poor quality records.

Some firms have questioned whether it’s acceptable to take a relaxed approach during HMRC’s penalty grace period. This means HMRC will not penalise late quarterly updates in the first year.

This is not a solution. Quarterly updates remain a legal requirement, and knowingly failing to comply can breach your professional conduct rules (PCRT) as laid down by your membership organisation. Submitting figures you know aren’t accurate, or skipping updates altogether, not only puts your practice and job at risk. It undermines trust.

MTD requires proper processes and consistent delivery, and pricing needs to reflect that reality.

Why annual pricing no longer reflects the service you provide

When fees are tied to the annual tax return, much of the work you will do under MTD goes unseen and unpaid.

The effort is spread across the year, but income often isn’t, which creates pressure on cash flow and limits your ability to invest in people and technology.

There’s also a visibility issue. Clients see the final tax return but, depending on their service level, might not see the repeated work that happens behind the scenes throughout the year.

They don’t understand that five or ten phone calls chasing them for paperwork every three months is a drain on your resources—and therefore your bottom line. They only see the fact the quarterly update is completed.

Without context like this, price increases can feel sudden or unjustified from their perspective. But it’s very hard to explain and it’s where many pricing conversations stall.

You feel underpaid for the work involved, and clients feel surprised or frustrated by higher fees.

Moving away from annual pricing and towards a model that reflects ongoing service helps close that gap.

AI changes the economics of MTD work

AI is now a practical part of modern accountancy, particularly when it comes to handling the volume and frequency of MTD submissions.

And with MTD, it’s simply the only way forward.

AI reduces manual processing, improves record quality, and helps ensure updates are accurate and on time.

Sage’s MTD AI Agent is part of Sage for Accounting, and is designed to handle repetitive groundwork at scale. It can automatically segment clients based on complexity, set up tasks and reminders, chase documents, and flag potential issues early. It’s like having an additional member of staff dedicated to MTD.

None of this replaces professional judgement, but it frees your team to focus on review, advice, and client communication.

This has a direct impact on pricing. When routine work is handled efficiently, you can offer clearer packages, predictable fees, and better service without increasing headcount at the same rate as your client base.

It also strengthens your value story. Clients benefit from cleaner data, fewer surprises, and a smoother experience across the year, which makes pricing discussions far easier.

Rethinking MTD for Income Tax pricing

Many practices are moving away from annual fees towards monthly retainers that reflect year-round work. This aligns income with effort and makes costs easier for clients to plan for.

Tiered pricing is another common approach. Packages might be based on transaction volume, business complexity, or the level of support required. Clients who handle more themselves pay less, and those who want full support pay more.

Some firms are bundling advisory touchpoints into their MTD offering. Quarterly updates create natural moments to discuss cash flow, tax estimates, two or three-year projections, and business performance. Including these conversations within your pricing helps clients see clear value beyond compliance.

What matters most is that clients gain a clear understanding. Clients need to understand what’s included, what isn’t, and how their choices affect the fee.

Tools like GoProposal, now part of Sage for Accountants, can help formalise this through clear letters of engagement that set expectations from the start.

The Do It For Me client

Many small business owners are already accustomed to using technology, provided the tools are simple enough and training resources are available.

But as most accountants and bookkeepers know, there’s a stubborn minority of clients who are entirely the opposite.

We can call these Do It For Me clients. They prefer a hands-off approach and want an accountant to handle every aspect, including organising the data and reconciling against bank accounts. Above all else, these clients value the peace of mind that compliance is handled on their behalf.

It might surprise you but this approach is entirely possible for MTD for Income Tax.

An add-on for accountants and bookkeepers to use alongside AutoEntry’s data entry automation, and available within Sage for Accountants, AccountsPrep provides a central platform perfect for handling clients who don’t have or need a full ledger.

Accountants and bookkeepers can take bank statement data as the source of truth, and scan in the data via AutoEntry. They can then quickly use AccountsPrep to sort, categorise and prepare to trial balance without the need for the back and forth to the smallest of clients.

For example, clients need only output three months of bank statement PDFs each quarter for the quarterly update. They can do this using their banking app. Once the accountant or bookkeeper receives these, then reconciling in a way fully compliant with MTD can take minutes.

Together, AutoEntry and AccountsPrep provide a robust, integrated approach to MTD (and Self Assessment), simplifying financial administration and enhancing data accuracy for every one of your sole trader and landlord clients.

Example of MTD pricing tiers you can adapt

It’s one thing to say pricing needs to change, but understanding what that actually looks like in practice is another.

Many firms are now structuring their services in tiers as a way to anchor value properly and make higher levels of support feel justified.

Here’s a practical example you could adapt to your own client base.

Bronze: Compliance only

Designed for confident DIY clients who are comfortable using software and keeping their records up to date.

• Client maintains bookkeeping within agreed software
• You review records quarterly
• You submit quarterly updates
• Basic end of period adjustment
• Email queries only
• Monthly fee from £35 to £50 plus VAT, plus software
• Final year end tax return priced separately

Silver: Compliance plus light support

Suitable for small sole traders or landlords who want more reassurance.

• Bookkeeping support for simple businesses
• Quarterly review and submission
• Basic tax estimate after each quarter
• Limited phone or email support
• Clear turnaround expectations
• Monthly fee from £65 to £85 plus VAT, plus software
• Final digital tax return priced separately

Gold: Compliance plus proactive advisory

Designed for growing sole traders, multiple property owners, or more complex affairs, with a full oversight and forward-planning view.

• Full quarterly bookkeeping
• Quarterly updates submitted
• Quarterly cash flow and profit summary, or even two or three-year projections (tip: Futrli by Sage is ideal for this)
• Tax estimate and planning conversation
• Priority support
• Ongoing advisory input
• Monthly fee from £100 to £150 plus VAT, plus software
• Final digital tax return included or priced at a reduced rate

Why tiers work psychologically

Tiered pricing does two important things:

First, it reframes the conversation from “why are fees going up?” to, “which level of support do you want?”, shifting control to the client while maintaining your boundaries.

Second, it makes mid and higher tiers feel reasonable.

If Bronze looks lean and self-managed, Silver and Gold feel supportive and safer.

Even if you expect most clients to choose the middle option, the structure guides that decision.

A few practical tips before you implement tiers

Here’s what to bear in mind:

• Be explicit about software requirements. Limiting bookkeeping platforms reduces chaos and protects your margins. Tip: With Sage for Accountants, you can offer Sage Accounting to clients while receiving a significant RRP discount that grows with the more subscriptions you add to your plan.
• Separate the final tax return clearly so there’s no confusion about scope.
• Review pricing after year one. MTD workflows will evolve and your fees should reflect real experience, not guesswork.
• Don’t underprice quarterlies. Even small per-quarter fees add up quickly across your client base.

Most importantly, align pricing with capacity.

If you don’t have the team to deliver high-touch support at scale, your Gold tier needs to be priced accordingly.

Using MTD to strengthen your service offering

MTD gives you more frequent insight into your clients’ financial position, and that visibility creates opportunities to add value in practical, meaningful ways.

You might offer simple quarterly tax estimates, cash flow snapshots, or management summaries that help clients plan ahead.

These don’t need to be complex advisory projects to make a difference. Even small insights can shift how clients perceive your role.

For some clients, MTD will highlight a need for more support. For others, it may confirm they’re comfortable doing more themselves. Both outcomes are useful. They allow you to segment your client base and focus your time where it has the greatest impact.

Over time, this leads to a more resilient practice with clearer positioning and healthier margins.

Communicating MTD value in a way clients understand

Most clients don’t care about the mechanics of quarterly submissions. They care about outcomes.

When you talk about pricing, focus on what they gain: better visibility of their tax position, fewer unexpected bills, more confidence that they’re meeting their obligations, and less stress at year end.

Be open about why fees are changing. Explain the additional work involved and the systems you’re using to deliver it efficiently. Position MTD as a service you’re managing on their behalf, not an inconvenience you’re passing on.

You are the gateway to HMRC for clients, and you’re helping clients comply with an HMRC requirement.

Starting these conversations early gives clients time to adjust and reduces friction later.

Managing price increases with existing clients

Price increases are easier to handle when they’re planned rather than reactive.

Ideally, you introduce new pricing structures before clients are mandated into MTD, with a clear explanation of how the service is changing.

“Early bird offers” that are discounted slightly from your usual rate for 12 months will boost sign-up rates and minimise any client urge to shop around (although you should highlight that, because you already manage their accounting data and know it well, your practice can make the transition to MTD as seamless as it can be).

Some practices phase increases over the first year, while others introduce new packages and allow clients to choose their level of support. There’s no single right approach, but consistency and transparency matter.

When clients push back, return to the service you’re providing and the risks you’re managing for them. If a client genuinely doesn’t see the value, that can prompt a useful conversation about fit.

Final thoughts

MTD has accelerated pricing discussions many practices needed to have anyway.

It has changed the nature of Income Tax compliance, and pricing models built around a single annual task no longer reflect the work involved.

With the right structure, the right use of AI, and clear communication, MTD can strengthen your practice rather than strain it. It gives you an opportunity to modernise pricing, improve service quality, and build a more sustainable business.

Handled well, MTD can become more than just a regulatory obligation, and also a key foundation for growth.

Payroll tax can be calculated manually, but thankfully we have software to help make it easier.

Payroll tax is a notoriously confusing area for small business owners, especially those new to managing employees. Getting it wrong can lead to penalties, employee dissatisfaction, and a lot of wasted time.

In this comprehensive guide, we break down the process of calculating payroll tax in the UK, and provide clear explanations and practical advice to help you navigate the complexities of the Pay As You Earn (PAYE) system, National Insurance contributions (NICs), and other deductions.

Here’s what we cover in this article:

What are payroll taxes?

In the UK, payroll taxes typically refer to the amounts you deduct from your employees’ wages and pay on their behalf to HMRC.

This includes income tax under the PAYE system, and National Insurance contributions (NICs). Essentially, these taxes fund things like the NHS, state pensions, and other public services.

PAYE is HMRC’s core system for calculating and collecting income tax and NICs directly from anyone formally employed.

As an employer, when managing payroll you’ll be dealing primarily with these two components. But there might be other deductions too, depending on your employee’s circumstances.

Parallel to the payroll tax deducted from employees, you as the employer must also pay certain contributions calculated in proportion to the employees’ wages.

This mainly refers to your own employers’ National Insurance contributions, but in some situations includes the Apprenticeship Levy (which will evolve into the Growth and Skills Levy). More on that later.

If you don’t fully understand how these taxes and the PAYE system work, you risk incurring penalties.

But don’t worry, as further on in this article we’ll explain how to keep your business compliant.

Manual payroll tax calculation: Step-by-step process

Deducting payroll tax is part of being a responsible employer, and there’s a thriving market in software to help you do it.

But if yours is a very small business or a start-up, you might not have sufficient budget for purpose-built software.

In that case, you’ll want to know how to calculate payroll tax yourself. It’s fairly simple maths: just a matter of following the right sequence, double-checking your figures, and keeping detailed records.

And HMRC offers various free PAYE calculators, which are ideal for individuals or small employers. The basic sequence is:

• Gather each employee’s pay details
• Work out their gross pay for the period
• Calculate the income tax and National Insurance due
• Check for other contributions that have to be deducted
• Register your employee’s net pay figure, including extras such as commissions
• Notify HMRC.

Now, we’ll go through these points one by one:

1. Gather details

The obvious starting point is the amount you paid your employee. But there are other details that you’ll need on hand:

• Gross pay is the total amount your employee earns before any deductions.
• Employee tax code specifies their personal allowance, the amount they can earn before paying income tax. Each employee’s personal allowance depends on whether they have additional sources of income, or whether they’re married, among other factors.
• Tax band, which means the tax calculation category your employee falls into depending on the total amount of taxable income they earn. It determines the percentage of taxable income that will be withheld as tax.
• Payment date and period covered. This is not always a full month. Some contracts may specify alternatives such as weekly or biweekly.
• Taxable income, such as the portion of gross pay that’s subject to income tax, calculated after deducting the personal allowance.

The final point, taxable income, may be further reduced by other tax-free allowances or expenses that can be excluded.

“Tax-excluded expenses” is a bit of a misnomer because it makes it sound like they’re tax-free at the time of spending.

The tax-free part in fact refers to a waiver on the amount you reimburse to the employee after they claim their expenses. That reimbursement is technically part of their pay, but it’s tax-free.

Expenses that fall within this bracket include:

• Travel expenses, including accommodation, fuel or public transport
• Business equipment, such as laptop or phone
• Working from home costs, such as internet access
• Entertainment, such as a formal dinner for meeting clients

2. Calculate income tax

Here, you’ll refer to the tax band mentioned above—your highest-earning employees will pay tax at a higher rate than those earning basic pay.

HMRC provides tax calculators and tables that tell you the relevant tax rate for each tax band. Alternatively, you can look up the rates on the HMRC website.

These are the figures for the 2026/27 tax year in England, Wales, and Northern Ireland:

It’s worth noting that, although the Welsh government has the ability to change income tax rates, it has kept them aligned with England. However, this could change in future.

These are the figures for the 2026/27 tax year in Scotland:

Across the UK, an individual’s personal allowance goes down by £1 for every £2 of net income that’s above £100,000. This effectively means that the personal allowance drops to zero if their income is above £125,140.

In all cases, both the allowance and the tax band (in effect, the tax rate) determine how much of an employee’s gross pay will be removed for tax.

Applying a percentage to a single figure is easy enough. But when you do this for lots of employees, it’s easy to slip up.

Keep a record of your calculations, as you’ll need to report these figures to HMRC, and if there’s an anomaly they will be able to spot where it occurred.

3. Calculate National Insurance contributions (NICs)

Both you and your employee pay NICs. But, as with income tax bands, the actual amount deducted varies from person to person.

The rate of NICs is “reserved”, meaning the UK parliament sets them and they do not change depending on whether you live in England, Scotland, Wales or Northern Ireland—unlike Income Tax, as we discussed above.

Your employees’ contributions depend on their earnings and National Insurance category. Again, HMRC’s NIC calculator comes in handy for working out the correct amounts.

For the 2026/27 tax year, there are over a dozen employee NIC calculations, reflecting age or whether they served in the armed forces, for example. And then for each category there are different tiers of percentage rates reflecting the amount earned.

Confusingly, HMRC refers to these as thresholds, rather than rates or bands.

You’ll calculate NICs based on each employee’s gross earnings above the primary threshold, which is the limit at which pay-based NIC contributions kick in.

For your own NIC calculation (employers’ NIC), in addition to the earnings-based component, you could incur NIC contributions on perks you give to your employees, such as a company car or phone, on the compensation they receive if they’re made redundant, and even on awards they receive for sporting activities. Note that benefits in kind (BIKs) become a mandatory part of payroll as of April 2027.

4. Deduct other contributions

Besides income tax and NICs, you might need to deduct other contributions from your employees’ pay.

These could include:

• Student loan repayments
• Pension contributions
• Holiday pay

Note that payments for maternity/paternity leave are not classed as deductions.

If an employee is repaying a student loan, the instalments due are usually based on their earnings, so it makes sense that the employer has to take care of that.

Pension contributions can be either automatic (auto-enrolment) or voluntary. In the former case, it’s the employer’s responsibility to ensure that payments are made.

In the latter, the employer is under no obligation, but may decide to take care of it since the channels are already in place. They may even decide to match the employee’s voluntary payments.  

An extreme case of an additional deduction is when an employee has defaulted on some debt—such as council tax or child maintenance—and a court rules that payments should come directly out of their pay. This is known as an “attachment of earnings” order.

5. Calculate net pay

Net pay is what your employee takes home after all deductions. It’s what’s left after you’ve subtracted income tax, NICs, and any other contributions from their gross pay.

However, it should also include any overtime, bonuses, commission, and statutory payments on top of the agreed regular wages or salary.

This is the amount you pay into each employee’s bank account.

It’s a legal requirement that the payslips you provide clearly show all deductions. This not only helps employees understand their earnings, but is good practice all round, promoting transparency.

6. Notify HMRC and issue payslip

The PAYE system requires that you report these figures to HMRC on or before the day you pay your employees.

HMRC’s standard document for this is the Full Payment Submission (FPS), which you can submit online or through payroll software. This is a legal requirement, detailing the payments and deductions made.

The law also requires that you provide each employee with a payslip that clearly shows their gross pay, all deductions (income tax, NICs, student loan repayments, pension contributions, and so on), and their net pay.

This helps employees understand how their pay is calculated.

How much is employer tax?

As an employer, you have your own tax obligations. You’ll pay employers’ National Insurance contributions, which are based on your employees’ combined earnings, above a certain threshold.

For the 2026/27 tax year, employers pay NICs at a rate of 15% on employee earnings above £5,000 per year (£96 per week). This is calculated based on gross earnings, before the employees’ NICs are deducted.

You may claim up to £10,500 Employment Allowance. Note that the previous £100,000 NIC liability eligibility cap was removed from April 2025, which meaningfully expands what you might be able to claim.

Note that not all employers are eligible—for example, sole directors of limited companies are usually not eligible.

Also, the calculations for employers’ NICs will vary based on factors such as your employees’ age and employment status. You can find the latest rates and thresholds on the HMRC website.

If your annual payroll bill exceeds £3 million, you’ll also have to pay the Apprenticeship Levy/Growth and Skills Levy, which is charged at 0.5% of your monthly pay bill. The government then puts this money towards apprenticeship training schemes across the UK.

Common payroll tax calculation mistakes

Even with careful attention, mistakes can happen if you manage your payroll documentation manually.

Common errors include:

• Using outdated tax codes or rates: regulations, official guidelines and HMRC methodology are subject to change, so it’s easy to fall behind on the latest updates. You can stay on top of the correct tax codes and rates by subscribing to HMRC email alerts or regularly checking its website for updates. If you use payroll software, make sure it’s up to date.
• Incorrect calculation of NICs: in the above sections, we glossed over the true complexity of the different NIC categories and thresholds—that’s a separate article in itself. It can be a minefield of potential errors due to misinterpreting the rules or using incorrect thresholds. Double-check your calculations against HMRC’s NIC tables, use online calculators, or seek professional advice if you’re unsure about the correct categories and rates.
• Overlooking other deductions: while employees should keep you informed about their circumstances, it’s ultimately your responsibility to ensure you have accurate and up-to-date information. So it’s also down to you to be aware of other deductions such as student loan repayments or pension contributions. Don’t just focus on the main deductions like income tax and NICs. Implement a system for regularly collecting and updating employee data, such as an employee self-service portal or periodic reviews, based on a checklist of all possible deductions. Those details can later be plugged into payroll software for rapid calculation of the right deduction types.

If you do find a mistake, correct it immediately and inform HMRC so you avoid penalties or employee disputes.

Penalties and fine print to be aware of include:

• Late filing: £100 or more per month, depending on the size of your payroll.
• Late payment: starting at £100 per late submission, but can vary depending on the specific circumstances and the lateness of the payment. They also carry interest, typically at 2.5% above the Bank of England base rate.
• Compliance checks: HMRC can inspect your records and impose further penalties for underpayment or non-compliance.

Tools to simplify payroll tax calculation

Thankfully, there are many tools available to simplify payroll tax calculations. Payroll software can automate calculations, generate payslips, and submit reports to HMRC.

These tools, together with HMRC’s online calculators and resources, can save you time and reduce the risk of errors.

Consider using a cloud-based payroll system for easy access and updates.

If you’re new to payroll, don’t hesitate to seek professional advice. An accountant or payroll specialist can provide valuable support and ensure you’re compliant.

Accurate and fast payroll tax calculation is key

A good understanding of the different components of payroll tax ensures that your employees are paid correctly and that your business remains compliant with HMRC regulations.

Whether you choose to calculate payroll manually or use HMRC-compatible payroll tax software, there’s no escaping the need to stay informed and organised, because accuracy is the key to avoiding unexpected costs.

Don’t be afraid to outsource this task to people in the know or simplify the process by investing in the best tools available.

Your people may have been informally automating for years—copying and pasting between systems, building workarounds in spreadsheets, reusing old emails, or finding the quickest way to get something done when your software didn’t quite fit.

The problem is that this kind of automation is invisible, inconsistent, and often relies on senior people’s time.

It’s also very easy to get stuck in “AI research mode”, where you’re reading, watching demos, and experimenting, without seeing meaningful results in your day-to-day practice work.

The fastest way out of that loop isn’t a big transformation project. It’s picking one or two workflows that you know are quietly draining your time every week and fixing those first.

This article focuses on what to automate first. Not in theory, but in the next 30 days.

Here’s what we cover:

Start with time, not technology

Before thinking about tools, ask yourself and your team a simple question: where does time quietly leak out of your practice every week?

It won’t be the big, strategic work. Not advisory conversations. But the surrounding friction.

Often, your time drains live in the gaps between systems and people:

• Chasing missing information from clients
• Reformatting or extracting data from emails, PDFs, and spreadsheets
• Rewriting proposals from notes, calls, or memory
• Setting up jobs, reminders, and follow-ups that already feel repetitive
• Updating multiple systems that don’t quite talk to each other

None of these tasks are difficult. But they’re constant.

And because they sit between “real work,” they’re rarely tracked, priced, or challenged.

Some accountants describe this as “death by handover,” where you see information moving from WhatsApp to email, from email to practice software, from practice software to spreadsheets, with small delays and rework at every step.

That’s why these types of workflows are the best place to start:

• The risk is low (you’re not automating judgment or advice)
• The time cost is high (they happen every day, for every client)
• The impact is immediate (less chasing, less copying, less mental load)

If you review your processes, it’s unlikely you’ll discover new problems. Instead, you’ll notice how much time you’re already spending working around your systems.

Once you see that, the maths becomes hard to ignore.

Saving, for example, 10–15 minutes a day doesn’t sound dramatic until you add it up.

12 minutes a day ≈ 1 hour a week ≈ 48 hours a year, per person, per task

Multiply that across a team, multiple workflows, and a year—suddenly AI stops being about cool innovation.

It becomes about getting your time back. This is where AI earns its keep.

If you want a clearer picture of what AI can realistically handle in an accounting or bookkeeping firm today—without the hype—the Start Strong with AI Guide for Small Business breaks down practical use cases, limitations, and where AI genuinely fits into everyday work.

Top 3 workflows to automate

Here are the top three workflows to automate.

1. Client chasing and reminders

Chasing clients for missing information may be one of your biggest hidden drains on time and energy.

It sits in the “friction” category of practice work: the small, repetitive gaps between systems and people where time quietly leaks away every week.

These micro‑tasks aren’t difficult, but they’re constant, untracked, and mentally exhausting.

AI-assisted workflows help reduce that friction by automating the repetitive parts of the process. They can:

• Generate reminder messages automatically
• Adjust tone (polite, firm, final reminder)
• Trigger follow-ups when documents are missing
• Notify you when human judgment is needed

The key point is that you keep full control. AI shouldn’t decide who to chase or what’s acceptable, but it could and should stop you from writing and sending the same message over and over again.

That shift from manual repetition to automated consistency is where your firm can start to feel the impact immediately.

This is also one of the clearest examples of a “low‑risk, high‑frequency workflow”: a task that happens daily, carries no judgement, and delivers instant time savings once automated.

Real businesses are already seeing this reduction in admin.

For example, Tyne Chease saved around 14 hours a week on admin after introducing automated invoice-related follow-ups through Sage Accounting and Copilot—demonstrating how even simple, consistent reminders can transform workloads.

Client chasing is often the fastest “30-day AI win” because it doesn’t change the substance of the work—just the process—letting you spend less time sending emails, and more time on the work only you can do.

2. Proposals and engagement letters

Proposals quietly consume more senior time than you realise.

They don’t arrive often enough to feel like a broken system—but when they do, they usually land with partners or senior managers. Not because the work is complex, but because it requires judgement, context, and confidence.

The pattern is familiar:

• Notes taken during a discovery call
• A delay while other work takes priority
• A proposal written from memory, emails, or half-complete notes
• Multiple revisions to get scope, tone, and pricing right

As practitioners put it: “High-value thinking wrapped in low-value execution.”

Here, AI shouldn’t replace your judgment, but it can remove the blank page.

Used well, AI can help you:

• Draft a first-pass proposal from discovery notes or call transcripts
• Pull in standard services, pricing bands, and engagement terms
• Format documents consistently
• Reduce turnaround time from days to minutes

That shift matters.

Instead of starting from scratch, you can start at 80% complete, allowing you to review and refine rather than recreate.

Speed also improves quality. Faster proposals mean:

• Better recall of client pain points
• Language that reflects the actual conversation
• Stronger momentum and higher conversion
• Less senior time lost to admin

Nothing is sent without human approval. AI accelerates preparation. People retain responsibility.

Where structured proposal tools fit: You can use tools like GoProposal by Sage to bring structure, consistency, and transparent pricing to proposals and engagement letters.

Accountants consistently complain that time sinks happen before they even open a system—pulling notes together, shaping scope, and drafting the first version.

This is where AI becomes an accelerator.

AI can draft the initial proposal content, while GoProposal ensures:

• Compliant engagement letters
• Consistent pricing
• Professional templates
• A standardised process for every prospect

The result is a joined-up workflow that removes low-value admin while preserving judgement, tone, and pricing integrity.

That combination is exactly what firms like Bee Motion have leaned into.

By systemising proposals and engagement letters as part of a wider workflow (reducing the manual effort around drafting), you can save significant time each day, increase average fees, and scale without losing control or burning out senior staff.

Don’t think about AI “writing proposals”. Think about removing friction so your experienced people can focus on higher-value work.

3. Data extraction and organisation

This is where your firm may feel strain every day.

Clients don’t send information neatly. They send it in whatever format is fastest for them:

• PDFs attached to emails
• Spreadsheets exported from other systems
• Photos of receipts taken on phones
• Bank statements forwarded via email or WhatsApp

By the time that information reaches your accounting system, it’s already passed through multiple inboxes, folders, and people.

Practitioners consistently describe this as the messiest handover in the firm. Not because the work is complex, but because it’s fragmented.

AI doesn’t fix this by replacing judgement. It fixes it by reducing manual movement.

Used well, AI tools can:

• Extract data from PDFs, images, and spreadsheets
• Categorise transactions based on context and history
• Store files automatically in the correct client folder
• Flag missing data or anomalies for review

The real shift isn’t speed. It’s where attention goes.

Instead of:

• Copying figures between systems
• Renaming and relocating files
• Checking whether something has been missed

Your team can move into an oversight role:

• Reviewing exceptions
• Validating unusual items
• Stepping in only when something doesn’t look right

As accountants put it: “I don’t want AI to be clever—I just want it to stop me touching the same data three times.”

When data arrives already structured and traceable:

• Errors fall
• Rework drops
• Handovers improve
• Senior staff aren’t pulled into basic clean-up

That’s why data extraction and organisation is often the fastest place to reclaim time—without touching advisory work, pricing decisions, or client relationships.

You don’t want to shut people out from the process, but you do want to remove friction from it.

A real world example

That shift is exactly what firms like Walter Dawson & Son have seen in practice.

By automating the collection and structuring of client data, you can cut hours of manual admin and redirect that time back into client conversations.

And instead of rekeying invoices or chasing paperwork, you can review clean, ready-to-use information.

As Managing Director Julie Young puts it, the time saved is now spent “reflecting on the numbers and talking to clients about how they’re actually performing.”

The outcome is a better use of expertise and more time where it matters most.

Why small automations work (and bigger projects often don’t)

Large AI initiatives often fail for reasons that have nothing to do with technology.

They tend to:

• Try to fix everything at once
• Assume clean, consistent data
• Require full team buy-in before anything can start
• Compete with day-to-day client work for attention

“System projects” often stall, not because the idea is wrong, but because no one has the time or headspace to carry it through.

AI can fall into the same trap when it’s framed as a transformation.

Small automations work for the opposite reason. You do the following:

• Solve an obvious, shared pain point
• Fit around existing workflows rather than replacing them
• Don’t rely on perfect data
• Show value quickly—often in days, not months

Small wins change behaviour

Instead of asking people to believe in AI, let them feel the impact.

• A reminder sent automatically.
• A proposal drafted in minutes instead of hours.
• Client data arriving already organised.

Those wins matter because they change behaviour.

Once people feel time coming back into their day:

• Resistance drops
• Confidence grows
• Experimentation feels safer
• Conversations shift from “should we?” to “what next?”

That’s the moment where bigger automation becomes realistic, not because a strategy document says so, but because your firm has proof it works in your own context.

In practice, sustainable AI adoption doesn’t start with ambition. It starts with relief.

A simple 30-day approach

You don’t need a long-term roadmap. You need to see progress in your own workflows.

That’s why the most effective AI adoption follows a simple pattern: notice → test → measure → repeat—the structure used in Sage’s AI Action Workbook.

Here’s what that looks like in practice.

Week 1: Notice where time goes

List the tasks you repeat every week—especially the ones you put off or dislike doing.
Invoice chasing. Proposal prep. Receipt handling. Data clean-up.

You’re not looking for the most important task. You’re looking for the most annoying one.

Week 2: Pick a low-risk starting point

Choose one task that:

• Takes at least 10 minutes
• Happens frequently
• Doesn’t require judgement or client-facing decisions

This mirrors the workbook’s focus on process readiness—starting where habits already exist, rather than forcing change.

Week 3: Test one AI-assisted workflow

Use the tools you already have where possible.

Automate part of the task, not all of it.

The goal isn’t perfection.

It’s reducing effort—fewer clicks, fewer handovers, fewer interruptions.

Week 4: Measure, refine, and lock it in

Roughly estimate the time saved.

Document the steps.

Decide whether to keep it, tweak it, or drop it.

This is where confidence builds—because you can see the impact in real terms, not just dashboards or demos.

That’s it.

No replatforming.

No “AI strategy deck.”

No big announcement to your team.

Just time quietly coming back into your day—and a clear signal about what to automate next.

Final thoughts: AI won’t replace you, but it will change the way you work

It should be obvious now that AI doesn’t remove the need for professional judgement. If anything, it makes your judgment more valuable.

You won’t win by chasing the latest tools, but you will if you quietly remove friction from everyday work.

Start small. Automate what wastes time. Let results, not hype, decide what you do next.

If you want to pick one automation to implement in the next 30 days, the AI Action Workbook helps you choose, plan, and start—without turning it into a big project.

For too long, hiring has been treated like a numbers game. Post a role. Sort through hundreds of CVs. And hope the right person stands out.

But for many UK employers, especially small and medium-sized businesses, the reality looks very different. 

Traditional recruitment is slow, expensive and biased towards outdated credentials. We found that 3 in 4 businesses say recruitment is a challenge, and 45% of businesses now spend more on recruitment. Worse still, it often fails to deliver people with the practical skills businesses actually need.

When every hire matters, the traditional hiring approach can become a real barrier to growth. That’s why many employers are rethinking how they attract, develop and retain people; not by replacing hiring altogether, but by complementing it with more structured, skills-focused pathways.¹

Apprenticeships offer a practical, proven way to develop talent from the ground up, helping employers build the skills they need while creating meaningful, long-term opportunities for people.

Why employers are rethinking traditional hiring

Hiring is becoming more complex for UK employers. Skills shortages are increasing, competition for talent is intensifying and recruitment budgets are under pressure. 

At the same time, heavy reliance on CVs and formal qualifications can narrow the talent pool too early. This approach often prioritises academic pathways over practical capability, meaning employers may overlook candidates with the right mindset, adaptability and potential to grow into the role.

As businesses focus on building resilient, future-ready teams, many are starting to explore new ways of finding and developing talent that better reflect how work actually happens today.

Once viewed as a less traditional career route, apprenticeships are now helping SMEs bridge the gap between on-paper qualifications and day-to-day job requirements. Training remains essential regardless of experience level, and apprenticeships allow employers to build those skills in a structured, supported way.

Perceptions are shifting. Employment Hero research shows that 78% of business leaders now hold a positive view of apprenticeships, pointing to the rise of a blended talent model. Nearly half of SMEs (46%) now place greater value on vocational routes, while just 11% still see apprenticeships as less valuable.

This momentum is set to continue. Our research found that 73% of SME leaders plan to make use of new government apprenticeship schemes following the 2025 Autumn Budget, with 78% of employers already report productivity gains from apprenticeship programmes.

The impact goes beyond individual businesses. By creating accessible pathways into work, apprenticeships also play an important role in tackling youth unemployment across the UK.

What is an apprenticeship?

Apprenticeships are structured training programmes that combine paid, hands-on work with formal off-the-job learning.

They are available across a wide range of industries, including technology, HR, finance, marketing and professional services.²

Unlike traditional recruitment, apprenticeships are designed around development. Apprentices join your business to learn, supported by a clear training plan that focuses on the skills your organisation actually needs.

Instead of searching for the finished product, you build it.

How apprenticeships solve hiring challenges

Apprenticeships do more than fill vacancies. They address the root causes of many modern recruitment problems. Let’s take a look.

Reducing bias in recruitment

CV-led hiring favours candidates who know how to present themselves on paper. Apprenticeships shift the focus to potential.

By recruiting for attitude, motivation and willingness to learn, employers open their doors to a wider and more diverse talent pool. This creates fairer access to opportunities while helping businesses benefit from new perspectives and ideas.

Building job-ready skills

Apprentices learn in the context of your business. Training is aligned to real responsibilities, processes and systems. This closes the gap between theory and practice and produces employees who are genuinely job-ready, not just qualified.

Over time, apprentices develop into highly capable team members who understand how your organisation operates because they have grown within it.

Creating a long-term talent pipeline

Constantly recruiting for the same roles is costly and unsustainable. Apprenticeships allow employers to grow talent internally, creating a reliable pipeline of skilled employees who can progress as the business evolves. This reduces reliance on external recruitment and protects against future skills shortages.

A structured onboarding process plays a critical role here, helping apprentices settle quickly and feel supported from day one.

Attracting overlooked talent

Apprenticeships appeal to candidates who may be excluded by traditional hiring routes. Career changers. Parents returning to work. School leavers choosing an alternative to university.

By offering paid, supported entry into your industry, you make your business accessible to people with valuable life experience and transferable skills. These candidates are often highly motivated and deeply committed to their employers.

Improving retention and engagement

Employees who are developed internally tend to stay longer. Apprenticeships build loyalty by showing people there is a future for them within your organisation. Clear progression pathways, structured learning and ongoing support all contribute to higher engagement and lower staff turnover.

How to get started with apprenticeships

Employment Hero data shows that 43% of employers find navigating the apprenticeship system complex, highlighting a key barrier to wider adoption. Understanding funding rules, training requirements and compliance can feel overwhelming, particularly for time-poor SMEs.

The good news is that getting started does not have to be complicated.

Start with a clear skills need

Begin by identifying roles where practical skills gaps already exist or where future demand is likely to grow. Starting with one or two well-defined positions makes it easier to design meaningful training and see results quickly.

Partner with the right training providers

Registered training providers and colleges manage the formal learning and assessment elements of apprenticeships. Working with experienced providers helps ensure programmes meet national standards while reducing the administrative burden on your business.

Understand the funding available

Government funding covers a significant portion of apprenticeship training costs, but navigating eligibility and claims can be challenging. Taking the time to understand what support is available, or working with partners who can guide you, makes apprenticeships far more accessible and cost-effective.

• Apprenticeship Levy funding – Large employers with an annual payroll over £3 million pay into the Apprenticeship Levy and can use those funds to cover training and assessment costs. Importantly for SMEs, levy-paying organisations³ can transfer unused levy funds to other businesses, helping smaller employers access fully funded apprenticeships without paying the levy themselves.
• Government co-investment for SMEs – Most small and medium-sized businesses do not pay the Apprenticeship Levy. Instead, they benefit from government co-investment, where the state covers the majority of training costs and the employer pays a small contribution. This makes apprenticeships a far more affordable option than traditional recruitment or external training.
• Employer inventive payments – From time to time, the government offers employer incentive payments, particularly for hiring younger apprentices, new starters or individuals with additional support needs. These payments are designed to offset onboarding and training costs during the early stages of employment.
• Fully funded apprenticeships for young learners – In many cases, apprentices aged 16–18 are fully funded, meaning employers do not contribute towards training costs at all. This makes apprenticeships an accessible entry point for businesses looking to develop early-career talent.

Simplify the experience with technology

Managing apprenticeships becomes far easier when processes are centralised. HR software can support onboarding, track training progress, manage performance reviews and keep records organised, helping employers stay compliant while giving apprentices a smooth, supported experience.

With the right structure and support in place, apprenticeships become a practical, scalable way to build skills rather than an administrative burden.

Ready to strengthen your hiring and development strategy?

Traditional hiring alone is no longer enough to meet today’s skills challenges. Apprenticeships don’t replace recruitment entirely, but they do offer a powerful way to complement it,  helping businesses grow talent internally, build capability over time and create more resilient teams.

At Employment Hero, we help employers manage and support their people at every stage of the employee lifecycle. From onboarding and training to payroll and performance management, our all-in-one platform gives you the foundations you need to build successful apprenticeship programmes with confidence.

References

1. Work That Works, Employment Hero commissioned research with QuestionPro, UK, March 2025, n=1200 (employees in companies of 5-999 people)
2. Employment Hero commissioned survey with Focaldata, UK, January 2026, n=1,047 business owners/leaders in SMEs. Data based on a bespoke survey of 1,047 UK business owners/leaders at SMEs, commissioned by Employment Hero and conducted by Focaldata in January 2026.
3. Employment Hero commissioned survey with Focaldata, UK, January 2026, n=1,047 business owners/leaders in SMEs. Data based on a bespoke survey of 1,047 UK business owners/leaders at SMEs, commissioned by Employment Hero and conducted by Focaldata in January 2026.

London, 12 February 2026: This Valentine’s Day, Employment Hero, the global leader in HR, hiring and payroll software, is celebrating the heart of the UK economy: British small and medium-sized businesses (SMEs).

New research commissioned by Employment Hero, surveying 1,047 UK business leaders, reveals that running a business is truly a labour of love. Despite significant personal sacrifices, 85% of SME leaders say that if given the chance to turn back the clock, they would do it all over again.

The findings highlight the personal cost of entrepreneurship. Almost all SME leaders (94%) say they have made sacrifices because of their business. Two in three (67%) report sacrificing time for themselves, while over half (55%) say they have sacrificed time with their partner.

Yet despite these pressures, business ownership remains deeply meaningful. When asked how running a business makes them feel, SME leaders most commonly cited purpose, fulfilment and pride.

Resilience in the face of adversity

The research follows a challenging period for SMEs, marked by the impact of measures introduced in the 2024 Autumn Budget. Throughout 2025, higher National Insurance Contributions and new employment law changes weighed on business confidence and hiring decisions.

This is reflected in the national employment picture. Latest ONS figures, which largely reflect the trends of large businesses, show payrolled employees fell by 184,000 (0.6%) year-on-year by December 2025, while unemployment rose to 5.1%, the highest level since 2021. 

However, Employment Hero’s SME labour market data tells a different story.. Analysis of real-time employment data from 117,000 employee records shows SME hiring increased by 2.5% year-on-year by the end of 2025. The data also highlights the impact of policy uncertainty: month-on-month employment growth fell to 0.8% in December 2024 following the announcement of NIC increases and to -1.1% in April 2025 when the changes came into effect. Despite this volatility, British small businesses have continued to take risks and provide employment opportunities.

Giving back to the community

To celebrate the heart of the UK economy and the vital role small businesses play in local communities, Employment Hero and their mascot Big Ears will be handing out letters of appreciation at the England v Scotland match on 14 February, encouraging fans to show support for their favourite small businesses this Valentine’s Day.

Commenting on the research, Kevin Fitzgerald, UK Managing Director at Employment Hero said:

“This Valentine’s Day, we wanted to shine a light on the real love story driving Britain’s economy – the unwavering commitment of small business owners to their companies and their teams. These are people who’ve sacrificed time with loved ones, personal wellbeing and financial security to build something meaningful.

“They’ve weathered one of the toughest years in recent memory, facing rising costs, policy uncertainty and a contracting national labour market. Yet our data shows they haven’t given up. While the broader economy has seen employment fall, SMEs have continued to take risks and invest in people.

“That 85% would do it all again speaks volumes about the resilience and determination of Britain’s small business community. Even when it costs time and relationships, the love for their business endures. That’s the kind of commitment worth celebrating and it’s why SMEs remain the beating heart of the UK economy.”

LONDON, 9 February 2026: The Government’s apprenticeship reforms could unlock a youth hiring breakthrough or fall victim to bureaucracy. New research from Employment Hero, the global leader in HR, hiring and payroll software, shows 73% of SME leaders are ready to take advantage of new support announced in last year’s Autumn Budget. The same data also reveals a warning sign: 43% say navigating the apprenticeship system is too complex, threatening to deter them from hiring.

With 872,000 young people currently not in education, employment or training (NEET) – the highest level in over a decade – apprenticeships represent a proven solution with 78% of employers having experienced increased productivity through apprenticeships. However, for the UK’s 5.7 million SMEs, the message is clear: financial support alone won’t drive uptake if administrative hurdles remain. 

A perception shift

The survey also highlights that the perception of entry level career paths has shifted, with 78% of leaders holding a positive view of apprenticeships. The data suggests a ‘blended’ talent model is emerging: 46% of SMEs value apprenticeships and degrees equally, while 37% now value the vocational route more, leaving only a small minority (11%) who view them as less valuable.

“73% of SMEs want to embrace the Government’s apprenticeship push. That’s great news and highlights that the apprenticeship reform has the potential to help solve the youth employment challenge that currently exists in the UK economy.” Kevin Fitzgerald, UK Managing Director at Employment Hero, said. 

“There is clearly an appetite from SMEs to give apprentices a key role in driving their businesses forward. This has to be matched by the Government to improve access and remove the unnecessary red tape that might hold SMEs back from the productivity gains on offer with the apprenticeship scheme.”

There’s a conversation happening in many accounting practices across the UK.

It’s happening over morning coffees, in partner meetings, and in the quiet moments between client calls:

“What do we do about AI?”

With Making Tax Digital (MTD) for Income Tax launching in just a few months, affecting 864,000 sole traders and landlords in its first phase alone, in these conversations you might also find a realisation being shared:

“I don’t think we can avoid AI any longer.”

And this is what we discuss in this blog, as follows:

3 types of practice, a shared challenge

The maths of MTD for Income Tax’s quarterly update and digital tax return workload is simple: one annual client interaction becomes five, each with its own data gathering requirements, deadline, and potential penalty.

It’s less about when you engage with AI, but whether you’ll do so on your terms—or be forced to react when you’re overwhelmed in a few months’ time.

Among other things at the upcoming Sage AI Roadshows, supported by AccountingWEB, the results of recent joint research will be revealed. It’s helped create three broad archetypes, as follows. Which best fits with you and your practice?

Strategic Adopters

These represent roughly 40% of practices. These firms have moved beyond simply sourcing and applying AI tools. They’re building systems. Isolated experiments have evolved into firm-wide implementations, automating the likes of client onboarding, document intake, and compliance workflows.

For these Strategic Adopters, the challenge is around optimisation: how do they scale what’s working, maintain data governance, and ensure their team keeps pace with the technology?

The danger for this group is complacency. Being ahead today doesn’t guarantee staying ahead tomorrow.

Cautious Observers

These make up another 40%. They see the potential of AI. They’ve perhaps experimented with tools like ChatGPT for drafting emails or summarising documents. But they haven’t made the leap to systematic adoption.

Their concerns are legitimate and revolve around reliability, accuracy, security, and professional standards. They want to know that AI won’t embarrass them in front of clients or create compliance risks.

What they need isn’t to hear yet more hype about AI’s possibilities. They need practical guidance on safe experimentation, clear use cases, and honest conversations about limitations.

Digital Traditionalists

These comprise the remaining practitioners. These people have seen technology trends come and go and they’re not opposed to change. They’re simply unconvinced that this particular change is necessary or beneficial for their practice.

Many run successful, established firms built on relationships and expertise. AI leaves them feeling ambivalent—it potentially threatens what they’ve built but it might also enhance it.

For this group, the starting point must be stress reduction and workload management, not transformation. They need to see AI as a tool that supports their existing strengths, not one that renders them obsolete.

Your invitation to act

Reading about AI adoption is no substitute for experiencing it.

That’s why Sage, supported by AccountingWEB, is launching AI roadshow events, beginning in March 2026 at Bristol, and continuing to Manchester and London events in April.

These events are definitely not sales pitches. The goal is practical, workshop-style sessions designed to meet you where you are. For example, you will leave with a structured 90-day playbook for practical AI adoption.

Each event features dedicated tracks tailored to different levels of AI readiness, led by a combination of Sage specialists, independent experts, and—crucially—your accounting peers who’ve already walked this path.

Strategic Adopters will find sessions focused on building strong data governance foundations, automating core practice processes end-to-end, and creating blueprints for firm-wide AI systems. This is where you move from isolated use cases to integrated operating models.

Cautious Observers will discover practical demonstrations of AI’s impact on everyday practice life—speeding up email drafting, summarising client calls, preparing queries before reviews, and improving routine admin. You’ll leave with clarity on where early wins can be achieved and practical guidelines for safe team adoption.

Digital Traditionalists will experience a confidence-building introduction focused on reducing stress and lightening workloads. You’ll see how basic tools can help manage tasks, plan workloads, and draft routine communications without disrupting what already works. Every attendee will leave with zero-cost use cases they can implement immediately.

Finding your starting point today

But what if you can’t wait?

The immediate path forward looks different depending on where you’re starting from, but certain principles apply universally.

Strategic Adopters: Your next frontier is systematic data governance and cross-practice integration. Individual AI wins are valuable, but firm-wide systems that maintain consistency, security, and quality control are what separate sustainable advantage from scattered experiments. Focus on creating operating models that scale, not just tools that work.

Cautious Observers: Your priority should be identifying two or three high-value, low-risk use cases where AI can deliver immediate benefits without threatening professional standards.

Email drafting via AI assistants like Sage Copilot, call summarisation, and working paper preparation are natural starting points. Establish clear guidelines for your team about appropriate use, then expand from there. The key is moving from passive observation to active experimentation within defined boundaries.

Digital Traditionalists: Start with pain points. What administrative tasks consume disproportionate time? What repetitive work could be streamlined without changing your fundamental approach to client service?

AI tools can handle routine communications, manage task scheduling, and create templates that preserve your voice and standards while reducing your workload. The goal isn’t transformation—it’s making each week feel lighter.

Final thoughts

Let’s be direct: attending an AI workshop is a professional necessity for anyone serious about their practice’s future. And it’s a great first step in any ongoing training. Events like the Sage AI Roadshow even deliver CPD.

The accounting profession has always adapted to change—from paper ledgers to spreadsheets, from desktop software to cloud computing. Each transition separated those who evolved from those who were left behind.

AI represents the most significant shift since the digitisation of records, but the timeline for adaptation is compressed. What took a decade with previous technologies has taken maybe a year or two with AI.

The Sage AI Roadshows offer something valuable: a structured opportunity to begin or accelerate your AI journey alongside peers who understand your challenges, supported by experts who can answer your specific questions, in a format designed for practical learning rather than theoretical discussion.

Whether you’re ready to scale existing AI implementations, prepare for cautious first steps, or simply want to understand what all the fuss is about, there’s a session designed for you.

Your people are probably using AI, whether your business has officially adopted it or not.

From drafting invoice reminders and summarising meeting notes in seconds, to getting help with prospecting templates or ideas, AI has crept into everyday work.

That’s the context for the AI Skills Boost, a UK government initiative designed to help millions of workers build practical, foundational AI skills by 2030. It’s delivered in partnership with major technology providers, including Sage.

It’s live right now. So, let’s take a look at what it could mean for you and your team:

What is the AI Skills Boost?

The question for most small businesses isn’t whether AI matters. It’s where to start, and how to embrace it without overwhelming your team.

AI Skills Boost is the answer. It’s available through the AI Skills Hub and is designed to help people understand and use AI productively, safely, and responsibly at work.

The pathway courses are designed for the real-world, in that they’re:

• Entry-level and non-technical
• Focused on productivity, not theory
• Free to access and self-paced
• Designed for everyday roles, not just IT teams

Individuals sign up directly through the AI Skills Hub and can choose from a range of options, some taking as little as 20 minutes to complete.

Completing the selected pathways also unlocks a digital AI skills badge, which learners can use on LinkedIn or email signatures.

Sage’s AI experience and expertise in the AI Skills Boost

As part of the AI Skills Boost, Sage has contributed an AI Fundamentals for Business pathway (note: free registration is required), which is included among the recommended foundational options on the Hub.

The pathway focuses on practical business scenarios, helping people understand where AI can support productivity and decision-making, as well as when it should (and shouldn’t) be used.

For small businesses already thinking about AI or unsure where to begin, it offers you a practical, low-risk starting point.

If you’d like a broader overview of how AI applies to small businesses (including common use cases and pitfalls to avoid) the Start Strong with AI for Small Businesses guide provides a simple introduction.

Why AI skills matter for your small business

There is no shortage of AI tools available to small businesses, but you may be uncertain.

Your team may worry about using AI incorrectly, may not know where it fits into their work, or may assume it’s only for the tech-savvy. Inevitably, you’ll end up with patchy adoption and miss opportunities.

AI Skills Boost is designed to remove that friction by:

• Building a shared baseline understanding across teams
• Increasing confidence in everyday AI use
• Helping businesses get more value from tools they may already have

In short, it’s about confidence before complexity.

What AI looks like in practice

In the Sage AI Action Workbook, there are examples of businesses that have made small changes to deliver fast, real results.

Tyne Chease, a UK food business, uses Sage Ai to support everyday finance tasks such as invoice chasing.

By automating part of a process they were doing manually, the business got paid up to seven days faster and saved around 14 hours of admin time every week.

There was no major transformation programme. No technical rebuild. Just one routine task improved with AI, resulting in clear, measurable benefits.

This is exactly what the AI Skills Boost is designed to support: helping teams see what’s possible, build confidence, and then decide what to do next.

How to use the AI Skills Boost effectively in your business

The programme works best if you treat it as a team-wide baseline, not a one-off experiment.

Use the AI Skills Boost by:

• Sharing the sign-up link internally
• Encouraging staff to complete a short foundational pathway
• Using it as a common reference point for future conversations about AI and digital tools

Because the training is flexible and self-paced, it can fit around busy schedules and helps those in your team start from the same understanding rather than learning in isolation.

How to get started with AI skills

AI adoption isn’t slowing down and it’s proving to be more than a flash in the pan.

Building foundational skills now means your team can adapt confidently, experiment responsibly, and make better decisions as tools evolve.

AI Skills Boost has arrived at just the right time. It’s free, flexible, and designed for real work, rather than abstract theory.

Start by exploring the AI Skills Boost on the AI Skills Hub, then dig down into Sage’s AI Fundamentals for Business pathway.

Employment Hero is prescribing a more productive approach to National Sickie Day.

The first Monday of February has a bit of a reputation and similar to Blue Monday, it’s not a good one. Widely known as National Sickie Day, it’s statistically the day when more UK employees are likely to call in sick than any other. 

For business owners and HR professionals it often becomes a familiar pattern each year; a spike in absence and a lingering suspicion that not everyone is genuinely unwell. Because, let’s face it, it’s rarely “just a cold”. More often, it’s a symptom of burnout, disengagement and depleted energy (at this time of year, when there’s little sun and days are still short, it’s not really a surprise, is it?). 

What is surprising, though, is how often these warning signs are ignored. Employment Hero’s Work That Works report found that employee wellbeing is the number one driver of productivity, yet days like National Sickie Day UK are still treated as an attendance issue rather than a wellbeing signal.

So what if we stopped treating National Sickie Day UK as a problem to be managed and started seeing it as a message to listen to? Instead of policing absence or bracing for staff shortages, forward-thinking HR teams can flip the script and use it as a catalyst to champion rest, flexibility and genuine connection. 

Why HR teams should rethink National Sickie Day

It’s time to stop playing cat and mouse with absenteeism. Instead of counting empty desks or tightening sickness policies, it’s a chance for forward-thinking HR professionals to get creative. And National Sickie Day UK is the perfect catalyst for a much needed wellbeing revolution. 

This revolution begins with understanding employee absenteeism and the reality is that “sickies” are often a survival tactic for employees running on empty.  Not convinced? We’ve got the numbers to back up this bold claim. In fact, Employment Hero data indicates that burnout is the real driver, with 28% of UK workers admitting to taking at least one sick day when they weren’t physically unwell and 17% taking more than one. When asked why, nearly half (49%) said they took a sick day because they felt mentally or emotionally exhausted, while 39% said they felt overwhelmed and needed a break.

So this leads to the bigger question of what is really causing this burnout. According to the data, in 2025 a quarter of employees didn’t use all of their allocated leave and 44% felt pressured to keep working during their time off. These stats are a sharp wake-up call. But by rethinking your approach to National Sickie Day  you can turn a moment of hidden burnout into an open conversation about sustainable working.

Prioritising wellbeing isn’t just fluffy HR talk; it’s a strategic move that pays dividends in morale, productivity and loyalty. When you show your team that you value their health over their physical presence in a chair, you build trust. And trust is the currency of high-performing teams. So by transforming this day from a statistic of “skiving” into a championing of rest, you’re not just plugging a leak, you’re rebuilding the foundation of your company culture. It’s about creating an environment where people don’t have to fake a flu to get the mental space they need to function.

Strategies for turning National Sickie Day UK into a wellness win

It’s clear that employee wellbeing is an area that could use a bit of TLC (but don’t worry, we’re not asking you to chase waterfalls). It’s really just about taking proactive steps to show your team you value them as people, not just as producers. 

Forget policing absences. Instead, use this day as a launchpad for a culture of genuine wellbeing. Here are five strategies to get you started.

Promote rest and recovery

Burnout plays a huge role in National Sickie Day being a thing. So perhaps it’s time for businesses to stop waiting for it to happen and instead reframe the conversation about noticing the signs and taking time off. National Sickie Day UK is the perfect time to open this conversation. 

Think about it, it’s important for your team to do their best work when they’re at work, but in order to do this, they also need some down time. So encourage your team to use their leave for proactive rest, not just for holidays or physical illness. Introduce the idea of mental health days and make it clear that taking a day to recharge is not just accepted but celebrated. When people know they can take a break without judgement, they don’t need to fake a cold.

Offer practical flexibility for your small team

For SMEs every team member counts, so while being ultra productive is what we’re all striving for most of the time, it’s also not sustainable to be at that level every single day. HR professionals and business leaders can showcase they understand their team’s needs by acknowledging this. 

If the first Monday of February is a low-energy day, lean into it. Where possible, offer flexibility. Flexible working could be in the form of letting people work from home or having more flexible hours (such as starting late or finishing early). For SMEs, flexibility doesn’t have to be formal or complex, it can be agreed quickly, communicated clearly, and adjusted to suit both business and employee. 

This small gesture shows you trust your team to manage their energy and their workload. It’s a powerful way to turn National Sickie Day UK from a day of absence into a day of autonomy and trust. For smaller businesses especially, this kind of autonomy can transform National Sickie Day UK from a spike in absence into a moment that strengthens loyalty, accountability and team morale.

Host wellness activities

Turn a day that can feel negative into something positive and find ways to encourage people to come into work. Some great ways of doing this include:

• A virtual mindfulness workshop. 
• A yoga session.
• Providing breakfast or lunch.
• Walking meetings. 

These activities send a clear message that you care about your team and their wellbeing. It shifts the focus from sickness to wellness and transforms a potentially negative day into a positive, team-building experience.

Make recognition a habit

Ironically, recognition could be one of the most underrated wellness and productivity factors, with the Work That Works report showing that of 20 productivity factors tested, recognition ranks 19th for importance among business leaders. But you shouldn’t be underestimating the power of a simple thank you. The report also shows that when employees feel their work is recognised, they are 33% more likely to go ‘over and above’ what is expected. 

National Sickie Day UK could be the perfect chance to up your recognition game. This could be as simple as shouting out team achievements and celebrating hard work through highlighting everyday wins. Whether it’s a quick message in the group chat or a small team award, regular recognition makes people feel valued…and it lifts morale in ways that spreadsheets can’t measure.

Open conversations about wellbeing

This might be the most important strategy of all. Use the buzz around National Sickie Day UK to start an open and honest conversation about stress, burnout and mental health in the workplace. 

This matters more than many businesses realise. Research from our Work That Works report shows that while business leaders rate employee wellbeing as the number one driver of productivity, it only ranks sixth on the list of priorities organisations plan to focus on over the next 12 months. 

There’s also a clear perception gap. Just 46% of employees rate their organisation highly (8–10 out of 10) for focusing on wellbeing at work, dropping to 42% among workers aged 55–64.

National Sickie Day is a timely opportunity to close that gap. Creating a safe space for your team to acknowledge when they need support doesn’t just help reduce unplanned absence, it gives HR professionals and business owners valuable insight into where improvements are needed. Run a survey, host a town hall, or encourage managers to check in with their teams. Building a culture where it’s safe to talk about these challenges is the ultimate antidote to “pulling a sickie” and a crucial step towards a more productive, resilient workplace.

The best cure for National Sickie Day is a healthier culture

This year, let’s stop dreading the first Monday of February. National Sickie Day doesn’t have to be a symbol of low morale and burnout. Instead, it can be an opportunity to do things differently and a chance to treat the cause rather than managing the symptoms.

When large numbers of employees feel the need to check out, it’s rarely about dodging work. It’s a signal that something deeper needs attention. By acknowledging this, HR teams and business owners can transform National Sickie Day from an annual headache into a genuine wellbeing check-up for their teams. 

So the challenge for business owners and HR managers is 2026 is clear; will you let National Sickie Day be another epidemic of absenteeism or will you use it as a springboard towards a healthier way of working? Because when wellbeing is taken seriously, fewer people feel the need to pull a sickie… and that’s one workplace trend you want to be contagious. 

Want to know more about managing absenteeism and boosting employee morale? Employment Hero has you covered.