The strained finances of UK law firms look certain to face the burden of multi-million pound tax hikes next year following the failure of talks with regulators to spread accounting changes over several years.

The Accounting Standards Board (ASB) has confirmed to Legal Week that the controversial ‘clarification’ of its existing standards, which firms say will force them to pay more of their tax up-front, is now in full effect. Firms will have to pay any increases from the beginning of next year.