The latest news from the Autumn Budget for Small Businesses
Following the Autumn Budget 2024, the Government has announced some additional updates – mainly some increases in expenditure,
The result of combining the Budget and these updates has different impacts on different sectors of the economy. This Blog focuses on small businesses.
The Negatives:
- Higher NICs and Wages: The increases in NICs and the Minimum Wages are a headache. Note, from next year, the National Minimum Wage rate per hour is set at £12.21 across the UK. However, the Living Wage Foundation recommends £12.60 outside London and £13.60 inside London.
You’re left weighing options: raise prices, cut hours, or find other ways to tighten the belt. Many small businesses run on thin margins already, so this feels like being asked to climb Everest in flip-flops.
- Inheritance Tax Changes: For family-run businesses, freezing the threshold until 2030 and adding pension pots into the mix feels like the government dipping into your rainy-day fund. The reductions to Agricultural Property Relief from 2026 will have an even harsher impact on farmers.
- Capital Gains Tax: Thinking of selling your business. While Capital Gains Tax has not increased per se, the relief that small business owners could get on the proceeds of their sale (Business Assets Disposal Relief or BADR) is gradually being cut. 4% from April 2025 and a further 4% from April 2026. If you were thinking of selling in the next couple of years and want to hang onto a bit more of your hard-won cash, then you might want to talk to your accountant about the possibility of selling up before April.
Positive Impacts:
- Employment Allowance: If you qualify, that £10,500 allowance against employer NICs could soften the blow of the NIC rises, particularly for businesses with smaller payrolls.
- Business Rates Relief (Eventually): In 2026, the government promises lower rates for certain sectors. Not ideal if your issues are immediate, but for those who can hang on, it’s a sliver of hope.
How will it balance out?
For small businesses, this budget is less of a “lifeline” and more of a balancing act on a tightrope. There is some help, like the Employment Allowance and eventual business rates relief, but these are outweighed by the immediate challenges of higher wages and taxes.
It’s a delicate dance between staying competitive and keeping costs under control. You may need to rethink hiring plans, rework pricing, or explore tech solutions to streamline operations.
A Glimmer of Hope?
The government is touting its public spending increases—more money for the NHS, schools, and defence—as a way to bolster the economy. If this spending boosts the level of confidence, small businesses might see indirect benefits. But that’s a big “if.”
Final Thoughts
The Budget means that our economy is not the easiest environment to navigate, but resilience is the hallmark of small enterprises. Keep an eye on cash flow, talk to your bookkeeper or accountant (they’re saints in times like these), and focus on the areas you can control.
And remember: sometimes, even the best budgets require tweaks. If your business needs to pivot, don’t hesitate—the earlier a change is made the more impact it will have.
Our goal is to equip our clients with the financial answers to thrive and expand. Call us on 01628 530 805 or email info@anotheranswer.co.uk to find out more about our services and to arrange a free discovery session to see how we can help your business.
