How Will the 2025 Autumn Budget Affect Your Business?
The Office for Budget Responsibility (OBR) accidentally published its report early, revealing key details of this year’s Autumn Budget before the Chancellor’s announcement in Parliament, allowing everyone an early look at its mix of measures that will affect British business owners and the wider public as economic uncertainty continues.
Changes affecting businesses
While it lacks the changes on the scale of 2024’s changes to Capital Gains Tax (CGT) and Business Asset Disposal Relief (BADR), which are still being rolled out, there are still several changes that will affect business owners. These may be a benefit to some, but a detriment to others:
- Lower business tax rates
The rates will be lowered for over 750,000 businesses in the retail, hospitality, and leisure sectors from April 2026, worth nearly £900m per year. - Business rates support package
The package of £4.3 billion will cap business rates increases from April 2026. This is aimed at the businesses expected to be hit by business rate re-evaluations. - Rate relief for film studios
A 40% business rate relief for film studios will be maintained until 2034. - Changes to the Tour Operators’ Margin Scheme
This is intended to end exploitation of the scheme by private hire companies and make the market more competitive for taxi drivers. - End of low value import relief
This will target customs arrangements used by some online retailers to import goods duty-free and without paying other necessary tariffs. Exemptions for imports of small packages worth under £135 will be scrapped from 2029. - Changes to gambling taxes
Bingo duty will be abolished from April 2026. In-person betting in shops and bets on UK horse racing will remain on existing duty rates. Remote Gaming Duty on online casino games and slots will increase from 21% to 40% from April 2026. From April 2027, a new 25% General Betting Duty rate will apply to most remote betting. - Fuel duty cut extension
The 5p cut to fuel duty for petrol and diesel will continue until the end of August 2026, with the aim of saving money for businesses using vans, lorries, and HGVs. - Permanent 40% First Year Allowance for main rate assets
It is hoped that this will encourage further investment from businesses. - Maintaining the £1 million Annual Investment Allowance
This will mean continued tax relief on plant machinery and equipment. - Regional taxes on hotels and holiday lets
English regional mayors will gain powers to tax stays in hotels and holiday lets, akin to plans due to be rolled out in Scotland and Wales.
These changes feature a mix of tax cuts intended to benefit certain sectors and extensions to existing support schemes. However, measures like ending low value import relief and the Tour Operators Margin Scheme, and imposing taxes on parts of the hospitality industry, could mean additional considerations for affected businesses.
Minimum Wage changes
Additionally, the minimum wage has risen again, with an eventual aim to introduce a single wage rate for all adults. The changes coming in April 2026 are as follows:
- Over 21s
The minimum wage for over 21s will increase by 4.1% from £12.21 per hour to £12.71. - 18 – 20-year-olds
The minimum wage for those aged 18-20 years old will increase by 8.5% from £10 per hour to £10.85.
Employees may cheer rises to the minimum wage, but they could pose an additional challenge for employers. Those already dealing with narrow profit margins in a tough economic landscape may find it hard to afford these wage increases.
Personal tax changes
The budget also included changes to personal taxes and savings:
- Taxes on higher-value properties in England
From April 2028, a new annual High Value Council Tax Surcharge (HVCTS) will apply to homes in England valued at £2 million or more. This charge is in addition to their normal council tax bill and, depending on their property’s value, will range from £2,500 to £7,500 a year. These amounts will rise in line with inflation from 2029–30. - Frozen National Insurance (NI) and income tax thresholds
The thresholds for when you start paying certain taxes will remain frozen for three additional years from 2031. With average earnings rising, this means people will have to pay tax on more of their income. - Cap for cash ISAs
The cash ISA allowance will reduce from £20,000 to £12,000 for those under the age of 65 from April 2027. - National Insurance (NI) on pension contributions of more than £2,000
From April 2029, those paying under salary sacrifice schemes will pay NI on contributions greater than £2,000 per year. - State pension payments to increase
Basic and new payments will increase by 4.8% from April 2026.
Many of the new measures are restrictions or caps to certain benefits, specifically on ISA and pension contributions. Combined with the new tax on certain properties, these measures mean some may lose out financially.
How we can help your company
If you’re concerned that the upcoming budget changes will negatively impact your company, or if you’re already facing financial challenges, speak to us. We can offer free, impartial, confidential advice with no obligation.
Our licensed insolvency practitioners can carry out formal insolvency proceedings. By acting quickly, you give yourself a better opportunity of achieving the outcome best for your company.
Depending on your situation, we can explore options such as:
- Repay your company’s debts in a Company Voluntary Arrangement (CVA)
A CVA is a payment plan between your company and its creditors that allows you to repay an affordable portion of your company’s unsecured debts over a fixed period while it continues to trade. All interest and charges are dropped and creditors in the arrangement cannot take further legal action. - Restructure and stabilise your company through Administration
Administration is an insolvency procedure for companies, putting it in a temporary state of protection by a moratorium that halts creditor action and gives your company the breathing space to continue trading. Its main purpose is to rescue your company as a going concern, attempting to restructure and turn it into a leaner, more profitable organisation. - Close your insolvent company via a Creditors Voluntary Liquidation (CVL)
A CVL will formally close and liquidate your insolvent company, ceasing its trading operations, realising any assets, and removing the threat of creditor legal action. Once completed, your company’s unsecured debt will be written off, and the company is dissolved, allowing you, the director, to move on. - Close your company and start again in a pre-pack liquidation
A pre-pack liquidation is a type of CVL where the sale of your company’s assets is arranged before liquidation, allowing operations to continue under the purchasing company. The company name may be reused, and employees can transfer under TUPE. Contracts and essential agreements can also be included as part of the sale, ensuring minimal disruption to your business operations. This process eliminates the unsecured debts of your previous company. - Close and liquidate your solvent company through a Members Voluntary Liquidation (MVL)
An MVL is the liquidation and closure of a solvent company. The procedure will formally wind up and close your company while extracting the company’s maximum value through its various tax benefits. The company’s assets, including any premises, are realised, with the remaining funds distributed to shareholders once creditors are satisfied.
How to get in touch with us
- Speak with our initial advisers
Contact our team via phone, filling in a form, or via our online chat. If we can help, we will arrange a free consultation with one of our consultants to discuss your situation in more depth. - Initial assessment
During the consultation, we will advise if there is an appropriate route forward with us or whether an alternative solution is better suited for your company. - Formally engage with Wilson Field
If there is an appropriate insolvency solution, we will confirm the necessary steps to start the procedure and will issue you with the relevant documentation for you to formally engage us.
In summary
This Autumn Budget introduces several support measures for businesses and extends some which already exist, although factoring in the minimum wage increases may be challenging for some businesses. Outside of the rise in the minimum wage, the budget may not be so good for individuals, with additional taxes and restrictions on saving to pay for the measures. If you’re already struggling to manage your company’s cashflow, taking advice early can help you understand your options and decide the best way forward for you and your company.