Chancellor Rachel Reeves’s Autumn Budget brings a mix of changes, particularly in tax and wage regulations, that could significantly impact your business. Here’s a breakdown of the most relevant updates, what they mean for you as a business owner, and how you can navigate the new landscape.
Increased Employer National Insurance Contributions ⬆️
Starting in April 2025, the employer National Insurance contributions rate will rise by 1.2% to 15%, and the secondary threshold (where contributions begin) will drop from £9,100 to £5,000.
Increased Employment Allowance 💸
The increased Employment Allowance (which reduces the amount of Employers National Insurance Contributions payable)— from £5,000 to £10,500—offers some relief for smaller businesses, but less so for mid-sized and larger operations.
Business Rates Relief 🏢
Retail, hospitality, and leisure businesses will see adjusted business rates relief, which will drop to 40% (down from 75%) for 2025/26. In 2026/27, two lower, permanent rates for these industries will be introduced to provide longer-term relief.
Rising Minimum Wage Requirements 💼
The National Living Wage for workers over 21 will rise by 6.7% to £12.21 an hour, representing an increase of about £1,400 annually for a full-time employee. Younger employees will see gradual wage adjustments too, as the government works toward a single-adult rate. .
Capital Gains Changes 💰
The new budget raises the Capital Gains Tax (CGT) lower rate from 10% to 18% and the higher rate from 20% to 24%, though second home sales remain at the current rate. Business Asset Disposal Relief rates will increase to 14% (up from 10%) for disposals made in the 2025/26 tax year and 18% for disposals made in 2026/27 tax year.
Inheritance Tax Changes 🏡
Inheritance Tax (IHT) will also see changes, with the IHT threshold freeze extending to 2030 and new tax obligations on inherited pension pots from 2027.
What are your thoughts on this latest financial announcement? how will it affect you and your business? You can find further information on the above points by visiting the Gov website.
If you would like more information on any of the points mentioned above, contact a member of Team SAS who will happily guide you through the best options for your business.
