What the Autumn 2025 budget really means for your business
What the Autumn 2025 Budget really means for your business!
The 1 Accounts verdict?
Costs are climbing. Tax relief is shrinking. And HMRC is sharpening its pencils.
The Bottom Line: Your costs are going up, and there's less tax relief to help soften the blow.
Your wage bill is about to jump
From April 2026, employing a team gets more expensive:
If you employ people on minimum wage (21+), their hourly rate goes up from £12.21 to £12.71. That’s 50p extra an hour.
Younger workers (18-20) get an even bigger 8.5% jump, taking them to £10.85 per hour
Under 18s and apprentices move from £7.55 to £8.00
This is part of the government’s commitment to establish a single adult rate for minimum wage.
And there’s more under the surface too…
Employment Tax thresholds, e.g. National Insurance and Income Tax, are frozen until 2031.
As wages naturally rise, more employee earnings get dragged into higher tax bands. Your team will feel the pinch — and that often leads to pressure for pay rises beyond the legal minimum.
Property & dividends — taxes rising by 2%
From 6th April 2027, a new system of separate tax rates for property income kicks in:
Basic rate: 22%
Higher rate: 42%
Additional rate: 47%
And from 6th April 2026, dividend tax rates are increasing:
Ordinary rate rises to 10.75%
Upper rate rises to 35.75%
Worth remembering → these are the profits you take out after corporation tax is paid. So the real cost to you is higher still.
Salary sacrifice pension schemes? NI is coming for them too
Right now, salary sacrifice pension schemes allow both you and your employees to avoid National Insurance on sacrificed salary.
But from April 2029:
National Insurance will apply to pension contributions over £2,000 a year
Currently neither employer nor employee pays NI on salary sacrificed into pension
From April 2029, that NI saving disappears on anything above £2,000
Then from April 2029, both you and your employees will start paying NI on pension contributions over £2,000 per year.
Retail, hospitality, leisure? Some good news here
If you run a shop, restaurant, or anything high-street facing:
From April 2026, Business Rates drop permanently for:
Retail, hospitality or leisure premises worth under £500,000
The bill is being shifted to warehouses & distribution centres (Amazon-style operations), which will pay significantly more to fund your relief
Think of this as the big online retailers finally paying their share
Expanding to a second retail or hospitality premises?
You’ll get a 3-year grace period before losing your Small Business Rates Relief
And you won’timmediately lose small business rates relief if you expand to a second property.
Equipment & business sale relief is taking a hit
Three key changes from April 2026:
Equipment tax relief drops from 18% to 14%
You’ll now get less tax back when buying vans, machinery, or other business kit
Capital Gains Tax Business Asset Disposal Relief (BADR) rate increases from 14% to 18%
Selling your business to employees through an Employee Ownership Trust?
That tax break has been halved from November 2025
You now pay tax on 50% of the gain instead of full relief
Still more tax-efficient than a trade sale, but not as generous as before
More costs & compliance changes are heading your way
Key dates you need to know:
April 2026: Homeworking expense relief disappears (if you've been claiming tax back for employees working from home)
April 2028: Electric company cars will start paying a mileage tax:
3p per mile for EVs
1.5p for hybrids
How this will be administered is still unknown
April 2029: VAT invoices must be issued electronically in a specific digital format
More clarity to come — but if you're still invoicing on paper, now is the time to go digital
March 2029: Duty-free import relief for low-value goods under £135 is being scrapped
Designed to remove the advantage currently held by Temu and Shein
And one more thing… HMRC is watching small businesses more closely
The government is investing in tax enforcement, aiming to recover £2.3 billion specifically by targeting small businesses
Dedicated fraud & evasion teams are being launched
The message? Your bookkeeping and tax compliance must be airtight
If you want help with:
Keeping your records investigation-ready
Setting up Tax Investigation Insurance
Making sure your books would survive an HMRC microscope
…we’ve got your back. (We can also sort your investigation insurance too — just say the word.)
So, what should you do now?
Review your wage budgets for April 2026 and bake in the increases
Check your personal pay strategy → PAYE vs Dividends
Assess your pension setup and model the April 2029 NI impact
See if you're eligible for the new lower business rates
Make your records spotless, compliant, and digital-future ready
The theme is clear:
Costs up. Reliefs down. Compliance tighter.
Here is a video to help you understand the key changes:
Feeling the pressure? You don't have to figure it out alone!
If any of this has made you think:
“How on earth will this impact my cashflow?”
“Are we structured in the best way tax-wise?”
or simply “Help!”
…then it might be time we had a chat.
At 1 Accounts, we’re all about giving you clear answers, practical support, and a plan that actually works for your business. Whether it’s wage budgeting, dividends or moving to digital systems— we’re here to steady the ship.
If you’re worried, unsure, or just want someone to sense-check it all with you, get in touch with us. No jargon. No judgement. Just support, advice, and next steps you can act on.
Reach out to 1 Accounts — we’ve got your back.
Phone: 01440 844986
Email: [email protected]
