Autumn Budget 2025: What it Means for You and Your Business
- khaccounts
- Nov 27
- 2 min read
The Autumn Budget 2025 has arrived, and there’s a lot in it for small business owners, landlords, and self-employed people. With rising costs, higher wages and cash-flow challenges affecting almost every business, this Budget gives us an idea of what the government is planning for the next few years.
Below is a simple summary of the key changes and what they mean in real life.
Income tax and thresholds
Income tax thresholds are frozen for another 3 years.
That means:
Personal allowance stays at £12,570
Higher-rate threshold stays £50,270
No increase until April 2031
This is important because while tax rates aren’t going up, more people will end up paying more tax simply because wages and profits change over time.
Business rates reforms
This is a big one for shops, cafes, salons, and hospitality.
Lower business rates for retail, hospitality and leisure
Funded by higher rates for larger properties
There will also be protection for businesses facing large increases, with caps and relief schemes staying in place.
National Minimum Wage is increasing
From April 2026:
Age 21+ → £12.71 per hour
Age 18–20 → £10.85
Under 18 and apprentices → £8.00
Good news for workers, but many small business owners may need to plan ahead for higher wage bills.
Making Tax Digital changes
There’s a softer start:
No penalties for late quarterly MTD submissions in the first year (2026–27)
New penalty rules will apply from 2027
This gives businesses and accountants more time to adjust.
Electric vehicle tax
From April 2028:
New mileage charge for electric and hybrid vehicles
Plus extra government funding to support EV grants
ISA system changes
The £20,000 ISA limit stays, but:
£8,000 will be for stocks and shares
£12,000 for cash ISAs
Tax rise on savings and dividends
This is one of the biggest changes for company directors and investors:
Dividend tax rises by 2% from April 2026
Savings tax also rises by 2% from April 2027
So drawing income from dividends gets more expensive.
What does this mean for small businesses?
Many business owners will feel mixed emotions.
There are some positives:
✔ Support for high street and hospitality
✔ More time to prepare for MTD
✔ Apprenticeship funding
But there are also challenges:
⚠ Higher wage costs
⚠ Higher tax on dividends and savings
⚠ More pressure on cash-flow
Many small businesses are already dealing with rising costs, energy bills and staff shortages. These changes will require planning.
If you want to understand how any of these changes affect you personally, or want to review your business tax planning, I’m here to help.
Send me a message or book a call below, and I’ll walk you through it.