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Impact of today's Budget on your business

Journalist: Rebecca Burn-Callander, Freelance

ended 26. November 2025

Business owners, how do the changes unveiled in today's Budget affect your ability to grow your business, create jobs, weather economic shocks and receive fair remuneration?

Some of the headline changes include:

  • Minimum Wage for workers over the age of 21 will rise to £12.71 in April 2026, a 50p increase on the current figure
  • Eligibility for enterprise schemes to be expanded
  • Reduced capital gains tax relief on disposals to employee ownership trusts, which raises £0.9 billion
  • A reduction to the writing down allowance main rate in corporation tax, which raises £1.5 billion 
  • Freezing personal tax and employer National Insurance contributions (NICs) thresholds for three years from 2028-29, which raises £8.0 billion
  • Charging NICs on salary-sacrificed pensions contributions, raising £4.7billion
  • Funding to make training for under-25 apprenticeships free for SMEs
  • Increasing the tax rates on dividends, property and savings income by 2 percentage points, raising £2.1 billion
  • A new mileage-based charge on electric and plug-in hybrid cars from April 2028 at around half the fuel duty rate paid by drivers of petrol cars (raising £1.4bn)
  • UK listings relief – exemption for companies listing in Britain
  • Permanently lowered business rates for 750,000 retail, hospitality and leisure businesses, paid for higher rates on properties worth more than £500,000, used by “warehouse giants”

 

5 responses from the Newspage community

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Editor
Kate AllenVerified
Owner at Finest Stays
The tax changes are a real blow for holiday-home owners, which in turn affects our business. When you increase tax on property income, dividends and savings at the same time as freezing personal tax thresholds, you’re effectively eroding their real return, even if rental income stays the same. It means owners have to work twice as hard just to stand still. For agencies like ours, it ramps up pressure to deliver even higher booking values simply so owners can cover rising costs. And if the top end of the market starts to feel overtaxed and undervalued, investment will slow, which risks damaging the wider tourism economy that depends on these high-quality holiday homes.
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Steve WittVerified
Co-founder at Not Just Travel
This Budget has been one of the most anticipated in recent memory. As a result, many consumers have been delaying purchase decisions until after the Budget announcement. They wanted clarity on what disposable income they would have available.

The Budget reveals there is no significant immediate impact on consumers' income. Consumer confidence will grow as they recognise there are no major immediate changes. Consequently, we can expect an influx of bookings for both last-minute holidays and 2026 departures.

Overall, Labour needed to be strategic. They couldn't introduce too many divisive changes without alienating the population. As such, this has been a neutral Budget.

RESPONSE VIDEO LINK: https://1drv.ms/v/c/4a757390828f9eb9/IQApezrB85peQb2C5VWmhnkdAdoxGfXWDIZLS_BwKLWR__Y?e=ULYknc
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Martin Port0
Founder at Build Concierge
The increase to minimum wage is good news for a business like ours, which makes AI-powered software. 

The minimum wage hike makes it harder for businesses to take on staff for entry level roles in areas such as admin, which is an area we are looking to disrupt. 

The government has also stated its intention to support AI more widely. I have yet to see the detail but, as a proponent of ethical AI, where we support humans, not replace them, it's a shame that government is making people increasingly uncompetitive as a resource. 
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Colette MasonVerified
AI Ethics Consultant at Clever Clogs AI
This budget forces businesses toward automation they're unprepared to implement. Inflation, frozen income tax bands, dividend tax increases, higher employer NICS, and reduced corporation tax allowances create an impossible equation: cut staff, boost automation, increase risky AI deployment, or watch profit margins collapse.

Minimum wage increases and employer NI changes make hiring harder when businesses still need human oversight for AI systems, which MIT reports have a 95% failure rate for pilot projects.

Business owners with tech expertise may navigate this transition, but for NEETs, gig economy workers, and middle managers whose roles are increasingly automated, the outlook is bleak. The cost of living crisis and job uncertainty slams workers' wallets shut.

Businesses will have fewer experienced staff for AI oversight, tighter margins for tech investment, limping along with rushed mission-critical automations.
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Simon Thomas0
Managing Director and Chartered Accountant at Ridgefield Consulting
Today’s Budget delivers a clear stealth tax on business owners. Despite claiming no rise to income tax or NICs, the government is increasing the burden by raising tax on rental income, dividends and savings by 2 percentage points, which are key income streams many owners depend on to reinvest and stabilise their businesses. This comes on top of last year’s employers’ NICs increase, which many are still absorbing. The new £2,000 cap on salary-sacrifice pension contributions further limits legitimate planning options and increases effective taxation. These measures reduce post-tax income, squeeze cash flow and restrict the capacity to grow, hire and build resilience. For SMEs already navigating rising costs and economic uncertainty, this Budget shifts even more pressure onto owners through quiet, indirect tax rises.