Autumn Budget 2025: A defining moment for SME tax strategy
The 2025 Autumn Budget will be delivered by the Chancellor, Rachel Reeves, on 26 November. As we approach, the stakes for SMEs have rarely been higher. Against a backdrop of sluggish economic growth and mounting fiscal pressure, the government faces a delicate balancing act: raising revenue without stifling enterprise.
For SME owners, this Budget could mark a pivotal moment - one that shapes financial strategy for years to come.
Signals from Westminster: What might be coming
While the Chancellor’s final announcements remain under wraps, the policy signals are growing louder. Among the measures reportedly under consideration:
- Income Tax increase – although a break from the Labour manifesto, the Chancellor may find there is limited choices available and therefore reintroduce a top rate of 50% for high earners
- VAT reform - including potential scope expansion or tighter compliance rules that could disproportionately affect smaller businesses.
- Targeted tax changes - particularly for groups such as landlords, where the Treasury sees scope for additional revenue.
- Capital Gains Tax (CGT) adjustments - possibly aligning rates or thresholds, especially in light of recent moves on Inheritance Tax (IHT). This could have direct implications for founders contemplating a sale or succession.
These developments suggest a Budget that could significantly reshape the SME tax landscape; however, the tax increases that are inevitable may be balanced with some targeted tax reliefs for businesses, which may include the extension of the Business Asset Disposal Relief to make this more generous or the reintroduction of some form of taper relief to reward long-term business owners.
Strategic planning starts now
The most forward-thinking business owners likely aren’t waiting for the Chancellor’s speech. They’re already scenario-planning around key questions:
- How should value be extracted from the business - via dividends, salary, or alternative mechanisms?
- Is now the right time to restructure, sell, or initiate succession planning?
- Will current business structures remain optimal in a post-Budget environment?
Early preparation creates agility. Those who assess their options now will be best placed to respond quickly - protecting, and potentially enhancing, their financial position.
Timing is everything
Budgets bring both risk and opportunity. Tax changes can erode margins - but they can also unlock new reliefs and incentives. The challenge is that, once the rules change, the window to act often closes quickly.
That’s why scenario planning is essential. While acting on speculation can be risky, preparing for multiple outcomes ensures you're not caught flat-footed. It’s about being ready - not reactive.
Join our post-Budget briefing
To help leaders navigate the changes, our team will host a live webinar following the Budget. We’ll unpack:
- The key announcements affecting businesses
- Practical implications for financial strategy
- Where opportunities remain and what actions to take next
Date: Friday 28 November
Time: 11:00 – 12:30
Format: Live webinar with Q&A session
Time: 11:00 – 12:30
Format: Live webinar with Q&A session
Register now to secure your place and ensure your business is ready to respond with confidence.
We’re here to help
If you have any questions in relation to planning or would like to discuss your current circumstances, please get in touch with one of our specialist tax advisors.
