The 2025 Autumn Budget changes that might affect your business, and how Belvedere Wealth can help

The 2025 Autumn Budget introduced a range of changes that could affect people and businesses across the UK. 

You might have noticed eye-catching headlines about frozen tax allowances or changes to the Cash ISA.

Read more: The new Cash ISA rules and what they mean for your savings

While some of the changes might not affect you, several measures could have a direct impact on owners of small or medium-sized enterprises (SMEs). 

Now that the dust has settled, it’s worth understanding which of these changes could influence your business the most, and how careful planning could help protect both your company and your personal wealth. 

With that in mind, continue reading to discover the 2025 Autumn Budget changes that might affect businesses, and how Belvedere Wealth could help you adapt to them. 

A new cap on Business Relief may mean more of your assets are subject to Inheritance Tax

Business Relief (BR) allows you to pass on business assets without them incurring a full Inheritance Tax (IHT) charge. This could be especially useful if you control a family-owned business and you wish to mitigate as much IHT as possible. 

The 2025 Autumn Budget confirmed significant reductions to BR. From 6 April 2026, a new £2.5 million limit will apply to the combined value of assets eligible for BR. 

While this still provides some protection from IHT, the change means that any assets valued above this threshold could be subject to IHT, potentially requiring your beneficiaries to sell assets to meet tax obligations. Any taxable assets may be eligible for 50% IHT relief, but your business could still be vulnerable to IHT from April 2026 onwards.

To help, we could review the succession and ownership structures of your business.

Assessing your potential tax liability now and exploring strategies for mitigating exposure could help protect the value of your business while ensuring your long-term plans still align with your personal objectives. 

A new salary sacrifice cap could affect your employee retention

Salary sacrifice allows employees to reduce their pay in return for non-cash benefits, often pension contributions.

These contributions allow employees to reduce their take-home pay, potentially lowering their tax bill.

Moreover, contributions made through salary sacrifice are typically exempt from Income Tax and National Insurance (NI).

As an employer, you may have benefited from not paying Class 1 secondary National Insurance contributions (NICs) on the amount sacrificed by the employee.

However, from April 2029, the government will limit the efficiency of NI on these contributions. Employees still won’t pay Income Tax on contributions, but any amount sacrificed above £2,000 into a pension will attract NI.

On the portion exceeding the cap, your employees will pay Class 1 NICs, while you would be liable for the standard 15% rate. 

This cap could make pension contributions made through salary sacrifice much more expensive, especially if you use salary sacrifice to attract or retain staff. 

As such, it’s worth seeking professional guidance well ahead of the changes. 

Over the coming few years, we could help model how the cap could affect your business by forecasting potential increases in employee and employer costs. 

This could allow you to make more informed decisions about remuneration strategies and ensure that your employee benefits continue to support the stability of your business. 

Reduced Writing Down Allowances could limit your overall tax relief

While Corporation Tax rates remain unchanged, the 2025 Autumn Budget did introduce a reduction to the main rate of Writing Down Allowances (WDA). 

When your business invests in plant, machinery, or equipment, you can typically claim the cost through WDA (provided it doesn’t qualify for immediate tax relief through full expensing or the Annual Investment Allowance). 

This usually stands at 18%. However, from April 2026, this will fall to 14%. This change could mean your tax relief is reduced, ultimately affecting your cash flow. 

If you are considering making a significant investment in new machinery, it’s now vital to consider the timing.

We could help you assess any plans for investment in light of these changes. For instance, we could model the reduced tax relief for various investments to help you determine the most effective approach to acquiring new machinery. 

This could ensure your business can continue to grow tax-efficiently.

A rise in the National Living Wage could increase payroll costs

The government also confirmed a further increase to the “National Living Wage” from April 2026. 

Indeed, employees over the age of 21 will earn £12.71 an hour, up from £12.21, while 18- to 20-year-olds will see their wages rise from £10 to £10.85. 

If you own an SME, the most apparent effects of this change are higher payroll costs and potentially additional employer NICs. 

If your business has a larger pool of staff or tighter margins, these increases could quickly affect your budgeting or pricing. 

Thankfully, we could help you plan for these financial implications by reviewing payroll costs and projecting any future obligations.

We could even explore whether you can make changes to your remuneration programmes, ensuring your business remains profitable and you can still retain staff.

Get in touch

We could help you stay abreast of any changes announced in the 2025 Autumn Budget and enable you to make informed decisions about your day-to-day business operations. 

To find out how we can support you, please fill in our online contact form, email us at enquiries@belvederewm.com, or give us a call at +44 (0)203 633 6603.

Please note

This article is for general information only and does not constitute advice. The information is aimed at individuals only.

All information is correct at the time of writing and is subject to change in the future.

The Financial Conduct Authority does not regulate tax planning, estate planning, or cashflow planning.

A pension is a long-term investment not normally accessible until 55 (57 from April 2028).

The fund value may fluctuate and can go down, which would have an impact on the level of pension benefits available. Past performance is not a reliable indicator of future performance. 

The tax implications of pension withdrawals will be based on your individual circumstances. Thresholds, percentage rates, and tax legislation may change in subsequent Finance Acts. 

Workplace pensions are regulated by The Pensions Regulator.

The value of your investments (and any income from them) can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance. 

Investments should be considered over the longer term and should fit in with your overall attitude to risk and financial circumstances.