Autumn Budget Week Is Here! Is Your Business Prepared?

Catch up on the final rumours and tax predictions before Wednesday's reveal.

With the Autumn Budget due on Wednesday 26 November 2025, UK businesses are bracing for another round of fiscal changes. Although the Chancellor has hinted that headline tax rates will not rise, the government still faces a £20–30 billion fiscal gap, meaning the Budget will likely rely on a mix of threshold freezes, relief reductions and tax-base reforms to raise revenue.

Here’s a concise look at what could change, what seems increasingly likely, and what these measures may mean for UK businesses.

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Income Tax Rate Rises Look Unlikely, but Threshold Freezes Are Back on the Table

Early speculation suggested that the government might raise income tax rates. However, recent signals point the other way: no increase to headline rates for basic, higher or additional rate taxpayers.

But that doesn’t mean no tax rise. Instead, the government is widely expected to freeze income tax thresholds, including:

• Personal Allowance

• Higher-Rate threshold

• Additional-Rate threshold

This “fiscal drag” approach quietly pulls more people into higher tax bands as wages rise — increasing the effective tax burden without raising nominal rates.

Impact on businesses

• Wage increases for employees could become more expensive due to higher employer NIC obligations.

• Directors paid via salary + dividends may see a higher marginal rate due to bracket creep.

• Owner-managers should review remuneration strategy before year-end.

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Possible Reforms to Property-Related Taxes

With the government looking for new revenue sources, property remains a likely focus area. Several areas have been publicly discussed by analysts or think tanks:

Council Tax reforms:

A revision to Council Tax bands, especially at the top end, is increasingly likely, with newer, higher-value property bands under consideration.

Stamp Duty Land Tax (SDLT):

There have been suggestions that the Chancellor may revisit SDLT, particularly for investors or second-home buyers. Complete scrappage is extremely unlikely, but tweaks or surcharges may appear.

Business impact:

• Commercial property investors, developers and buy-to-let businesses should be alert to potential cost changes.

• Companies using property as part of long-term investment or pension strategies may need to reassess planning.

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Reliefs and Allowances Under Increased Scrutiny

Analysts anticipate that rather than imposing new mainstream taxes, the government may look at reducing or reshaping existing reliefs.

Areas being widely discussed include:

• Pension tax relief, particularly higher-rate relief

• Salary sacrifice schemes

• Potential tightening of reliefs for certain business structures (eg LLPs)

• Further reform to capital allowances or investment incentives

Impact on businesses:

• Pension contributions may become less tax-efficient for higher earners.

• Businesses relying on salary-sacrifice arrangements (e.g., EV schemes) should watch for rule changes.

• Owner-managers should model different combinations of salary, dividends and pension contributions now.

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Corporation Tax and VAT: Unlikely Rate Changes, but Possible Base Reforms

The Chancellor has committed not to raise the headline rates of income tax, VAT or National Insurance for “working people”, a manifesto pledge that leaves limited room to manoeuvre.

Corporation Tax:

The rate is unlikely to rise again following recent increases. However, adjustments to reliefs remain possible.

VAT:

The standard rate is expected to remain unchanged, but ministers could still examine:

• sector-specific VAT reliefs

• exemptions

• registration threshold freezes

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Expect “Stealth Taxes” Rather Than Headlines

Given political constraints, experts believe the government will rely on less visible revenue-raisers, such as:

• Freezing thresholds (income tax, VAT registration, NICs)

• Removing or shrinking reliefs

• Adjusting tax bases

• Anti-avoidance tightening

• Increasing fees or minor duties

• Indexation pauses on certain business allowances

Impact on businesses

Individually, these measures seem small, but collectively they can create a significant tax shift over time.

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What Businesses Should Do Now

With multiple tax changes possible, and many targeted specifically at business owners, now is the time to prepare.

Key actions before the Budget

• Review salary/dividend mix for directors ahead of anticipated threshold freezes.

• Consider timing income and expenditure to optimise current allowances.

• Assess property holdings if SDLT or Council Tax reforms could affect your position.

• Review pension contribution strategy, especially for higher-rate taxpayers.

• Ensure capital allowances are fully used before any potential changes.

• Stay alert to changes in business reliefs that could affect cashflow in 2025–26.

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Final Thoughts...

While the government may avoid headline–grabbing rate hikes, the combination of threshold freezes, relief reductions and structural reforms could still result in higher tax burdens for many businesses and business owners.

With uncertainty high and the Budget only days away, reviewing your financial position now could help you avoid surprises, and ensure your business is ready for whatever the Chancellor announces on Wednesday.