Autumn Budget 2024: Key takeaways for small businesses

Ah, the autumn budget reveal—it’s like Christmas for finance enthusiasts! Once again, the Chancellor of the Exchequer has graced the steps of No. 11 Downing Street, clutching that iconic red briefcase, ready to outline where the country’s money will be flowing in the coming year. This year, Rachel Reeves took the stage to share her first budget as Chancellor, laying out the government’s vision on everything from taxes to schools, from fuel to fairness in the workplace.

But don’t worry; we’ve done the heavy lifting for you, sifting through the long speech to bring you the top takeaways for your small business. So grab a cup of coffee, and let’s get into what this budget means for you.

Revamping HMRC

The Chancellor has pledged a substantial investment in modernising HMRC’s systems and processes. There’s also a promise to “go after” those promoting tax avoidance schemes, and with an increase in interest on unpaid taxes, the government hopes to improve cash flow into the Treasury.

Workers rights

In a move that’s already hit headlines, there’s a renewed focus on protecting workers’ rights. Employers take note: there’s additional funding to ensure fair treatment, better safeguards against workplace bullying, and improved access to maternity and paternity leave. This budget also reflects recommendations from the Low Pay Commission, bumping up the National Living Wage to £12.21 an hour. For young adults (ages 18-20), the hourly minimum rises to £10, with a view to eventually bringing it in line, so there is a singular adult amount.

Fuel duty freeze

For businesses that rely on transportation, there’s a small victory to celebrate: fuel duty has been frozen for yet another year. While costs at the pump are still high, at least they won’t be climbing further (for the next year at least).

Electric vehicles

If you’re considering adding electric vehicles to your company fleet, this budget has some promising incentives. The Chancellor is extending tax breaks for EVs to keep the upfront costs more manageable. From April 2025, zero-emissions vehicles will enjoy a freeze on the lowest First Year Rate (FYR), while all other emission bands will see rate hikes. Businesses can also benefit from extended first-year allowances on both electric vehicles and charging stations, showing the government’s commitment to a 2030 goal of phasing out fossil-fuel-only vehicles.

On the high street

The high street remains a priority in this budget, with new measures intended to support retail, hospitality, and leisure businesses through a variety of rate cuts and reliefs.

Business rates relief

For 2025/2026, high street businesses in retail, leisure, and hospitality sectors will enjoy a 40% reduction on business rates, capped at £110,000 per business. Additionally, from 2026/2027, we’ll see a new, lower tax rate on business rates for these sectors, offset by higher rates on the nation’s most valuable properties. A win for the hard-working small business community at a time when high streets need support.

Cracking down on shoplifting

To tackle the spike in shoplifting, the government is putting new measures in place to support retailers. More funding will go toward enforcing consequences for shoplifting offenses, boosting retailer training, and enhancing police resources to help combat organised theft rings.

Corporation Tax and National Insurance changes

Good news for companies wary of tax hikes: corporation tax will stay locked at 25% for now, and the investment allowance will remain at £1 million.

National Insurance adjustments

On the flip side, there is a 1.2 percentage point increase in employer National Insurance contributions (NICs) to a total of 15%, starting April 2025. However, the employment allowance has been increased from £5,000 to £10,500. This means that more than 860,000 employers won’t pay any NICs next year, and others will see their NICs stay the same or even decrease.

Personal tax threshold freeze remains in place

For those looking at the personal tax side, the current freeze on income tax and NIC thresholds remains in place until 2028/2029. After that, these will once again be adjusted in line with inflation – good news!

Faster, reliable broadband and mobile connectivity

Another budget highlight is a £500 million investment in boosting broadband and mobile coverage across the country. This funding will help improve connectivity in rural areas and give businesses across the UK more access to fast, reliable internet—good news for any business operating outside of a city center!

We’ve hit the highlights, but there’s plenty more detail on the official UK government website if you want to dig deeper. This year’s budget strikes a balance between supporting workers, tackling crime, and advancing the digital and electric revolutions.

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