Prime Minister Andy Burnham has presented his annual Budget to Parliament in Westminster. To help members make sense of it, the BLCC has worked with Try Lunn & Co and JM Finn to pull together the points that matter most to businesses and individuals.
Key Highlights
Corportation Tax Rates
The main UK corporation tax rate remains at 25% and the small profits rate at 19%.
Employer National Insurance (NIC)
The employer’s Class 1 NIC remains at 15% on earnings above the secondary threshold (currently £96/week, about £5,000/year).
Employment Allowance
The Employment Allowance remains at £10,500 per eligible employer per year.
National Minimum Wage
The National Living Wage (for age 21+) rises by 3.9% to £13.21 per hour. The Young Workers rate (age 18–20) will rise by 3.9% to £11.27.
Business Rates
From 1 April 2027 the small business rates relief thresholds for retail, hospitality and leisure properties will be raised. Properties up to £18,000 rateable value will qualify for 100% relief, with tapered relief up to £21,000.
Business Rates
The main First-Year Allowance for plant and machinery will rise from 40% to 50% (if incurred from 1 January 2027), while the main writing-down allowance will fall from 14% to 12% from 1 April 2027.
R&D Tax Relief Claims
The requirement to file a separate R&D claim notification form is being removed from April 2027.
Entrepreneur / Start-up Incentives
Founders’ relief: A new “Founders’ Relief” will offer a 10% rate of Capital Gains Tax on up to £10 million of lifetime gains for founders of qualifying companies.
CSOP limits: The Company Share Option Plan limit is doubling to £120,000 per individual (from £60,000) from 6 April 2027.
Overseas Service VAT Rules
From April 2027, the reverse charge for B2B services will be restricted to cases where the UK recipient is VAT-registered. If a UK business is not VAT-registered, the overseas supplier must charge UK VAT.
Online Marketplace VAT
From October 2027, online marketplaces will be responsible for collecting VAT on qualifying sales by any UK VAT-registered business, and by any UK business with over £90k annual sales on the platform.
Mileage Allowance (tax-free rates)
The tax-free mileage rates for cars/vans are now 55p per mile for the first 10,000 business miles and 35p per mile thereafter.
Electronic Invoicing
The government will require VAT invoices to be issued electronically in a prescribed structured format from 1 April 2029.
We would like to thank Try Lunn & Co and JM Finn for their collaboration in preparing this summary.
For those interested in learning more about how this budget could affect your business, we highly recommend downloading Try Lunn's Budget summary.
For individuals interested in learning about how the budget may affect them individually, we highly recommend reading JM Finn's Budget summary.