Sarah's View: What Budget 2026 Means for Your Small Business Clients

For most small business owners, the first question after a Budget is straightforward: what does this mean for my business?

Our members help them answer it. They know the figures, understand the pressures and can identify which announcements need attention now and which need planning for later.

There is plenty in today’s Budget for bookkeepers to work through, particularly around business rates, payroll and the self-employed. My priority is making sure our members can turn those announcements into clear, practical conversations with their clients.

The headlines for your small business clients

• VAT registration threshold: unchanged at £90,000. Keep monitoring clients whose taxable turnover is approaching it.
• Small Business Rate Relief: the full-relief threshold rises from £12,000 to £18,000 rateable value for eligible retail, hospitality and leisure businesses. Check eligibility and the implementation details before assuming a client’s bill will fall to zero.
• Pubs, clubs and live music venues: a 20% business rates cut from April 2027. Check which premises qualify.
• Trading allowance: increases from £1,000 to £3,000, supporting people with small trading incomes. Check the effective date before applying the higher allowance.
• Business Asset Disposal Relief: the lifetime limit falls from £1m to £500,000. Flag this to owners considering a sale or retirement and refer them to their tax adviser.
• Property and savings income: higher tax rates apply from April 2027. Review the total change from clients’ current rates, including previously announced increases, with their tax adviser.
• Full expensing: retained for qualifying company expenditure on plant and machinery.
• Online marketplaces: tougher VAT rules make it important to review affected online sellers’ arrangements.

Business rates relief could make a real difference to clients in retail and hospitality. The next step is to establish who qualifies and what the saving means for their cash flow. Check the rules for the nation in which the property is located, as business rates are devolved.

For owners considering a sale or retirement, the change to Business Asset Disposal Relief needs an early conversation with their tax adviser. Bookkeepers have an important part to play here: having accurate records ready so decisions can be made with a clear understanding of the business’s position.

Payroll and employment

• Minimum wage: a 3.9% increase means employers need to revisit payroll budgets. Check the published rates for each age band and apprentices, and make sure software is updated for the effective date.
• Business mileage: the announced rate for the first 10,000 business miles is 55p per mile, with the rate above 10,000 miles rising from 25p to 35p. Confirm the effective date and scope before updating expense policies or payroll settings.
• Salary sacrifice: from April 2029, the National Insurance exemption for pension contributions made through salary sacrifice will be capped at £2,000 a year. Employers making substantial use of these arrangements should begin reviewing the implications with their advisers.
• Employer National Insurance: the rate is unchanged, but employers still need to budget for the additional costs associated with higher wages.

For a small employer, even a modest increase across several staff can put pressure on cash flow. Help clients work through the full cost and plan for it before the new rates take effect.

Self employed clients and Making Tax Digital

The announcement of paid paternity support for eligible self-employed fathers and partners is welcome. Clients will want to know who qualifies, when support begins and how to claim. Those details will matter as much as the headline.

The higher trading allowance will also help some clients with small trading incomes. Remind them that claiming the allowance replaces deducting actual expenses against that income. It will not always produce the better result.

Making Tax Digital for Income Tax also needs continued attention. Sole traders and landlords whose qualifying income exceeded £30,000 in 2025/26 will need to use MTD from 6 April 2027, subject to the applicable exemptions. Those whose qualifying income exceeds £20,000 in 2026/27 will come into scope from 6 April 2028. Qualifying income is gross income from self-employment and property combined, before expenses.

My message to members is to make those client conversations a priority. Identify who is affected, agree how their records will be kept and make sure they understand what they need to do. Choosing software is one part of preparation. Helping clients build the habits to use it consistently is just as important.

What to do this week

1. Check retail, hospitality and leisure clients’ rateable values and eligibility against the announced relief changes, including the relevant national rules and start dates.
2. Contact clients considering a business sale or retirement and recommend an early discussion with their tax adviser about Business Asset Disposal Relief.
3. Review landlord clients’ figures and cash flow ahead of the property income tax changes from April 2027.
4. Revisit employers’ payroll budgets and prepare to update minimum wage and mileage settings once the applicable rates and effective dates are confirmed.
5. Identify clients whose 2025/26 qualifying income exceeded £30,000 and agree their MTD preparation and software plan for April 2027. Begin identifying the April 2028 group too.
6. Check the final Budget documents and HMRC guidance before giving client-specific advice. Confirm eligibility, commencement dates and any transitional rules.

The value of professional bookkeeping

Small business owners need someone who understands their figures and can help them decide what to do next. Our members are well placed to provide that support.

That means spotting a change that affects a client, raising it early and knowing when specialist tax advice is needed. It also means keeping the records accurate throughout the year, so clients have reliable information when decisions need to be made.