Spring Budget announcement: Act now

By Harley Maye

Following the Government’s Spring Budget announcement, business leaders are unlikely to be significantly impacted by any immediate changes. The UK will encounter economic challenges in the year ahead, but those looking to buy or sell businesses can draw a sigh of relief.

Despite economic obstacles, some growth is projected, leaving the market in a familiar position in which buyers will continue to seek acquisition opportunities. For business owners contemplating a sale, the key question remains: when is the optimal time to proceed?

Before the 2024 Autumn Budget announcement, there had been speculation amongst experts that the UK would see a significant increase in Capital Gains Tax (CGT). Some predicted that CGT rates could rise exponentially, potentially to a figure between 40-45%.

However, the actual changes were less severe than anticipated. The higher CGT rate increased from 20% to 24%, while the basic rate rose from 10% to 14%. Business Asset Disposal Relief (BADR) stands at 14% but will increase to 18% in April 2026.

In the Autumn statement, Chancellor of the Exchequer Rachel Reeves emphasised that “the UK will still have the lowest Capital Gains Tax rate of any European G7 economy”. While this provided some reassurance, especially given the concerns leading up to the announcement, it is important to note that any increase in CGT is still impactful for those affected.

For business owners considering an exit, this presents a key opportunity. The lower BADR rate should be taken advantage of, and selling a business before the planned increases can result in significant tax savings. Acting promptly can help reduce the tax burden on any sale.

If you are contemplating selling your business, now is an opportune time to explore your options. One of our experienced advisers will provide guidance on how to minimise your CGT liability and therefore maximise the potential profit you receive during your company exit.

Your dedicated expert can also explore sale avenues that are entirely free from CGT. Get in touch now.