Don’t Let the Autumn Budget Headlines Panic You

Generally, budgets come with an element of trepidation, and especially when there’s been a change in government. And, because of the provocative style of reporting our mainstream media adopts, it’s understandable that for many, there’s a natural inclination to panic or make knee-jerk decisions in response. 

But, while this budget isn’t perfect, it’s not as severe as some of the more sensationalised reports suggest. So, rather than getting swept up in the noise, now is the time to take a breath and look in more detail at the ways these changes might impact your business. You might be pleasantly surprised that in some areas, things aren’t quite as drastic as they first seem.

Avoid knee-jerk reactions

Unfortunately, the media tends to focus on certain budget aspects that are easy to sensationalise – for example, the inclusion of pensions in inheritance tax. What’s important to remember, is that a budget covers a wide range of adjustments, some of which may even benefit small businesses. However, these positive elements often get little to no coverage in mainstream reporting.

When it comes to financial decisions that impact your business, reacting solely to headlines is risky. It’s far better to avoid making hasty decisions and instead take a balanced look at your specific situation. The fact is, there’s no one-size-fits-all with these things, and what may seem concerning at first glance could have a relatively minor effect or, in some cases, even a positive one.

Take a full financial view

Rather than homing in on isolated elements, it’s really important you take a step back and assess the full picture. The Autumn Budget affects different businesses in different ways, and only by examining all the pieces together can you see the true impact on your business. In times of change, perspective is essential, and a thorough review can offer that.

Approaching things in this way not only prevents unnecessary worry, but also allows you to make more informed, confident decisions. Instead of reacting to media noise, focus on specific areas and how they apply to your business.

Real-world examples of taking a calmer view

To help you understand why things aren’t always as they initially seem, I want to share a couple of examples of clients who initially felt anxious about the increase to 15% with employer’s National Insurance, but how a deeper dive into the numbers gave them a different picture. 

One client has a business with a gross payroll of £100,000 and four employees. They were initially convinced this would have a detrimental effect on their bottom line. But when we examined the full details, we found that the business would actually be £2,000 better off in April than they are now. The reason? The Employment Allowance was bumped up, which helps smaller businesses like theirs manage their NI contributions despite the rate increase and threshold adjustments.

Another client with a higher gross payroll of £318,000 and five employees on higher salaries feared the increase would have a significant impact on their expenses. After we reviewed their numbers, they found they’d only be £900 worse off – a figure much lower than they initially anticipated. While of course any loss is not ideal, it’s manageable and far from the huge amount they were fearing. 

The thing to recognise from these examples is that these changes will impact every business differently, so you must run your numbers and look at things based on your specific circumstances.

Look beyond the headlines

While it’s tempting to focus on specific headlines, like changes to pensions and inheritance tax, it’s crucial to see these changes as part of a much broader budget. 

Adopting a 360 focus helps you understand the practicalities, avoid unnecessary stress, and find areas that may work in your favour. And of course, there are things to be grateful for that haven’t been introduced, such as employers’ NI contributions on pension inputs (something many were worried about), which is a positive for many businesses.

Get support to understand your position

If you’re feeling uncertain, don’t sit in overwhelm or make rash decisions, please reach out for help. Get in touch and together we can look at your numbers and discuss any concerns you have. We’ll work with you to figure out exactly what the Autumn Budget means for your business, whether it’s a payroll adjustment, a potential tax implication, or something else.

For specific areas where we don’t provide direct advice, such as Inheritance Tax, we’re more than happy to put you in touch with trusted specialists. They can do a full review of your estate and offer potential solutions. Additionally, if you’re in need of an Independent Financial Advisor (IFA), we have connections we’d be glad to share.

And, if you’d like to look more closely at the details of the Autumn Budget, we’ve put together a handy summary with lots of helpful tips – you can download our summary HERE. 

Remember, it’s crucial to keep a level head and avoid panicking or making swift decisions based on limited information. Instead, take a measured approach, and assess the budget’s impact on your individual business so you can respond strategically and confidently to whatever changes come your way.