11 Tax Changes in April 2025 that small businesses need to know about

Wednesday’s much anticipated Spring Statement brought few surprises, with Chancellor Rachel Reeves focusing on spending cuts rather than raising taxes. However, it did confirm that a number of previously announced changes will come into operation from April 2025: here’s the round-up of what small business owners need to know.

As announced in the Autumn Budget, Employers’ National Insurance Contributions (NIC) will increase from 13.8% to 15% from 6th April. At the same time, the threshold at which employers begin to pay NI on an individual’s salary will be reduced from £9,100 to £5,000.

What does this mean for you? According to HMRC, an estimated 940,000 employers will see an increase in their NIC liability.

The Employment Allowance will increase to £10,500 and will no longer be restricted to employers with previous secondary NIC tax bills of £100,000 or less, making it more widely accessible.

What does this mean for you? For many SMEs, this will mean higher payroll costs, particularly for those expanding their teams. However, it will provide some relief to the increase in Employer contributions for the smallest employers.

As previously announced in the Autumn Budget, the National Minimum Wage will rise from £11.44 to £12.21 per hour for those aged 21+, while those aged 18-20 will also receive £12.21 per hour, and under 18s will receive £7.55 per hour.

What does this mean for you? This might be a good time for employers to review salary packages and consider employee salary sacrifice options where applicable.

HMRC has been given more funding to strengthen compliance systems and penalties for late payments will increase for both VAT and Income Tax Self Assessment taxpayers.

What does this mean for you? There is likely to be greater scrutiny around VAT, PAYE and Corporation Tax. Digital record-keeping requirements will be more closely monitored, and penalties for late or incorrect submissions will be tougher. If your business is still relying on manual processes, now is the time to review your systems.

From 1st April (for companies) and 6th April (for individuals, trusts and partnership), income from furnished holiday lets (FHL) will be taxed as standard rentals. Additionally, an FHL will no longer be eligible for beneficial capital allowances treatment, while eligibility for existing reliefs will cease.

What does this mean for you? This will affect investment returns and exit strategies for landlords.

The Stamp Duty Holiday is due to end on 31 March 2025, with thresholds for the rates of Stamp Duty Land Tax (SDLT) reverting to the levels they were at before they were increased in the 2022 mini-budget. From 1st April, Stamp Duty will be payable on the purchase price of properties over £125,000.

What does this mean for you? If you are looking to purchase a property, this is something that should be factored into your planning.

The rate of Business Asset Disposal Relief, which gives business owners a lower rate of CGT on qualifying gains, will increase from 10% to 14%, and will increase further (to 18%) in April 2026.

What does this mean for you? If you are looking to dispose of assets prior to 5th April 2026, there is still the opportunity to make a small tax saving (although please note that the £1m lifetime limit still applies).

As previously announced in the Autumn Budget, the basic rate of Capital Gains Tax is now 18%, with higher and additional rates set at 24%. Trustees and personal representatives are also subject to the 24% rate.

What does this mean for you? If you are planning to sell a business or shares, careful timing could make a big difference to your tax bill.

From 6th April, double cab pick-ups (DCPUs) will be treated as cars rather than commercial vehicles.

What does this mean for you? This change will mainly impact farm businesses, meaning that DCPUs no longer qualify for Annual Investment Allowance but will instead be subject to the same capital allowances as cars.

There are no changes to the VAT threshold, which remains at £90,000, or Corporation Tax, which stays at 25% for profits over £250,000. Additionally, full expensing and the £1 million Annual Investment Allowance continue to be available for qualifying investments.

What does this mean for you? These reliefs remain valuable for businesses looking to invest and grow.

As previously announced, the group of self-employed individuals and landlords impacted by Making Tax Digital (MTD) for Income Tax Self Assessment (ITSA) will be expanded from April 2026.

Those with income over £50,000 will be required to comply with MTD ITSA from April 2026, with self-employed individuals and landlords earning over £30,000 following in April 2027, and those earning above £20,000 following in April 2028.

Additionally, quarterly digital submissions will become mandatory.

What does this mean for you? If you are still relying on spreadsheets, it’s worth starting to prepare now.