What the Autumn Budget Means for Small Businesses in 2025

The Chancellor’s Autumn Budget 2025 has now landed, setting out the government’s latest plans for spending, taxation, and business support across the UK.

For small business owners in Cardiff and beyond, this annual announcement can have a big impact - from changes to business rates and tax thresholds to new funding opportunities and incentives.

If you’re running a startup, freelance business or SME, here’s a breakdown of what the 2025 Autumn Budget means for small businesses, and how to make the most of the changes as you head into the new year.

💷 1. Business Rates Relief Extended for SMEs

Good news for small businesses: the government has confirmed an extension of the 75% business rates relief for eligible retail, hospitality, and leisure businesses into 2026.

For independent cafés, salons, and boutiques—many of which call Cardiff home,

this is a welcome continuation, helping to ease the pressure of high overheads.

Meanwhile, the Small Business Rates Multiplier will remain frozen for another year, offering stability for those renting office or commercial space.

➡️ If you’re operating from a serviced or flexible office like Space2B, you may already benefit from inclusive rates - another way to simplify your costs heading into 2026.

📈 2. Corporation Tax & National Insurance: No Major Shocks

The Chancellor kept things steady on corporation tax, which remains at 25% for profits over £250,000, and 19% for small profits (under £50,000).

There were, however, minor adjustments to National Insurance thresholds, aimed at easing costs for both employers and the self-employed.

• Class 4 NICs (for self-employed) – slightly reduced to support freelancers and contractors.

• Employment Allowance – remains at £5,000, giving smaller employers a bit of breathing room on staffing costs.

These measures may not transform your balance sheet, but they help create a sense of stability - something small businesses can definitely use after a few turbulent years.

💡 3. Increased Support for Startups & Innovation

A key focus of this year’s Statement is encouraging innovation and entrepreneurship - especially across regional cities like Cardiff.

Highlights include:

• Continued funding for Innovate UK to back research-led businesses

• Expansion of the British Business Bank’s Start Up Loans scheme, giving founders easier access to low-interest loans

• Digital Skills Vouchers pilot, aimed at helping small businesses upskill in AI, cybersecurity, and marketing tech

For startups and freelancers looking to level up, now’s the time to take advantage of these national initiatives.

➡️ Pair that with a professional base in a business hub like Space2B, and you’ve got the perfect environment to grow.

🏢 4. Incentives for Green and Energy-Efficient Businesses

The government reaffirmed its commitment to sustainability, introducing tax deductions for businesses investing in energy-efficient upgrades, such as LED lighting, solar panels, and heat pumps.

If your workspace is in a modern, energy-efficient building, you could see long-term savings - while contributing to your company’s net-zero goals.

➡️ At Space2B, sustainability is built into the design - from shared energy-efficient systems to accessible public transport links for your team.

🧮 5. Simplifying HMRC and Digital Tax Filing

Making Tax Digital (MTD) continues to roll out across smaller businesses, with new software support grants announced for microbusinesses still transitioning.

From 2026, all VAT-registered businesses will be required to file digitally, but the government has promised simplified reporting tools and free training resources to help business owners adapt.

For freelancers and consultants, this means less paperwork - and more focus on clients and growth.

🔄 6. Funding for Regional Growth in Wales

Cardiff and South Wales are set to benefit from new regional investment funding, aimed at improving business infrastructure, transport and innovation spaces.

This includes:

• Support for the Cardiff Capital Region’s Innovation Programme

• Investment in digital connectivity and business hubs

• Additional grant funding for Welsh SMEs through local councils and Business Wales

➡️ For growing businesses in Cardiff, this could mean more access to funding, better facilities, and even greater community support, exactly what hubs like Space2B are built around.

✨ Final Thoughts on the Autumn Budget 2025 for Small Businesses

The 2025 Autumn Statement offers cautious optimism for small businesses - steady taxes, extended reliefs, and more support for innovation and digital growth.

For freelancers, founders, and small business owners, the key takeaway is to stay proactive: make use of funding, go digital where possible, and focus on spaces that help you grow sustainably and flexibly.

At Space2B, we’re proud to support Cardiff’s business community through flexible offices, meeting rooms, and co-working memberships - designed for the way you work today.

Looking to make 2026 your most productive year yet?

👉 Explore workspaces at space2b.wales