Latest / The 3Bz Podcast - Building Better Business / EP140 - The Budget Changes That Will Hit Your Wallet First

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EP140 - The Budget Changes That Will Hit Your Wallet First · The 3Bz Podcast - Building Better Business

• 0:01
  Hi there, business owner, and welcome to the Three BS Podcast,
• 0:04
  the place where we go beyond the numbers and dive into strategies
• 0:07
  to help you build a Better Business one step at a time.
• 0:11
  I'm your host, Stephanie, a multi awarding entrepreneur with
• 0:13
  over a decade of experience in the bookkeeping and currency
• 0:16
  world. If you're a business owner
• 0:17
  looking to streamline, grow, and get back the time that you
• 0:20
  deserve. You're in the right place.
• 0:22
  Tackling real world problems, answering tough questions and
• 0:25
  digging deep into business building secrets in just 15
• 0:28
  minutes. Each week.
• 0:30
  So Are you ready to? Build a Better Business with
• 0:32
  confidence and clarity, then let's go.
• 0:36
  Hello and welcome back to another episode of the Three BS
• 0:39
  Podcast. Your go to place for 15 minutes
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  of CPD certified inspiration, motivation and education every
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  week. Now, if we've not met before, my
• 0:48
  name is Stephanie. I am an entrepreneur with over a
• 0:49
  decade of experience in the bookkeeping accountancy world.
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  Multi award-winning podcaster, author, speaker, really caring
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  about businesses and humans behind the businesses, helping
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  them build better businesses. If you're listening to this
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  episode, we're switching gears a little bit today.
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  I want to talk about the Autumn Budget that was announced last
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  week because I think it's really important to see what that means
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  as a human, as an individual as well as a business owner.
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  It's for employees, families, renters, savers, the human side
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  of the Autumn Budget 2025. Because while the business world
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  feels the tax rises one way, ordinary households are going to
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  feel it another. And most business owners are
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  humans too, and they have families and households to run
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  just the same as their businesses.
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  So let's get into the real impact, not the political
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  headlines of how it's going to affect you as an individual.
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  First things first is the stealth tax, I think they're
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  calling it. Thresholds are frozen until 2030
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  for National Insurance, VAT and income tax.
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  National minimum wage rates are increasing, which means, yes, if
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  you're on national minimum wage, you're about to get a pay rise.
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  Congratulations, but what that means is because the threshold
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  is frozen, you're more likely to go over that threshold and into
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  paying tax, which actually means that increase is not what you
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  feel in your pocket. A great example of this is if
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  you're on minimum wage on a full time contract 37 1/2 hours a
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  week. Your current take home based on
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  2526 prices at 12/21 an hour is £1984 a month and then after
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  your income tax, your National Insurance and your pension
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  contributions have been taken off, your take home is 1663 lbs.
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  Following the new introduction of the increase to £12.71 an
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  hour from April 2026, your income will be 2065 LB a month
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  and your take home pay after all the deductions will be 1719
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  which is an increase of £56 per month in your pocket.
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  Not only does that push more people into paying tax at the
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  basic rate, it also means more people are put into the 40% tax
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  band. Now to be clear, and I explained
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  this on last week's episode, that 40% tax band is not
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  immediately your entire income. The bands are stayed the same
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  even if your income increases. So you'll get your 12,570
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  personal allowance, you'll get 37,000 pounds, 500 on top of
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  that at 20%. And then we go up into the next
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  threshold of 40%. And then the higher, higher
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  threshold at the end, it's a pay more tax not realizing
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  situation, which is why I thought this episode was so
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  important to share with you because actually the the effect
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  of the income tax on the headline doesn't actually mean
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  that much more money in your pocket.
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  If you earn interest on your savings outside of Isas or
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  pension income from April 2027, the tax you were charged on that
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  is going to increase by 2%. So the basic rate becomes 22%,
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  the higher rate becomes 42% and the additional rate becomes 47%.
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  If you save, then this effects you.
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  If you've moved cash out of investments into high interest
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  savings accounts, this effects you too.
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  And if you rely on your personal savings allowance, this really
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  matters. Property income.
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  If you rent out property to another person, then as a
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  landlord your property income is going to be increased by 2% from
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  April 2027 too. If you are someone who rents a
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  property rather than mortgages. If you don't own your home and
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  you rent your home as an individual, because the tax is
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  increasing on property income, there's higher mortgage rates,
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  lower relief. Renters are likely to see this
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  passed on to them. So the rents, your rent is
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  probably going to go up because the landlord's costs have gone
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  up too and the cost of living nothing's really changing.
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  They did announce some new energy support and they are
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  moving some of the greener levers, which means our
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  household gas and electric bills should hopefully be reduced by
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  around £150 a year. Again, not a lot, but it's
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  something. There's no new cost of living
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  payments. There's no major household tax
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  cuts. You own a house and it's worth 2
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  million or more. You will be getting what's been
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  dubbed the mansion tax, so you'll get a £2500 bill on top
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  of your council tax from your council.
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  If your home is worth £5 million or more, you'll get 7500 LB
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  charge on top of your council tax.
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  That will come into effect from April 2028.
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  As I mentioned in last week's episode 2, fuel duty has been
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  frozen for another five months until September 2026.
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  Now what that means is the cost of the pump shouldn't move for
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  the for the next extra five months that was due to end in
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  April or next. They've extended it till
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  September. And the government also
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  announced that there is going to be some sort of scheme set up so
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  that so that when the wholesale prices of petrol fluctuate, the
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  petrol garages, the petrol garages have to pass on that
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  savings or that increase. They can't inflate prices if the
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  wholesale price goes down a petrol, which I think will be
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  very beneficial for us. A big headline was that the
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  Universal Credit to child cap has is being lifted, which means
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  you are not going to be penalized if you have on two
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  children and you are on Universal Credit.
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  The state pension will still rise under the triple lock as it
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  does every year annually and usually that means that the
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  benefits do too, but I didn't see confirmation for that in the
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  autumn statement so it is worth double checking that.
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  Usually your other benefits if you have disabled children and
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  your your DLA or your personal independent payment PIP if you
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  are disabled. That usually goes up by
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  inflation each year. They I didn't see any
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  confirmation of that either way, so that's something to keep an
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  eye out for. From April 2026 electric vehicle
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  costs. From 2028, electric vehicle
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  drivers pay per mile Rd. tax. What that means is if you have
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  an electric vehicle, you'll be charged 3 pence per mile.
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  And if you have a hybrid vehicle, you'll be charged 1.5
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  pence per mile that you have driven in that vehicle in the
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  year and you'll pay that annually alongside your vehicle
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  Rd. tax. And I know that obviously
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  electric vehicles used to be free and that's gone up now, but
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  traditional drivers still pay for your duty, the vehicle
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  excise duty itself. So the road tax we pay on our
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  vehicles is going to rise again above inflation.
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  So transport costs continue creeping up.
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  However, Rachel Reeves did announce that rail fares will be
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  frozen. The freeze on bus fares will be
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  extended, and the cost of a prescription is being frozen
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  too, which as we know has gone astronomically in the last few
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  years. So again, those little things
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  will hopefully make things slightly easier, kind of just
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  take the edge off. Don't know, you make things a
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  little easier. The household trying to run a
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  budget and keep a roof overhead and food in our bellies.
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  The OBR. So the Office of Budget
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  Responsibility do announce their predictions and they did
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  announce that they think inflation will be nought .4%
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  lower next year. But they also forecast that
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  there will be fewer house house purchases, slower price growth,
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  stretched affordability and higher borrowing costs for even
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  longer. So if you're an existing
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  homeowner, yes, it's hard right now, especially if your mortgage
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  is due for renewal and your products come to the end of its
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  cycle. If you're a renter, is it
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  tricky? Absolutely.
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  Trying to get on that house and the other is not an easy thing.
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  And I think the OB Rs forecast for inflation and growth and the
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  cost going up for us all as the cost of living is making it even
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  harder. So what should individuals do
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  right now? If I was you, one, make sure
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  you're using those Isas saving taxes rise from April 2027.
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  You need to use those allowances to their fault if you can.
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  Rachel Reeves announced. As it stands it's £20,000 per
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  year you can put into a cash ISA tax free without being charged
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  savings tax on it. She did announce that what's
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  going to happen is it's going to be 8000 LB for investments,
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  12,000 LB for cash. Unless you're aged over 65, in
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  which case £20,000 cash limit will still apply to you.
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  That is to get encourage people to invest more.
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  And I understand why she's doing it and more information will
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  come out on that before April 2020 seventh.
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  So we may cover it on a later podcast episode.
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  But it's something to be aware of and start getting into the
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  habit now to revisit your pension contributions.
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  Salary sacrifices loses its tax benefit from April 2027 too.
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  So before, if you had a salary sacrifice by a pension scheme,
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  if you're employed, then is your pension scheme salary sacrifice
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  or is it not? That's something to go and check
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  and be aware of. From 2027, employers and
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  employees National Insurance will be charged on salary
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  sacrifice pension contributions, which means you're going to get
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  less put in the pension. It's going to cost your employer
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  more to contribute their auto enrolment percentage too, which
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  means you're going to have less in your pension overall. 3
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  Review your household budget. Costs won't fall, they'll just
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  rise more slowly. I think we've all noticed when
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  we go to the supermarkets to do our grocery or food shop that
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  the costs are more now than they've ever been.
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  And that is going to rise, but it's going to be slower than it
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  was before. So that's something to take into
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  consideration with your household budget when you know
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  how much you're putting away each month for food out of your
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  income for if you're planning to buy a home, expect fewer
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  bargains. Lower prices don't automatically
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  mean a better affordability. Definitely go and see a mortgage
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  advisor. Go and speak to them.
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  A lot of them will offer like a free consultant discovery call
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  like we do at ABCSUK. Go and have those conversations.
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  Understand the position you're in, what you can and can't
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  afford from a mortgage affordability basis when you're
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  looking for that that house to get on the ladder or move to a a
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  different home. And five, please go and get
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  advice from a financial advisor before withdrawing savings or
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  investments. The tax landscape has just
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  changed and the way that it's always been is not the way it's
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  going to be going forwards. Somebody once said to me that
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  the Autumn Budget and statement is a little bit like being a
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  doctor and that every six months they rearrange all the organs
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  and expect you still to operate on the body and get the
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  operation done nice and smoothly.
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  It's like that for accountants and financial advisors as well.
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  So as these tax changes are happening, as they're going to
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  continue to keep changing, go and speak to an expert because
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  they'll be able to advise you on the best route to take.
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  They'll be able to advise you on your position, your options, and
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  any changes that may impact you positively or negatively.
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  So that's the Autumn Budget Roundup individual edition.
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  So if you want the business owner version, go back to
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  episode 139. If you want both, listen twice,
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  take notes. Whether you're on the dog walk,
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  school run, making a cup of tea, do what you've got to do.
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  If you need support, you're on a 15 minute call.
• 11:23
  Jump in my diary. We can get on a virtual call,
• 11:25
  discovery call abcsuk.com. Even if you don't own a
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  business, I'm happy to give you 15 minutes of my time to help
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  reduce that worry, that uncertainty and get clear on
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  what these changes actually mean for you and your unique
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  circumstances. And please for the love of God,
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  do not listen to Dave down the pub unless he's a certified
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  expert because the amount of time people come to us.
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  But my mate said but they don't understand your unique
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  circumstances and that you've got property income or you rent
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  something out and or you've got a job and a side hustle.
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  So go and speak to an expert. I don't need to get into any
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  more stress or worry or trouble. Go and see an expert.
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  Look into my diary if you want to speak to me and I'll help you
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  make the most of these changes in the budget.
• 12:09
  If you found this episode useful, please do like rate and
• 12:12
  review, subscribe on YouTube so you get a 15 minute episode
• 12:15
  every Thursday. It really helps me get this
• 12:18
  business. It really helps me get this
• 12:19
  podcast out to more business owners so we can all build
• 12:23
  better businesses. I've been Stephanie Marshall.
• 12:25
  I hope this has been helpful and I'll see you for the next
• 12:28
  episode. Bye.
• 12:31
  And that brings us to the end of another episode of the Three
• 12:34
  Bees podcast. I hope you found it useful and
• 12:36
  that you're walking away with some motivation, inspiration, or
• 12:39
  education to help you. Build a better.
• 12:42
  Business Don't forget to subscribe, leave a review and of
• 12:45
  course, connect with us on social media for more insights,
• 12:47
  tips and behind the scenes content.
• 12:49
  Your next step in building a Better Business is just a click
• 12:51
  away. I can't wait to connect with you
• 12:53
  and I'll see you on the next episode.
• 12:55
  Bye.