Spring Statement 2026: What it means for your business

The Chancellor’s Spring Statement on 3 March 2026 was deliberately vague. Unlike the full budget, it acted as a check on progress in the UK economy rather than a platform for sweeping new tax measures.

The government has already said it is committed to the biggest fiscal event of the year, which includes key policy changes in the Autumn Budget in November.

However, “no new announcements” does not mean “nothing to prepare for.”

A number of previously confirmed changes will come into effect soon, starting in April 2026. Together they add up to significant changes in costs and compliance requirements for small businesses.

Here is what we discuss in this article:

Making Tax Digital for Income Tax

From 6 April 2026, sole traders and landlords with a qualifying income of more than £50,000—and currently using the self-assessment system—must keep digital records and submit quarterly updates to HMRC using MTD-compliant software.

We’ve talked a lot about MTD here at Sage Advice so, rather than repeat ourselves, here are some in-depth resources where you can learn more (although you can also view our MTD topic tag):

Research suggests that only about 30% of stakeholders are currently aware of MTD requirements.

As quarterly submissions and digital record keeping become mandatory, the administrative burden is real, especially for sole traders and home owners who manage their books.

What does this mean for businesses

If your income exceeds £50,000, you probably already have HMRC compliant software and should be keeping digital records.

If you don’t use the software, you should get something as an emergency (did you know Sage offers free MTD software?). In addition, be sure to use it to track income and expenses. With technologies like automated data entry, the AI ​​like Sage Copilot digital assistant, and food banking, this has never been easier.

Talk to your accountant and bookkeeper now about the quarterly posting process. If we can now handle all of your accounting and tax matters, they may be able to continue to do so—but you’ll need to give them your paperwork every three months, rather than every twelve months.

If you fall into the £30,000–£50,000 bracket, use this year to get your systems in place before the April 2027 deadline. Don’t wait until the last minute. And if your eligible income is £20,000 or more, then don’t forget that you will have to use MTD for income tax from April 2028.

Employer’s National Insurance Contributions, and wage increases

The Spring Statement for 2026 introduces new National Insurance (NIC) changes. The main employer NIC changes you need to know were previously announced and apply from April 2026, so make sure you check HMRC’s latest rates and thresholds for the 2026/27 tax year before making your first paycheck of the year.

We’ve covered this already here at Sage Advice, and you may find the following two articles helpful:

In summary, the employer’s second rate of First Class NIC remains at 15% (up from 13.8%), and the second threshold has dropped from £9,100 to £5,000 per year.

In practice, employers now pay NIC on a large proportion of each employee’s salary.

Note that income tax and NIC rates are suspended until April 2031.

From 1 April 2026, the National Living Wage for those aged 21 and over rises from £12.21 to £12.71 an hour, an increase of 4.1%. The rate for 18-20 year olds rises to £10.85 an hour, while the rate for 16-17 year olds and qualified students rises to £8.00 an hour.

What does this mean for businesses

Update your billing systems before April to reflect the new rates.

If you hire workers at or near minimum wage, show the impact on your total payroll. For businesses operating on tight margins, this is a good time to review pricing, planning, and production to absorb the increase.

In addition, check whether your business is eligible for Employment Allowance, which can reduce your employer’s annual NIC liability by £10,500.

Review your salary costs with the minimum wage in mind and think about how this affects hiring decisions. Budgeting for the full cost of the job, not just the total salary, is important.

Business values

The new rates come into effect from 1 April 2026, meaning business rate bills could change for many properties.

Pubs and music venues in England benefit from a 15% business rates discount for 2026–27, with rates suspended for another two years.

For many other small businesses, however, rates are expected to increase. Remember that rates are set by local authorities, not central government.

We’ve covered all of this in depth in our Autumn Budget 2025 article here at Sage Advice.

What does this mean for businesses

Check your new rate on the Valuation Office Agency website and challenge it if you believe it is wrong.

If you own a bar or music venue, make sure the 15% discount is applied to your bill. All businesses must include the revised amounts in their cash flow forecasts for the coming year.

SME lending

Although not linked to the Spring Statement, the government recently announced an £11 billion SME lending package backed by five major banks: Barclays, Lloyds Banking Group, NatWest, HSBC UK, and Santander UK.

This is aimed at supporting business growth and helping small businesses access the capital they need to invest.

What does this mean for businesses

If you are planning a major investment, expansion, or need working capital to manage rising costs, check out the loan options available at these banks.

Prepare a clear business case and up-to-date financial records to substantiate any application. Some software, like Sage’s Futrli, makes it easy to prepare “board packs” for this type of scenario.

Business Liquidation Assistance

The Capital Gains Tax rate on qualifying Business Asset Disposal Relief (BADR) gains increases from 14% to 18% from 6 April 2026.

The lifetime limit is always up to £1 million.

This is relevant for any business owner who plans to sell or wind up their business, as it increases the tax payable on qualifying exits.

What does this mean for businesses

If you are considering selling your business or transferring assets, schedule an appointment with your tax advisor.

Works completed before 6 April 2026 will benefit from a lower rate of 14%. For long-term plans, include a higher price in your exit strategy.

The Employment Rights Act is changing

Major changes under the Employment Rights Act are set to come into effect from April 2026, including changes to statutory sick pay and paternity leave. Some areas, such as the regulation of zero-hours contracts, are still subject to secondary legislation, so detailed rules and exact start dates are subject to change.

We’ve discussed this in our year-end salary tips here at Sage Advice, so start there if this is new to you:

What does this mean for businesses

Review your employment contracts and employee handbooks to ensure they are up to date. If you are using zero hours contracts, keep an eye on developments as the second zero hours rule is finalized.

Final thoughts: Looking ahead

The 2026 Spring Statement confirmed the government’s focus on economic stability, growth, adoption of AI, and tackling youth unemployment.

Although no new tax measures have been announced, the cumulative weight of previously confirmed changes means that April 2026 is a busy month for small businesses. Rising employment costs, new compliance obligations, and reduced tax exemptions all demand attention.

The most important step any small business owner can take now is to review how these changes affect their particular circumstances. Talk to your accountant, review your plans, and plan ahead. An active approach will put you in a much stronger position for the coming year.