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Gunner & Co. are not accountants, tax advisors, or legal professionals. The content in this article does not constitute financial, tax, or legal advice.

For owners planning a business sale, understanding the changes introduced in the 2025 Autumn Budget can materially affect timing, structure and value.

10 Things You Need to Know

The 2025 Autumn Budget delivered a series of tax updates that matter for owners preparing to sell in the coming years. While this was never expected to be a tax-cutting Budget, sellers can take reassurance that capital gains taxes remained stable and that Business Asset Disposal Relief (BADR) survived intact. Even so, several subtle but significant shifts mean forward planning matters more than ever. If you are thinking about an exit, it is essential to understand how these changes affect both structure and timing.

Below are the 10 most important points to consider when reviewing your sale plans.

1. Capital Gains Tax considerations after the 2025 Autumn Budget

CGT rates remain unchanged, leaving the top rate at 24%. This continues to compare favourably with income tax rates and supports business sellers. The long-standing question of whether CGT could align with income tax remains unresolved. Any future change would likely involve tapering rather than a sudden increase. In the current environment, delaying a sale in the hope of lower rates is unlikely to deliver benefits.

2. BADR changes following the 2025 Autumn Budget

BADR remains available but offers reduced value compared to previous years. The rate increased this year and will rise again next April, moving from 14% to 18%. Despite this change, BADR still delivers meaningful savings for many sellers. Timing now plays a critical role. Owners need at least two years of advance planning to meet qualifying criteria, particularly around shareholdings, voting rights and employment status.

3. Dividend tax increases create timing considerations

Dividend tax rates will rise by 2% from next April. This change increases pressure on directors to reassess remuneration strategies. Some owners may accelerate dividends into the current tax year, provided this does not trigger the personal allowance taper. For others, the traditional low-salary and dividend approach may no longer offer the best outcome. A fuller salary may prove more efficient.

4. Cash in the business needs careful handling

Many owners hold surplus cash within a company before a sale. Extracting funds on completion can allow taxation as capital rather than dividend rates. While this strategy can work, excessive cash balances may raise BADR concerns. Cash invested or moved into higher-interest accounts can resemble investment activity. This may put the company’s “wholly or mainly trading” status at risk. Clear documentation and sensible management remain essential.

5. Share sales are becoming harder to secure

The market continues to move away from share purchases, particularly for smaller firms. Increased due diligence, regulatory complexity and exposure to historic liabilities make asset purchases more attractive to buyers. Sellers should not assume a share sale remains viable. Early clarity on deal structure enables better tax planning and smoother buyer engagement.

Keen to understand if you would meet the threshold for a share purchase? Book a Free Consultation with Gunner & Co.

6. Tax implications of asset sales after the 2025 Autumn Budget

When a transaction requires an asset sale, the company pays corporation tax on gains from goodwill and asset disposals, often at 25%. The proceeds then remain within the company. Shareholders must extract funds separately, typically through dividends or liquidation. Liquidation can allow CGT treatment, but BADR requires completion within three years. This timeline plays a critical role in exit planning.

7. Structuring changes now need more lead time

The 2025 Autumn Budget introduced tighter anti-avoidance rules around share reorganisations and share-for-share exchanges. These changes affect scenarios involving holding companies or asset separation before a sale. HMRC clearance now takes longer, and scrutiny has increased. Owners should begin structural planning well ahead of any transaction.

8. Inheritance tax exposure following the 2025 Autumn Budget

Business Property Relief (BPR) has been reduced. From April 2026, the first £1 million of qualifying assets retains 100% relief. Assets above this threshold qualify for 50% relief. This change increases inheritance tax exposure for owners of higher-value businesses. A positive development allows spouses to transfer the £1 million allowance, adding flexibility to estate planning.

9. Deferred consideration brings tax complexity

Fixed deferred payments usually trigger tax at completion, even when payment occurs later. Earn-outs tied to future performance require upfront valuation. This process can prove difficult and may affect both corporation tax and CGT calculations. Equity consideration adds further complexity. Early, tailored advice helps owners structure deals more effectively.

10. Employee Ownership Trusts lose some of their tax appeal

The CGT exemption for Employee Ownership Trust disposals has been halved. While EOTs still suit some businesses for cultural reasons, their tax appeal has weakened. They also introduce challenges around funding, employee expectations and long-term growth. These structures now suit specific situations rather than acting as a broad alternative to traditional sales.

Planning your next steps

The 2025 Autumn Budget did not rewrite the rulebook. However, it reinforced the value of early, informed planning. Reliefs remain available, but conditions have tightened and timelines have lengthened. Understanding your likely route to market, assessing deal structure and preparing your business all take time. Owners who start early consistently achieve stronger outcomes.

Thinking about selling your business?

If you are considering an exit in the coming years, our team can help you understand the market, prepare for due diligence and build a clear value-protection strategy. Speak to us in confidence to explore the most suitable route for you and your clients.

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