The Autumn Budget has landed, the year is nearly over, and most directors are looking ahead to a quieter few weeks before Christmas. For a growing business, this is one of the most useful points in the year to plan. You have most of this year’s real figures, the main tax changes for 2027 are known, and there is still time to act on them.
This month we have looked at four planning conversations worth having now rather than in January: how the Budget changes the tax on selling your business, which clients and services make you money, whether your finance function depends too heavily on one person, and how to set next year’s targets using this year’s figures.
The Budget change that affects your exit
Business Asset Disposal Relief (BADR) lets qualifying business owners pay a lower rate of Capital Gains Tax when they sell all or part of their business. The BADR rate is currently 18%, compared with the 24% higher rate of Capital Gains Tax.
At the Autumn Budget on 28 October 2026, the government announced that the lifetime limit for BADR will fall from £1 million to £500,000 for qualifying disposals made on or after 6 April 2027. The rate itself stays at 18%. The change is still to be legislated in the Finance Bill.
What this means for you depends on the size of your gain. If your qualifying gains are below £500,000 and you haven’t claimed BADR before, nothing changes. If they are above £500,000, the slice between £500,000 and £1 million that would have qualified for the lower rate will instead be taxed at the standard rate. For a higher-rate taxpayer, that is up to £30,000 more tax over a lifetime.
Two points are worth knowing before you act:
- Agreeing a deal before April doesn’t automatically protect the old limit. There are specific rules for contracts and reorganisations that aren’t completed before 6 April 2027, so the timing of completion matters. Take advice before agreeing terms, not after.
- A new relief may apply to some owners. The Budget also announced Founders’ Relief: a 10% Capital Gains Tax rate on up to £10 million of lifetime gains for founders and early investors in high-growth, innovative UK companies, for disposals from 6 April 2027. The detailed qualifying conditions are under technical consultation until 30 November 2026, so it is too early to say who will qualify. Any BADR claimed from 6 April 2027 reduces the Founders’ Relief limit.
None of this is a reason to sell before you are ready. A sale should happen because it is right for the business and for you. But if an exit is on your horizon in the next few years, the timing, structure and tax position are worth reviewing now, while you still have options.
Knowing which clients and services make you money
Many growing businesses reach a point where turnover keeps rising but profit doesn’t. The team is busier than ever, yet the bottom line stays flat.
The cause is often hidden inside a single turnover figure. A standard profit and loss report shows total sales and total costs. It doesn’t show that a long-standing client is still on pricing agreed years ago, that a particular service takes far more team time than it is quoted for, or that a large account brings in revenue but very little profit once the hours are counted.
To see this, you need margin by client and by service, not just for the business as a whole. In practice that means:
- Recording sales by client and service line in your accounting software, using tracking categories or projects.
- Allocating direct costs, including team time, to the work that caused them.
- Comparing gross margin across clients and services, rather than revenue alone.
Once you can see it, the decisions get easier. Some work needs repricing. Some needs a tighter scope. Occasionally a client costs more to serve than they pay, and the right decision is to let that work go so the team can focus on clients who pay their way.
Your busiest client isn’t always your most profitable one, and without the numbers broken down there is no way to tell.
A finance function that doesn’t depend on one person
In many established businesses, one person knows the numbers better than anyone: a long-serving bookkeeper, an office manager who looks after the accounts, or a finance assistant who has built the processes over several years.
That person is usually an asset. The risk is in the setup around them. If they are off sick, on holiday or leave the business, it can quickly become clear how much of the finance function was never written down: how payroll is run, which suppliers are paid when, what a recurring month-end journal is for, or where the logins are kept.
Signs your finance function depends too heavily on one person:
- Payroll or supplier payments slip whenever they are away.
- Month-end reports stop when they are on leave.
- Nobody else could explain how your key figures are produced.
- Their work isn’t reviewed by anyone else.
An outsourced finance function reduces this risk because the work sits with a team following a documented process, rather than with one individual. It doesn’t have to replace your in-house team. Many businesses use it alongside an internal bookkeeper to cover absences, review the numbers each month, and take on the reporting and advisory work that one person can’t cover alone.
Good people are worth keeping. A resilient finance function makes sure the business doesn’t stall when any one of them is unavailable.
Setting next year’s targets before the Christmas slowdown
Most businesses set next year’s targets in January, after the break, often from memory, and with the first weeks of the year already gone.
By the end of November you have most of this year’s actual figures. That is the most reliable starting point you will have for planning next year, and it is worth using while the detail is fresh.
A practical approach:
- Start with your actual results to date. Look at which months were strong, where costs rose and which work produced the best margins.
- Decide the big moves: the hires you can afford, the prices that need to change, and the services or clients to grow.
- Model the cash. Check when the money for those decisions will be needed and when it will come in, including tax payments.
- Agree the plan before the break, so January is about delivering it.
If your month-end figures are up to date, this is a few focused hours of work. If they aren’t, getting them current is the first step, because a plan built on out-of-date numbers is a guess.
Planning ahead of 2027
Each of these conversations is easier to have now than in a few months’ time. The tax changes are known, this year’s numbers are mostly in, and there is still time to act before the new tax year.
If you’d like help reviewing your exit timing, your client profitability, your finance setup or next year’s targets, get in touch with J2 Accounting. We work with established, growing businesses to turn their numbers into decisions.
FAQs
What is Business Asset Disposal Relief?
A Capital Gains Tax relief that lets qualifying business owners pay a reduced rate, currently 18%, on gains when they sell all or part of their business, up to a lifetime limit.
When does the BADR lifetime limit change?
It falls from £1 million to £500,000 for qualifying disposals made on or after 6 April 2027, subject to legislation in the Finance Bill.
Will the change affect me if my gain is below £500,000?
If you haven’t claimed BADR before, a qualifying gain below £500,000 isn’t affected. If you have claimed it in the past, your remaining allowance may be lower, so it is worth checking.
Does agreeing a sale before April 2027 protect the £1 million limit?
Not necessarily. There are specific rules for contracts and reorganisations not completed before 6 April 2027, so take advice before agreeing terms.
What is Founders’ Relief?
A new Capital Gains Tax relief announced at the 2026 Autumn Budget. It offers a 10% rate on up to £10 million of lifetime gains for founders and early investors in high-growth, innovative UK companies, for disposals from 6 April 2027. The qualifying conditions are still being consulted on.
How do I work out which clients are most profitable?
Record sales and direct costs, including team time, by client and service in your accounting software, then compare gross margin rather than revenue.
Can I outsource my finance function and keep my in-house bookkeeper?
Yes. Many businesses use an outsourced finance function alongside internal staff, for absence cover, monthly review and management reporting.