Starting and selling a business
Complex economic outlook
Anyone contemplating starting a new business, especially a bricks and mortar one, needs to factor in current and forecast economic conditions. The UK economy performed quite well for the first quarter of 2025, but growth for the second quarter was more muted, and forecasts for the remainder of 2025 show little improvement; the latest forecast is that the UK economy will grow by a fairly modest 1.2%. Despite the recent trade deal with the United States, imports from the UK are still subject to the baseline 10% tariff. This baseline tariff, along with continuing global tensions, are likely to dampen UK growth for the foreseeable future.
Inflation has generally been slowly rising throughout 2025 so far, and now sits at 3.8% (August 2025), well above the 2% target. Forecasts for 2025 as a whole don’t show much improvement. Then there are the increased costs which many businesses are faced with since April 2025. There has been a substantial increase in employee costs, with the result that many existing business owners have had to cut staffing levels and put future recruitment on hold. Business rates bills have more than doubled for a lot of businesses because the 75% discount for retail, hospitality and leisure businesses has been reduced to just 40% for 2025/26. So 60% of the full bill is now payable, rather than 25%.
When it comes to selling a business, it doesn’t matter whether you are developing a business idea to quickly cash in before starting all over again (the typical serial entrepreneur), planning a smart career move (with the successful sale of a self-started business looking very good on your resum.) or are in for the long haul – planning your exit strategy at an early stage will ensure you don’t pay more tax than necessary. This might be just the time to do that planning, especially as the rate of CGT payable where business asset disposal relief is available is going to increase by 4% from next April.
