Budget 2026: What Business Owners Need to Know
Tuesday, 3rd November 2026Written by Richard Coulthard, Director & Head of Corporate at Ison Harrison
After much debate as to what may or may not have been covered in the budget, we now know the outcome, well at least in part. The Budget 2026 contains several important proposals for business owners, founders and those considering buying or selling a company.
For many privately owned businesses, however, two areas stand out: changes to the tax treatment of business sales and the proposed reform of non-compete clauses.
Much of the detail is still to come, making the draft Finance Bill 2026-27 particularly important.
Founders’ Relief could transform some business sales
From 6 April 2027, the Government proposes to introduce a new Founders’ Relief, offering qualifying founders of high-growth, innovative companies a 10% Capital Gains Tax rate on up to £10 million of lifetime gains.
For qualifying entrepreneurs contemplating an exit, that could be extremely valuable.
However, there is an important word of caution. The detailed qualifying conditions have not yet been finalised. A technical consultation will inform legislation in the Finance Bill 2026-27.
Business owners should therefore not assume that simply founding or incorporating a company will be enough to qualify. The eventual definition of a qualifying founder and a high-growth, innovative company will be critical.
Our view is that this proposed relief is to bring the UK more in line with reliefs available to entrepreneurs in the USA, with the clear aim of attracting more talent, particularly in the tech sectors and AI, to develop businesses in the UK. Whilst the wording is not yet known, we predict that this Founders Relief will be geared towards businesses which could be founded in diverse jurisdictions with the aim of getting entrepreneurs to choose the UK.