Question to the HM Treasury:

To ask His Majesty's Government what definitions they intend by the use of the terms “small business”, “family business” and “family farm” in the Autumn Budget.

Small businesses are vital to high streets and communities, and essential to the success of the government’s growth mission. The UK has a wide variety of businesses, which interact with the tax system in different ways. As a result, the characteristics of a small business can vary depending on the nature of the specific policy. The eligibility or applicability of individual policies will be set out in the relevant documentation for those policies.

The Government announced a range of reforms at Autumn Budget 2024 supporting small businesses. These include:

• increasing the Employment Allowance to £10,500,
• freezing the small businesses multiplier (used for properties with a rateable value below £51,000) for 2025-26, and extending the retail, hospitality and leisure (RHL) business rates relief for 1-year at 40% (up to a cash cap of £110,000 per business),
• committing in the Corporate Tax Roadmap to maintain the Small Profits Rate and marginal relief at their current rates and thresholds, as well as maintaining the £1 million Annual Investment Allowance.
• Despite the difficult fiscal inheritance, we have been able to protect key business support programmes like Growth Hubs while increasing funding for Made Smarter Adoption, and allocating £250m to the British Business Bank’s small business programmes in 2025-26.

It is expected that up to around 2,000 estates will be affected by the changes to APR and BPR. Up to around 520 of these are expected to relate to claims for APR (including those that also claim for BPR), and this number falls to around 430 when claims that include AIM shares are excluded. Almost three-quarters of estates claiming agricultural property relief (or those claiming agricultural property relief and business property relief together) each year are expected to be unaffected by these reforms.