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Busy corporate and commercial department buoyed by Budget

The head of corporate and commercial at a North East law firm has spoken of the rush to secure business disposals prior to the autumn Budget – and has revealed this is now continuing into the winter in preparation for more tax hikes in April.

Dan Flounders, who is a partner at Jacksons, reflected on a “hectic” week in the run-up to Chancellor Rachel Reeves’ much anticipated autumn Budget, adding that while things had calmed down in the aftermath, there is still plenty of interest in the firm’s corporate and commercial services from business owners looking to sell and consolidators looking to acquire.

Dan said “political uncertainty” in general and the uncertainty around what changes were going to be imposed in the Budget had led to more business owners considering their futures, with many deciding to accelerate future plans by selling up or implementing succession planning ahead of anticipated tax hikes.

“There had been so many early rumours and leaks around the most recent Budget,” Dan said.

“That had created uncertainty around the tax perspective and if businesses were already thinking about selling, they decided that they might as well sell before the Budget to crystalise their tax position in line with existing tax rates.

“Business owners decided they were not leaving anything to chance in case the Government did something completely left field.”

Dan added that the increase in commercial sales was part of a longer-term trend, which began last October following the autumn Budget in 2024, when changes to Capital Gains Tax (CGT) were announced.

Another change to CGT is expected to come into force in April next year, after the Chancellor said the CGT Business Asset Disposal Relief Rate would rise from 14% to 18% from April 2026.

“For that reason, I think we are going to get another spate of transactions in quarter one of 2026,” Dan said.

“This is because sellers will be seeking to complete the sale of their business before the end of the 2025/2026 tax year and benefit from the existing tax rates which will be increased from April 6th 2026.”

Dan believes business owners have been “hardest hit” by successive budgets, which is leading people of a certain age looking to divest their interests and make sure they are crystalising their position now and accelerating any exit or succession plans.

The freeze on Inheritance Tax (IHT) announced in this week’s Budget also means the threshold at which people start paying the tax has been fixed at the current level of £325,000 until at least April 2031, instead of increasing with inflation. 

This will create a "fiscal drag," effectively drawing more estates into the tax net over time as asset values, particularly property prices, rise.

“This means that people with family-owned businesses are looking to accelerate their succession planning and move their businesses onto the next generation prior to April, as they look to negate both CGT and Inheritance Tax,” Dan said.

“This will be keeping our department busy over the next four to five months.

“However, even though there’s an element of doom and gloom about where we currently are from a financial perspective, the amount of deals being done across Teesside and the North East has created quite a buoyant picture in the local business economy.

“There is a lot of work around mergers and acquisitions and Jacksons, as an independent law firm serving the whole region, is benefiting from being one of the key players locally capable of executing these deals.”

 Dan said the current trend for increased disposals and family-owned businesses taking care of their succession planning earlier than expected is also something that will have a positive impact on those looking to make acquisitions - including private equity backed buyers.

“This creates quite a buoyant perspective for buyers, with lots of opportunities to make acquisitions across the region,” Dan said.

“It will certainly be interesting to see what happens as we move beyond the Christmas period and into the New Year.”

This was posted in Bdaily's Members' News section by Sarah Walker .