The Autumn Budget gave owner-managers a headline to cheer and a cut to absorb. A new founders’ relief offers a 10% capital gains tax rate on up to £10m of lifetime gains from April 2027, but business asset disposal relief (BADR) has been halved to £500,000 from the same date. As Jerroms Miller’s Nick Wright argued in AccountingWEB, many owner-managers will end up funding incentives they can’t use. That gap is where independent accounting firms can show what a local adviser is worth.

The bigger picture: relief has moved from the many to the few

Look at the numbers together. BADR’s lifetime limit falls from £1m to £500,000 for disposals on or after 6 April 2027, taxed at 18%. Nick Wright calculates its maximum value is now £30,000. The ATT’s David Wright points out that from 2011 to 2020, entrepreneurs’ relief covered up to £10m of gains at 10%. The new limit is 5% of that, at nearly double the rate.

Founders’ relief brings back the old numbers, but with strict conditions. As proposed in the consultation that closes on 30 November 2026, the individual must have held at least 25% of the shares when the trade began and held them for five years. The company needs turnover of at least £10m and 15 qualifying full-time employees. It must also pass two of three growth tests: 25% compound annual turnover growth over three periods, 25% headcount growth, or £1.5m of R&D spend in the three years before sale. Nick Wright notes that the Treasury’s costings show founders’ relief costing about £300m a year, almost exactly what the BADR cut raises.

Other changes in the Budget squeeze owner-managers further. The main writing down allowance falls to 12%, the National Living Wage rises 3.9% to £13.21 an hour from April 2027, and the rules on profit extraction through buybacks and capital reductions are being reformed from April 2028. Dividend tax rates are unchanged, which is some relief.

The typical client of a regional accounting practice, a profitable trading company with a few million in turnover, built over twenty years, has just seen its exit become more expensive. Founders’ relief won’t help it.

What independent accountants need to know

Timing is now a planning question. The BADR cut applies to disposals from 6 April 2027. Clients already in sale talks, or thinking about retiring in the next few years, need to know whether completing before April changes their tax bill, and whether that’s worth doing. That’s a conversation for the next few weeks, not next autumn.

Serial entrepreneurs are most exposed. Clients who used part of their lifetime allowance on an earlier sale may find little or none of the new limit left. It’s not yet clear how earlier claims will interact with founders’ relief, so these clients need careful records and a clear explanation.

Alternative exit routes are back on the table. Nick Wright suggests employee ownership trusts may become more popular, with no limit on the relief. Management buyouts, phased exits and family succession plans all deserve a fresh look now the BADR maths has changed.

EMI2 opens a retention conversation. From April 2027 the company share option plan becomes EMI2, the individual limit doubles to £120,000 and the exercise period extends to 15 years. For clients that have outgrown EMI or never qualified, that’s a new way to reward key staff. One catch, as Nick Wright notes, is that options can’t currently be granted over shares in a company controlled by another unlisted company, and it’s not clear that will change.

What forward-thinking practices are already doing

The firms getting ahead of this aren’t waiting for clients to ask.

They’re running an exit-exposure review across the client base. They’re flagging every owner-managed company where the shareholders are over 55, have mentioned retirement, or have received approaches. Each one gets a short note explaining what the BADR change means for them and offering a planning meeting.

They’re turning exit planning into a defined service. Fixed scope, fixed fee: a valuation range, a tax comparison of exit routes, a timeline and a list of actions. Owner-managers will pay for clarity when tens of thousands of pounds are involved, but they want to know the cost upfront.

They’re building referral partnerships. Corporate finance boutiques, solicitors and wealth managers all want introductions to owner-managers who are planning an exit. An independent firm that coordinates the process becomes the trusted adviser at the most valuable moment in a client’s business life.

They’re responding to the consultation, or at least following it. The founders’ relief conditions may change before legislation. Firms that can tell a fast-growing client “you may qualify, and here’s what you need to prove” will win business from scale-ups that are currently served by larger firms.

How this connects to growth

This is where the competitive argument gets sharp. Low-cost online accountancy services compete well on compliance. They file accounts and returns at a price many high street accountants can’t match. They don’t sit across the table from a 60-year-old founder and work out whether to sell before April, set up an EOT or pass the business to the next generation. Exit and succession advice is relationship-heavy and judgement-heavy, which suits independent firms.

The problem is visibility. Owner-managers thinking about selling rarely ask their current accountant first, especially if that accountant has only ever talked to them about filing deadlines. They search for terms like “BADR changes 2027”, “selling my business tax” or “exit planning accountant” plus their town, or they ask an AI assistant. If your website only lists “accounts, tax, payroll”, you won’t appear.

That makes accounting marketing part of the advisory strategy. A dedicated exit planning page, a dated article explaining the BADR cut and founders’ relief, and case studies of past sales and successions all signal advisory expertise to prospects and to search engines. Pair that with local SEO that highlights business sale and succession services, and the firm starts attracting higher-value work instead of more compliance clients. That is the kind of accounting firm growth that improves margin rather than workload.

It also changes how existing clients see you. An owner-manager who gets a proactive note about BADR within a fortnight of the Budget sees their accountant as someone watching out for them. That is the strongest defence against a cheaper competitor.

Advice is the advantage

This Budget’s message to owner-managers is that relief is being reserved for the fastest-growing few, and everyone else will pay more to exit. That’s bad news for them, but it plays to the strengths of independent practices. The firms that move first, explain clearly and package the advice well will be remembered as the ones that helped when it mattered. Firms that stay silent will become interchangeable with the online services undercutting them on price.

Competing on advice rather than price takes visible expertise, consistent marketing and a network of peers who’ve done it before. That’s what the CharterGroup Alliance gives independent accounting practices: the marketing firepower, digital visibility and shared know-how to win advisory work against larger firms and cheaper rivals. If you want your firm to be the first call when a client starts thinking about an exit, explore CharterGroup membership.

Published by the CharterGroup team