2025 Budget teardown: Marketing & Tech founders

The 2025 Budget arrived with the usual long list of tax changes, technical amendments and policy announcements.

But for founders running marketing agencies, media businesses, digital platforms, AI ventures and technology companies, only a relatively small number really matter.

Some are genuinely helpful. Others make raising capital, rewarding employees or extracting value more expensive. And several tell us something interesting about where the Government wants investment to flow.

So rather than repeat the Budget, here is our founder-focused view of what matters heading into 2026.

And yes, if you are genuinely building with AI rather than simply adding it to the pitch deck, there is further evidence here that you are operating in an area policymakers want to encourage.

BUSINESS IMPACTS

The positives

EMI gets much more useful for scale-ups

This is one of the standout changes for growing technology and digital businesses.

From April 2026, the Enterprise Management Incentive scheme expands significantly. The employee limit increases from 250 to 500, the gross-assets threshold rises from £30m to £120m and the total value of company options that can be granted doubles from £3m to £6m. The maximum option period also increases from 10 to 15 years.

That matters for businesses competing for expensive specialist talent in areas such as engineering, data, AI, performance marketing and creative technology.

EMI has always been a useful way for smaller companies to compete with larger employers on remuneration. Extending it further into the scale-up journey makes equity a more practical retention and recruitment tool for a much broader group of businesses.

EIS and VCT expand into scale-up territory

The Government is also significantly increasing the limits applying to EIS and VCT investment from April 2026.

The annual company investment limit rises from £5m to £10m—and to £20m for Knowledge Intensive Companies. The lifetime limit increases from £12m to £24m, or £40m for KICs. The gross-assets tests increase to £30m immediately before investment and £35m immediately afterwards.

This is potentially important for SaaS, AI, AdTech, MarTech and other technology-enabled businesses that need larger amounts of growth capital.

The direction of travel is clear: EIS and VCT are becoming more relevant beyond the traditional startup phase and further into scale-up.

There is a catch, however. VCT investors will see their upfront Income Tax relief fall from 30% to 20%, which could temper investor appetite even as the range of eligible companies expands.

A small boost for UK IPOs

A new UK Listing Relief removes the normal 0.5% Stamp Duty Reserve Tax on transfers of securities for three years after a company lists on a UK regulated market.

For most founders, this is a long way down the road. But for later-stage technology companies considering London as an exit route, reducing transaction friction and improving secondary-market economics is directionally positive.

More institutional capital is being encouraged towards venture

The British Business Bank is also developing VentureLink, intended to make it easier for pension funds and other institutional investors to navigate the UK venture market.

It is part of a broader effort to increase the flow of institutional capital into UK growth businesses.

That won’t transform fundraising conditions overnight. But alongside the expansion of EIS, VCT and EMI, it reinforces a clear policy direction: the Government wants more capital to remain available as successful UK companies move from startup to scale-up.

The less positive changes

VCT tax relief falls from 30% to 20%

The trade-off for expanding the venture schemes is a reduction in upfront VCT Income Tax relief.

From April 2026, the rate falls from 30% to 20%.

The Government’s intention is partly to rebalance VCT incentives relative to EIS and encourage VCT managers towards higher-growth investments. For founders, however, the question will be whether the lower relief changes investor demand for new VCT fundraising.

EOT exits become significantly less attractive

For agency and creative-business founders, this is one of the more important changes.

Capital Gains Tax relief on qualifying disposals to Employee Ownership Trusts has been reduced from 100% to 50%.

EOTs have become increasingly popular across marketing, creative, consulting and professional-services businesses as an alternative succession route. They remain viable, but the economics for a selling shareholder are now materially less attractive.

For founders considering an EOT alongside a trade sale, private equity transaction or management buyout, the comparison needs to be revisited rather than relying on the historic tax advantage.

Premium premises may become more expensive

Business rates are changing from April 2026.

Eligible retail, hospitality and leisure properties receive permanently lower multipliers, while properties with rateable values of £500,000 or more move onto a higher-value multiplier.

That distinction matters. The lower rate is not a general relief for agencies, studios or technology offices. But experience-led businesses with qualifying retail or hospitality premises may benefit, while companies occupying particularly valuable offices or other commercial properties could face higher costs.

For London businesses in premium locations, it is worth checking the actual rateable value and classification of the property rather than assuming the headline changes are favourable.

INDIVIDUAL IMPACTS

Dividends get more expensive

For owner-managed businesses, this is one of the clearest personal tax changes.

From April 2026, the ordinary dividend rate increases from 8.75% to 10.75%, while the upper rate increases from 33.75% to 35.75%. The additional rate remains unchanged at 39.35%.

For founders using the familiar salary-plus-dividend remuneration model, that directly increases the cost of extracting profits.

It also makes remuneration planning increasingly worth considering as a whole—salary, dividends, pension contributions and eventual capital extraction—rather than looking at each independently.

Property and savings income face higher rates

From April 2027, separate rates for property income are introduced at 22%, 42% and 47%.

Savings income rates also increase by two percentage points across the bands.

For founders with significant cash investments, property portfolios or other income-producing assets outside their businesses, the direction is therefore fairly clear: income generated from assets is being taxed more heavily.

Pension salary sacrifice gets capped

From April 2029, only the first £2,000 of pension contributions made through salary sacrifice will benefit from employee and employer National Insurance relief.

Contributions above that level can still be made, but the NIC advantage disappears.

For higher earners and founder-directors who use pension salary sacrifice as part of their remuneration planning, this materially reduces one of its attractions.

High-value homes face a new surcharge

From April 2028, owners of residential properties in England worth £2m or more will face a new High Value Council Tax Surcharge.

For founders and executives with higher-value residential property—particularly in London and the South East—this becomes another personal cost to factor into longer-term planning.

Fiscal drag: the quieter tax increase

One of the more significant issues for founders is not a new headline tax rate at all.

Income Tax thresholds remain frozen, meaning that as earnings increase, a greater proportion of income naturally moves into higher tax bands.

This matters particularly for founders moving from a relatively low startup salary towards more conventional scale-up executive remuneration. Even where pay simply rises with inflation, frozen thresholds progressively increase the effective tax burden.

Combine that with higher dividend rates and the eventual restriction on pension salary sacrifice, and the overall environment for extracting income from a successful founder-led company becomes less generous.

It is not as eye-catching as a new headline tax, but over several years the cumulative effect can be substantial.

Other changes worth having on the radar

There are several further measures that may matter depending on the business.

Mandatory e-invoicing is coming for VAT-registered B2B and B2G transactions from 2029, which will eventually affect finance systems and billing workflows.

Changes to customs treatment for lower-value imports will matter more to e-commerce and physical-product businesses than most technology companies.

The Government is also continuing the digital modernisation of taxes on securities, while changes around R&D administration and tax compliance point towards greater scrutiny and more digital interaction with HMRC.

For most founders these are not immediate strategic issues, but they reinforce a broader trend: tax administration is becoming more digital, more automated and, in some areas, less forgiving of weak compliance.