New rules and regulations small business owners need to know in 2025
)
Posted: Fri 3rd Jan 2025
There are several new rules and regulations small business owners need to be aware of in 2025. See a summary below with resources to help you comply.
We are keeping this post updated so check it regularly. The rules apply across the UK unless otherwise stated.
January 2025 and spring/summer 2025: Suppression of personal information at Companies House
As part of the Economic Crime and Corporate Transparency Act which is gradually introducing changes to company law, from January 2025, individuals will be able to apply to suppress the following information from historical documents:
registered office address where it's their home address
From spring/summer 2025, individuals will be able to apply to suppress the following information from historical documents:
residential addresses in most instances when shown elsewhere on the register
day of birth for documents registered before 10 October 2015 (only the month and year of birth have been publicly displayed since 10 October 2015)
signatures
business occupation
Useful resources:
24 February 2025: Procurement Act
Delayed from the original start date of 28 October 2024, the Procurement Act will introduce several reforms to procurement rules including changes aimed at opening up public procurement to small businesses and social enterprises so that they can compete for and win more public contracts.
Key measures of interest to small business include:
A new duty on contracting authorities to review the particular barriers facing SMEs, and to consider what can be done to overcome them.
Large organisations will be required to publish a pipeline of contracts over £2m for 18 months to help suppliers have more time to prepare a pitch to deliver them. These will be published on a new central platform showing contracts by region.
A current key challenge for small businesses is the requirement to register on multiple platforms if they want to pitch for a contract. For example, if a construction business wishes to bid for public sector work, they may need to sign up to the NHS, a local authority, housing associations and universities separately. To combat this, a new supplier registration system will be introduced that suppliers sign up for once. The information provided will then be integrated with individual procurement systems.
Currently, contracting authorities can require businesses to have insurance to be in place before a contract has been awarded. This means that prospective suppliers have to incur unnecessary costs with no guarantee of winning the contract. The new rules prevent public sector organisations from having this requirement.
To combat late payment, 30 day payment terms will apply throughout public sector supply chains, regardless of whether they are written into the contract.
Useful resources:
Government Procurement Act advice webinars on 23 January at 10.30am and 24 January at 11am
31 March 2025: Simpler recycling regulations
Changes to the Environmental Protection Act, known as the 'simpler recycling' regulations, require all workplaces in England with over 10 employees (businesses and public sector organisations such as schools, libraries, colleges, universities, hospitals etc) to separate their dry recycling and food waste from their general waste.
The default requirement is four containers for:
Residual (non-recyclable) waste
Food waste (including garden waste if appropriate)
Paper and card
All other dry recyclable materials (plastic, metal and glass)
The rules will apply to micro businesses with under 10 employees from 31 March 2027.
Useful resources:
1 April 2025: National Living Wage and National Minimum Wage increases
Rates will increase as follows:
National Living Wage (21 and over): £12.21 (£0.77 and 6.7% rise)
18-20 year old rate: £10.00 (£1.40 and 16.3% rise)
16-17 year old rate: £7.55 (£1.15 and 18% rise)
Apprentice rate: £7.55 (£1.15 and 18% rise)
Accommodation offset: £10.60 (£0.67 and 6.7% rise)
Useful resource:
1 April 2025: Neonatal Care (Leave and Pay) Act
This Act provides parents with a right to up to 12 weeks' leave and pay when their baby requires neonatal care, alongside existing parental leave entitlements.
Useful resource:
6 April 2025: Increase to Employer's National Insurance
As announced in the government's Autumn Budget 2024, Employer's National Insurance contributions will increase by 1.2 percentage points to 15%.
The secondary threshold, the point at which employers start paying National Insurance on a worker's salary, will be cut from £9,100 a year to £5,000.
Useful resource:
6 April 2025: Employment Allowance increase
In a move designed to protect the smallest employers from the National Insurance rise, the Employment Allowance will increase from £5,000 to £10,500 which the government said means 865,000 small businesses won't pay National Insurance.
Useful resource:
6 April 2025: Increases to statutory sick pay and parental pay
Statutory maternity pay, maternity allowance, paternity pay, adoption pay, shared parental pay and parental bereavement pay will increase from £184.30 to £187.70 per week.
Statutory sick pay will increase from £116.75 to £118.75 per week.
The lower earnings limit will increase from £123 per week to £125 per week
Useful resource:
6 April 2025: Company size threshold increases
The introduction of the Companies (Accounts and Reports) (Amendment and Transitional Provision) Regulations 2024 will increase the monetary size thresholds for micro, small and medium-sized entities. The change is part of government efforts to cut red tape and reduce the reporting burden on companies.
The changes are as follows. To be classified for each threshold, businesses must meet two of the three criteria:
A guide from ICAEW outlines the impact on businesses:
"The government estimates that the new regulations will result in around 113,000 companies and LLPs moving from the small to micro-entity category, 14,000 moving from medium-sized to small and 6,000 moving from large to medium-sized. Companies able to move down a size category will be entitled to the accompanying reduction in reporting and audit requirements.
"For entities moving into the small entities regime, the impact will be significant. They will be exempt from the requirement to have a statutory audit of their annual accounts (subject to implications of group membership) and from producing a Strategic Report. They will also be able to take advantage of simpler accounting requirements. Those moving to the micro entities regime will additionally be exempt from producing a Directors' Report.
"Those moving from the large to the medium-sized category will be able to take advantage of exemptions from certain Strategic Report requirements, including a statement on how directors have had regard to stakeholder and other interests listed in section 172, CA 2006, otherwise known as the Section 172(1) statement."
Useful resource:
Autumn 2025: Identity verification for setting up, running, owning or controlling a company
As part of the Economic Crime and Corporate Transparency Act which is gradually introducing changes to company law, from autumn 2025, all new directors and people with significant control (PSCs) will need to complete identity verification with Companies House.
Identity verification will also apply to other registration types, such as any members of a limited liability partnership (LLP).
For existing companies, all directors (or equivalent) and PSCs will have a 12-month transition period to verify their identity with Companies House.
Useful resources:
Start or grow your business at StartUp Show 2025
Enterprise Nation's epic StartUp Show returns for the 11th year in London on Saturday 25 January 2025. Buy your tickets today to hear from amazing expert speakers on five focused stages and three interactive zones.
You might also like…
