When do you start earning for yourself? For some, it is later than ever

There is a date each year when the average person’s earnings finally stop going to the Government and start going to them.

In 2025, that date was 11 June, nearly six months into the year.

This concept, known as Tax Freedom Day, gives a rough indication of the total tax burden faced by UK taxpayers.

Pre-pandemic, it landed in late May. Back in 2009, it was a full three weeks earlier. If current projections prove correct, we could see it arrive in late June by the end of the decade.

While this is worrying for many, business owners are often among the worst affected, not only because of tax increases, but due to the quiet accumulation of rules and limits that make it harder to manage income effectively.

Why business owners are feeling it more

It is not just about rate changes.

The entire shape of the tax system is changing in a way that leaves business owners more exposed:

• Frozen Income Tax thresholds mean more of your income falls into higher bands, despite inflation.
• Corporation Tax hikes mean larger companies are paying significantly more than they were a few years ago.
• Dividend allowances have been repeatedly cut, now on course to drop to just £500, a fraction of the £5,000 limit available not long ago.
• Regulatory demands are pulling more time and money into compliance.

These changes are less visible than a headline rate rise, but together they can erode profitability in a meaningful way.

Could it get worse?

There is no certainty yet, but the Autumn Budget could bring more change.

With the new Government under pressure to fund spending plans, tax reform is unlikely to be off the table.

Business owners, often viewed as resilient and relatively well-off, may again be in the spotlight.

That makes this a useful moment to take stock.

If you would like to learn if your current setup is still working for you, or just want to understand the most tax-efficient options available contact us today.