Business

One in five SMEs cut staff as tax and cost pressures intensify, survey finds

Published

2 days ago

2 February 2026

Finding the right accountant is vital for managing your finances. Whether you are an individual or a small business owner, having professional support can save time and money.

Rising taxes and operating costs forced more than one in five UK small and medium-sized enterprises (SMEs) to make redundancies last year, underlining the growing strain on business owners as financial pressures mount.

A survey commissioned by Rathbones, one of the UK’s largest wealth and asset management groups, found that 21 per cent of SME leaders were compelled to cut staff in response to higher costs and tax burdens. The poll of more than 1,000 founders, owners and senior executives paints a picture of businesses being squeezed at both the corporate and personal level.

Overall rising costs were cited as the biggest threat to business by 70 per cent of respondents, while 58 per cent said rising taxation and regulatory burdens were among their most significant challenges. Business rates and employer national insurance contributions were singled out as particular pressure points.

The survey also highlights how closely intertwined business and personal finances are for many entrepreneurs. More than a quarter of SME leaders said over 25 per cent of their personal wealth is tied up in their business, meaning higher operating costs are increasingly spilling over into household finances.

This strain is being compounded by a rising personal tax burden. Frozen income tax thresholds continue to push business owners into higher tax bands, while cuts to capital gains and dividend allowances, alongside higher CGT and dividend tax rates, are eroding post-tax income. For many SME owners who extract profits via dividends, these changes are forcing a reassessment of long-established financial strategies.

Faye Church, senior financial planning director at Rathbones, said entrepreneurs were facing a “double whammy”.

“We consistently hear from business owner clients that they are determined to grow, hire and contribute to the wider economy,” she said. “But heightened tax pressures are increasingly stifling those ambitions. Entrepreneurs are being squeezed from both sides, higher taxes at the business level and rising personal tax bills, making it extremely difficult to plan, invest and build for the future.”

Church added that for most entrepreneurs the boundary between business and personal finances is thin, making it essential to consider both together in an increasingly complex and unpredictable tax environment.

Despite the pressure, some SMEs are adapting by reshaping their workforce. The research found that 9 per cent have increased their use of freelancers or contractors, while another 9 per cent have shifted towards more part-time or flexible roles to manage costs.

Confidence in government support remains low. Nearly two-thirds (62 per cent) of SME leaders said they believe the government does not understand the needs of entrepreneurs. More than half (51 per cent) said targeted measures such as business rates relief or changes to employer national insurance contributions would directly support growth and investment.

The impact is particularly severe in hospitality. More than 35 per cent of hospitality SMEs reported making redundancies last year, well above the SME average, and 69 per cent said increased taxation or regulation is now one of the biggest threats they face.

The findings come as pandemic-era business rates relief has been scaled back from 75 per cent to 40 per cent and is due to expire entirely in April. While ministers have announced further support for pubs, hospitality groups warn that restaurants, hotels and other venues risk being left out.

“Calls from the hospitality sector for targeted relief highlight the increasingly painful pressures facing these businesses,” Church said. “Without action, the mounting tax and cost burden risks stifling the very growth, innovation and local regeneration the UK economy urgently needs.”

Amy Ingham

Amy is a newly qualified journalist specialising in business journalism at Business Matters with responsibility for news content for what is now the UK’s largest print and online source of current business news.

Business

PAMT CORP: Pain Is Likely To Continue Near-Term (Downgrade)

Published

6 minutes ago

4 February 2026

NewsAdmin

PAMT CORP: Pain Is Likely To Continue Near-Term (Downgrade)

Business

From Pixar to Disney+: The $100-billion blueprint behind Bob Iger’s Disney

Published

14 minutes ago

4 February 2026

NewsAdmin

From Pixar to Disney+: The $100-billion blueprint behind Bob Iger’s Disney

When Bob Iger was promoted to chief executive officer of Walt Disney Co in 2005, he took over a company that was an undeniable force in entertainment and theme parks, but badly in need of rejuvenation.

In one of his first moves, Iger made Disney shows like Lost and Desperate Housewives available for sale on Apple ‘s iTunes platform, ushering in the unique idea of watching TV online. Three months later he bought Pixar from Apple co-founder Steve Jobs. That $7.4 billion deal was an eye-popper, paving the way for blockbusters like Cars and Inside Out that reinvigorated Disney’s animated film business.

Those early moves hinted at key parts of Iger’s strategy: acquire marquee entertainment franchises and find new ways to exploit them. As he prepares to hand the reins next month to his successor, theme-parks chief Josh D’Amaro, Iger leaves a legacy that includes snapping up the biggest brand names in Hollywood via more than $100 billion in mergers and acquisitions, expanding in China and building a streaming business that delivered $24.6 billion in revenue from people watching movies and TV shows online last year.

“That’s one huge insight of his,” said David Collis, an executive education fellow at Harvard Business School who has written about Iger. “If you own these incredible entertainment franchises, any device only increases demand for your content.”

More deals followed Pixar, including Marvel Entertainment and its stable of superheroes, Star Wars-parent Lucasfilm and the $71 billion acquisition of 21st Century Fox in 2019, which brought in franchises like The Simpsons and Avatar.

“The deal we did for Fox, in many ways, was ahead of its time,” Iger said this week on an earnings call when asked about Netflix’s pending acquisition of Warner Bros Discovery.
Those acquired characters and stories found their way into Disney’s theme parks. In 2013, when the company first began exploring a Star Wars land for the parks, Iger told his designers, “Be the most ambitious that you have ever been,” Bob Weis, the longtime head of Disney’s parks design business, recalled in his 2024 autobiography.Iger was also keen on international expansion, green-lighting the $5.4 billion Shanghai Disneyland. Before its 2016 opening, Iger flew to China on a nearly monthly basis to monitor its progress, according to Weis.

The same year the Fox acquisition closed, Iger launched Disney+, the company’s flagship streaming service, the company’s response to the growing dominance of Netflix in online viewing. Providing a new outlet for programming that ran on networks like the Disney Channel was a threat to the company’s lucrative cable-TV business, but in the end, Iger relented.

Disney+ was a hit from the start. Ten million customers signed up the first day, driven by programming such as the Star Wars-spinoff The Mandalorian. The company reported 132 million Disney+ subscribers at the end of its latest fiscal year.

TV Star
Iger has spent his whole career in the TV business, rising up the ranks at ABC and performing every task, from getting a bottle of Listerine for Frank Sinatra before a TV special to scheduling the 1988 Winter Olympics. He was considered a likely CEO of broadcaster Capital Cities/ABC until that company was acquired by Disney in 1996 and he had to start clawing his way up the corporate ladder again.

When a shareholder revolt finally prompted the retirement of Disney CEO Michael Eisner in 2005, Iger got his shot.

More than 20 years later, the worst grade on Iger’s corporate report card likely comes in succession planning. Multiple extensions of his contract over the years led senior Disney executives to exit. When he finally stepped down for the first time in 2020, his handpicked successor Bob Chapek proved to be disappointment.

As Iger prepares to pass the baton to D’Amaro on March 18, he leaves plenty of work still to be done. On the recent earnings call, Iger said he hoped his replacement would carry on with his focus on reinvention.