Autumn Budget: Why 78% of small businesses are concerned

New Uswitch business savings research reveals that SME owners are concerned about how potential changes in the Autumn Budget could affect their business savings.

Although almost half of respondents reported an increase in their business savings this year, and over half expect savings to rise over the next 12 months, ongoing cost pressures and policy uncertainty are denting confidence.

Rising costs and tax concerns undermine savings progress

Three in five SME owners (61%) identified rising costs for energy, rent, materials and more as the biggest barrier to saving more.

Tax burdens come a close second, cited by 39%, followed by late payments from customers and clients (30%).

With speculation ahead of the Autumn Budget pointing to drastically different VAT scenarios for small businesses, as some experts have predicted a rise from £90,000 to £100,000, while others believe it could drop to £30,000, now’s the time for SMEs to review their finances and explore strategies to protect and grow their savings.

Day-to-day cash flow pressures, tax worries, and late payments make it difficult for many SMEs to build a financial buffer. Even profitable businesses can struggle to save when invoices are delayed, underscoring the need for proactive financial management.

A new savings benchmark emerges but gaps remain

The survey shows a marked shift in savings goals. 

Around a third of SMEs aim to keep four to six months’ worth of operating expenses in reserve. About one-sixth target one to three months, while a similar proportion aim for seven to nine months.

This move toward a four-to-six-month benchmark suggests businesses are better preparing themselves for financial uncertainty.

However, aspiration does not always equal reality. One in six (17%) respondents reported that their savings decreased this year, indicating that not all firms are managing to hit their targets.

How SMEs would respond to a shortfall

When faced with a sudden financial shortfall, many small business owners say they would rely on their own reserves before seeking external help.

Table 1: How SMEs would respond to a financial shortfall

Response	% of SME owners
Use business savings	33%
Use personal funds	23%
Reduce staff and costs	16%
Take out a loan or overdraft	12%
Delay supplier payments	7%
Terminate business activities	5%

Source: Uswitch.com, 1000 small business owners asked

A third (33%) of SME owners say they would turn to business savings first in the event of a financial shortfall, showing how vital cash reserves remain. The next most common responses would be to use personal funds (23%) or reduce staff and operational costs (16%), while 12% would look to other business financial options, such as loans or overdrafts.

Yet, despite these challenges, overall confidence remains high, with four in five SME owners saying they could manage short-term shocks without external finance.

Policy implications and what SMEs can do now

Andy Elder, Uswitch business savings expert, said:

“It’s encouraging that so many small firms have grown their savings in recent years. But with rising costs and ongoing economic uncertainty, that progress remains fragile. Businesses need clarity and practical support to turn short-term gains into lasting financial resilience.

“Small businesses are caught between the need to save for the future and the reality of rising costs and delayed payments. Timely policy measures on payment terms and targeted operating-cost support could provide the relief they urgently need.”

“Most SMEs plan to grow their savings over the coming year, which is a positive sign. But sustaining that progress will require stable policy, predictable costs, and faster payment cycles.”

“If you’re looking for ways to increase your cash reserves, think about:

• Tackling late payments: Enforce clearer payment standards to turn revenue into savings. 
• Easing cost pressures: Identify ways to reduce insurance, energy, or wage costs to free up margins. 
• Using savings tools: Take advantage of competitive business savings accounts and cash-management products to build buffers systematically. 
• Setting saving targets: Establish monthly goals and review supplier and customer payment terms to improve cash flow visibility.”