Government provides update on its Small Business Plan

The government has published a one-year update on its Small Business Plan, outlining progress on measures designed to help small and medium-sized businesses start, scale and grow.

The update covers several areas that could have a direct impact on SMEs, from tackling late payments to improving access to finance.

Tackling late payments

The Small Business Protections Bill was introduced to Parliament in May 2026 and includes measures aimed at strengthening protections for smaller businesses.

Proposals include stricter maximum payment terms, mandatory interest on late payments, greater board-level scrutiny of large companies' payment practices and stronger powers for the Small Business Commissioner.

According to the report, the Small Business Commissioner has helped small businesses recover £1.5 million in late payments, representing a significant increase on previous years.

Tax administration

The government has also highlighted reforms introduced through Tax Update 2026, which are intended to reduce the administrative burden on businesses.

Making Tax Digital (MTD) forms part of this approach, alongside plans for all VAT invoices to be issued electronically by April 2029.

While these changes are designed to simplify tax administration in the longer term, businesses will need to ensure their systems and processes are ready for the transition.

Improving access to finance

The British Business Bank's financial capacity was increased to £25.6 billion at Spending Review 2025, providing greater scope to support SME finance.

The Growth Guarantee Scheme is also being expanded, with SME lending supported through the scheme expected to reach £3.35 billion per year by 2028/29.

Meanwhile, the Start Up Loans Programme is being expanded to provide at least 85,000 loans over the next five years, with eligibility widened to include businesses that have been trading for up to five years.

Support for apprenticeships

The government is also simplifying the apprenticeship system to make it easier for small businesses in England to recruit apprentices.

Businesses can also access the new Youth Jobs Grant, which provides £3,000 for each eligible young person they employ.

What does this mean for small businesses?

From stronger late-payment protections to greater access to finance and employment support, the measures could provide useful opportunities for SMEs.

However, changes to tax administration and digital reporting also mean businesses will need to keep their systems and processes up to date.

If you need support with tax, business processes or accessing finance, speak to SJC, Chartered Accountants. Our team is here to help.