Small Business Plan: What has changed one year on?

The government has published a one-year progress update on its Small Business Plan, setting out the measures introduced to help small and medium-sized businesses start, grow and access the support they need.

From tackling late payments to improving access to finance, the update covers several areas that could have a practical impact on SMEs.

Here's what business owners need to know.

Tougher action on late payments

Late payments remain a major challenge for small businesses, putting unnecessary pressure on cash flow and making it more difficult to plan for growth.

The Small Business Protections Bill, introduced to Parliament in May 2026, includes measures designed to strengthen protections for smaller firms.

Proposals include:

• Stricter maximum payment terms

• Mandatory interest on late payments

• Greater board-level scrutiny of payment practices within large companies

• Stronger powers for the Small Business Commissioner
  

The government also reports that the Small Business Commissioner has recovered £1.5 million in late payments for small businesses.

For SMEs struggling with customers who routinely pay late, stronger protections could provide some welcome support.

Changes to tax administration

The government says reforms introduced as part of Tax Update 2026 should help reduce some of the administrative burden faced by businesses.

It also points to Making Tax Digital (MTD) as part of its wider programme to simplify and modernise tax administration.

Further digitalisation is on the way. The government intends for VAT invoices to be issued electronically from April 2029, representing another significant change to the way many businesses manage their financial records.

Whether businesses ultimately experience these changes as a reduction in administration will depend on how smoothly they're implemented. Either way, SMEs will increasingly need appropriate digital accounting systems and processes in place.

More finance available to SMEs

Access to funding is another major focus of the Small Business Plan.

The financial capacity of the British Business Bank was increased to £25.6 billion at the 2025 Spending Review, with the aim of increasing the availability of finance for smaller businesses.

The Growth Guarantee Scheme is also being expanded. By 2028/29, the government expects the scheme to support £3.35 billion of SME lending each year.

There are changes for newer businesses too.

The Start Up Loans Programme is being expanded with the aim of delivering at least 85,000 loans over the next five years. Eligibility is also being broadened to include businesses that have been trading for up to five years.

For comparison, 9,551 loans were issued through the programme between August 2025 and May 2026, so the expansion represents a significant increase in ambition.

Apprenticeships and support for young workers

The government is also making changes intended to make apprenticeships simpler and more accessible for small businesses in England.

Businesses may also be able to benefit from the new Youth Jobs Grant, which provides £3,000 for each eligible young person hired.

For SMEs considering expanding their workforce, these measures could make recruiting and developing younger employees more financially attractive.

What does the Small Business Plan mean for your business?

Many of the measures announced under the Small Business Plan will take time to have their full impact, but there are opportunities that businesses should be aware of now.

Whether it's exploring available finance, preparing for further digital tax changes, taking advantage of employment support or improving the management of late-paying customers, keeping up to date with the available schemes could help your business make better-informed decisions.

At SJC, Chartered Accountants, we work with businesses at every stage of their journey, helping them understand their finances, manage their tax obligations and plan confidently for growth.

If you'd like to discuss how any of these changes could affect your business, speak to the SJC team. We're here to help.