The challenging economic landscape and evolving consumer behaviours have posed ongoing difficulties for small businesses throughout the year. However, this hasn’t dampened the emergence of new trends and optimistic outlooks for the future. From legislative shifts and tax modifications to evolving side hustle trends and entrepreneurial endeavours, here’s a glimpse into what 2024 might hold for small businesses:

1. Uncertainty Amid General Election and Rising Bills: The approaching general election, for no later than January 2025, designates 2024 as a pivotal campaigning year for all UK political parties. This political landscape introduces a degree of uncertainty for businesses. Insights from various SME reports indicate a significant increase in energy expenditures in 2023, with almost half of small businesses noting a spending surge ranging from 21 to 60 percent compared to 2022. As the Energy Bill Discount Scheme is set to conclude in March 2024, businesses may face further escalations in energy costs amidst the persisting energy crisis. Notably, 63 percent of businesses express plans to raise prices, showcasing the resilience and adaptability of the nation’s self-employed.
2. Tax Changes on the Horizon: For the self-employed, awareness of upcoming tax changes is crucial:

1. • Class 2 National Insurance Contributions will be eliminated from April 2024.
   • The Class 4 National Insurance contribution rate is set to decrease from nine to eight percent for the 2024-25 tax year.
   • Basis period reform is anticipated for the 2024-25 tax year, potentially altering the reporting of a business’s profit or loss.
   • Side hustle platforms (e.g., Etsy, Airbnb, Deliveroo) will be required to report freelancers’ earnings to HMRC starting January 1, 2024. It is imperative for individuals earning over £1,000 in a tax year to file accurate tax returns.

3. Side Hustle Businesses: The surge in side businesses, observed during the Covid-19 pandemic, persists as a prominent trend. Whether driven by passion or necessity, more individuals are opting for the path of entrepreneurship. Side hustles provide an avenue for those with entrepreneurial spirits to engage in freelance work while maintaining other employment commitments. Covering diverse passions and business areas, such as selling second-hand clothes or offering beauty treatments, side hustles have become a popular choice. Remarkably, 40 percent of established businesses originated as side hustles, hinting at a potential influx of new entrepreneurs.
4. Retail Trends: Consumers are increasingly inclined to patronize businesses demonstrating sustainable practices, making sustainability a strategic choice for businesses. The trend of shopping second-hand, whether through clothing apps like Vinted or establishing online shops for repairs and custom-made items, is gaining traction and is expected to continue in 2024.
5. Recruitment Outlook: For those involved in recruitment, it’s essential to note that the national living wage will rise to £11.44 starting April 1, 2024. This change underscores the ongoing importance of staying informed about wage adjustments for effective business planning.

If we can help you with your existing, business, side hustle or perhaps start up business in 2024 then please get in touch with Sean from Forest Bookkeeping on 01933 213223 or email sean@forestbookkeeping.co.uk.