Business news 6 January 2026
UK businesses start 2026 facing a complex mix of rising costs, tax uncertainty and uneven demand. While global markets and large corporates continue to benefit from strong equity performance and AI-led investment, conditions on the ground for SMEs remain fragile. Retail, family businesses and credit-dependent sectors are under pressure, while households are increasingly reliant on borrowing to sustain spending.
James Salmon, Operations Director.
Business News
Economists warn further tax rises likely before next election
A Financial Times poll of 103 leading economists suggests the Government is likely to raise taxes before the next general election. Weak growth, frozen thresholds and limited fiscal headroom are increasing pressure on public finances, with many economists sceptical that spending restraint alone can stabilise debt.
Why it matters to SMEs who sell on credit:
Expectations of higher taxes can suppress business confidence and spending, increasing payment delays and credit risk across supply chains.
OBR to publish forecast without judging fiscal rules
The Office for Budget Responsibility will release an economic forecast on 3 March, but will not assess whether the Government is meeting its fiscal rules. Chancellor Rachel Reeves said the approach supports stability by limiting fiscal events to one major Budget each year, though the move reduces independent scrutiny.
Why it matters to SMEs who sell on credit:
Less fiscal transparency increases uncertainty around future tax policy, making cashflow planning and credit decisions harder.
HMRC issues 1.3m underpayment notices as fiscal drag bites
HMRC has sent 1.32 million “simple assessment” letters to individuals owing income tax not collected via PAYE, nearly double the number seen in 2021/22. The average underpayment has risen to £920 as frozen tax thresholds pull more income into tax.
Why it matters to SMEs who sell on credit:
Unexpected personal tax bills can squeeze household finances, increasing the risk of missed or delayed payments to small businesses.
Workers turn down promotions to avoid the £100,000 tax trap
Research shows 43% of managers say staff have reduced hours or declined promotions to avoid crossing the £100,000 income threshold, where childcare benefits are lost and personal allowances withdrawn. Economists warn the system is harming productivity.
Why it matters to SMEs who sell on credit:
When senior staff limit earnings or reduce hours, operational efficiency and cashflow control can suffer, increasing late-payment risk.
BUSINESS & INVESTMENT
Family businesses fear bleak economic outlook for 2026
Research for the Jobs Foundation found 78% of family businesses are pessimistic about the economy in 2026. Many believe the current tax and regulatory environment is worse than in previous decades, with concerns that government lacks ambition for growth.
Why it matters to SMEs who sell on credit:
Low confidence often leads to delayed investment and tighter cash management, increasing payment risk for suppliers.
Tax grab fears grow over future of family firms
Family Business United has warned that changes to business property relief and inheritance tax thresholds could force family firms to sell or break up. The group is backing a judicial review and calling for consultation with business leaders.
Why it matters to SMEs who sell on credit:
Succession uncertainty weakens financial resilience, raising the risk of delayed payments or insolvency.
Wealthy investors scale back UK presence over tax reforms
Several high-profile family offices, including those linked to John Fredriksen and Nassef Sawiris, are reducing their UK footprint in response to tax reforms, with new operations established overseas.
Why it matters to SMEs who sell on credit:
Reduced investment flows can slow deal activity and spending, impacting cashflow across SME supply chains.
CONSUMERS, RETAIL & HOUSING
High street retailers face administration as trading conditions worsen
Claire’s and The Original Factory Shop are on the brink of administration, with around 2,550 jobs at risk. Their owner cited falling footfall, weak consumer confidence and rising costs as making profitability unviable.
Why it matters to SMEs who sell on credit:
Retail administrations often leave suppliers exposed to unpaid invoices, highlighting the importance of credit limits and monitoring.
Food inflation rises for first time since summer
UK food inflation rose to 3.3% in December, pushing overall shop price inflation to 0.7%. Shoppers increasingly relied on promotions, which accounted for a third of festive sales.
Why it matters to SMEs who sell on credit:
Heavier discounting pressures retailer margins and cashflow, increasing late-payment risk for suppliers.
Shop price inflation set to remain sticky into 2026
The British Retail Consortium warned shop price inflation is likely to remain elevated into 2026 as retailers face ongoing labour, logistics and compliance costs.
Why it matters to SMEs who sell on credit:
Persistent price pressure can strain both retailers and consumers, increasing credit exposure for suppliers.
Credit card spending surges as households lean on borrowing
UK credit card spending rose to nearly £78bn in November, with annual borrowing growth accelerating to 12.1%, the fastest since January 2024.
Why it matters to SMEs who sell on credit:
Rising household debt can support spending short-term but raises the risk of defaults filtering through to small businesses.
Mortgage approvals edge lower as rates tick up
Mortgage approvals dipped slightly in November as average rates edged higher. Economists say the biggest gains in affordability are now behind us.
Why it matters to SMEs who sell on credit:
A softer housing market can weigh on consumer confidence and spending, slowing payments to SMEs.
Property flipping hits decade low
Only 2.3% of homes sold were flipped within 12 months, the lowest level since 2013. Rising stamp duty and construction costs continue to erode profits.
Why it matters to SMEs who sell on credit:
Lower activity reduces demand for trades and materials, increasing cashflow pressure for suppliers.
UK new-car sales pass 2 million as EV discounting intensifies
New-car registrations rose 3.5% in 2025, driven by heavy discounting on electric vehicles. Chinese manufacturers are adding competitive pressure to the market.
Why it matters to SMEs who sell on credit:
Margin pressure in the automotive sector can strain dealer and supplier cashflow, increasing late-payment risk.
MARKETS & GLOBAL BUSINESS
Market summary: shares hit records as commodities surge
UK shares
- The FTSE 100 closed above 10,000 for the first time, ending Monday at 10,004.57 (up 0.54%).
- On Tuesday morning it extended gains, opening around 10,062.80 (up about 0.6%), helped by Next reporting better-than-expected Christmas trading.
- The rally was led by mining and defence stocks, reflecting both surging metals prices and a more risk-aware backdrop.
Europe
- The Stoxx Europe 600 hit a record high on Monday, rising 0.9% and breaking above 600 for the first time.
- The Euro Stoxx 50 was slightly softer on Tuesday at 5,911.44 (down 0.21% from Monday’s 5,923.69).
- European markets generally stayed supported by the mining sector, as copper pushed to record highs.
United States
- The S&P 500 closed Monday at 6,902.05 after a strong session where it rose 0.8%, with flows into technology and energy despite geopolitical nerves.
- The Nasdaq closed at 23,395.82, holding near highs.
- Semiconductors and memory-related stocks continued to outperform on optimism that AI investment remains strong.
Key drivers moving markets
- Geopolitics (Venezuela): the reported escalation involving Venezuela was a major catalyst for a shift into defence and select energy names, and it also boosted demand for perceived “safe havens”.
- Technology and AI: continued enthusiasm for AI deployment supported US tech leadership, particularly chip and equipment names.
- Mining/metals: a powerful move higher in industrial and precious metals lifted miners across the UK and Europe.
Commodities
- Gold jumped on safe-haven demand, briefly rising above $4,430/oz.
- Silver rose sharply too, up close to 5% at one point.
- Copper was the standout: it hit $13,000/tonne for the first time, then extended to around $13,387.50/tonne. Drivers included supply worries (including disruption risk at a Chilean mine) and heavy shipping flows toward the US amid tariff speculation.
- Oil was volatile. Brent was around $60.80/bbl on Monday, with markets balancing near-term disruption risk against the reality that Venezuela produces less than 1% of global supply despite having very large reserves.
FX
- Sterling strengthened versus both major counterparts.
- GBP/USD traded around 1.355, with Monday’s close near 1.3542 and a further modest lift on Tuesday.
- Against the euro, sterling strengthened to roughly 1.155–1.156.
Overall mood
Risk appetite remains constructive (equities strong, tech and miners leading), but markets are clearly more sensitive to geopolitical headlines. Traders are now looking ahead to US economic data and the next set of signals from the Federal Reserve later this month.
CFOs grow more bullish on productivity as AI investment accelerates
Nearly 80% of CFOs expect improved productivity over the next five years, driven by AI and technology investment, though geopolitical risk remains a concern.
Why it matters to SMEs who sell on credit:
As large firms improve efficiency, expectations around invoicing accuracy and payment terms may tighten.
AI boom lifts Foxconn revenues as Nvidia unveils new platform
Foxconn reported a 22% jump in quarterly revenues driven by AI hardware demand, while Nvidia launched its new Vera Rubin platform to support data centres.
Why it matters to SMEs who sell on credit:
Rapid AI investment cycles can create opportunities but also increase counterparty risk if spending slows suddenly.
BlueCrest posts huge gains as Michael Platt’s fortune surges
BlueCrest Capital Management reported a 73% return last year, continuing a long run of outsized gains that have boosted Michael Platt’s wealth.
Why it matters to SMEs who sell on credit:
Soaring financial-market wealth contrasts sharply with tight trading conditions for SMEs, highlighting the growing gap between markets and the real economy.
Why CPA membership matters right now
Today’s news paints a clear picture for UK businesses trading on credit. Tax pressure is rising, household and business borrowing is increasing, retail and property sectors remain under strain, and insolvency activity continues to run at worrying levels. At the same time, uncertainty around future tax policy and weaker consumer resilience are making payment behaviour harder to predict.
For SMEs, this environment increases the risk of late payment, bad debt and sudden counterparty failure. CPA members are better placed to protect cashflow through access to CreditCare reports, ongoing monitoring, and expert support when accounts go overdue. In uncertain trading conditions, knowing who you are trading with — and spotting risk early — can make the difference between staying in control and being caught out.
Just call Peter Uwins, CPA’s National Sales Manager, on️ 020 8846 0000 (business hours) or email nsm@cpa.co.uk today.
When you see your money come in, you will be so glad you used CPA.
The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections.
Insolvency Notices
Appointments of Administrators
- CONTOUR BRICKWORK SERVICES LIMITED
- HOME LEISURE DIRECT LTD
- INDUSTRIAL WATER JETTING SYSTEMS LIMITED
- JHOOTS CHEMIST LIMITED
- JHOOTS PHARMACY LIMITED
- LIGHTFOOT SOLUTIONS GROUP LIMITED
- LP SD EIGHT LIMITED
- LP SD EIGHTEEN LIMITED
- LP SD ELEVEN LIMITED
- LP SD FIFTEEN LIMITED
- LP SD FOURTEEN LIMITED
- LP SD NINE LIMITED
- LP SD NINETEEN LIMITED
- LP SD SEVENTEEN LIMITED
- LP SD SIXTEEN LIMITED
- LP SD THIRTEEN LIMITED
- LP SD TWELVE LIMITED
- LP SD TWENTY LIMITED
- THE ASSOCIATION OF MEDICAL SECRETARIES, PRACTICE MANAGERS, ADMINISTRATORS AND RECEPTIONISTS LIMITED
- ZHONG LUN LAW FIRM LIMITED
Appointments of Liquidators
- 8BALL GAMES LIMITED
- AERBIO UK LTD
- AKOYA BIDCO 5 LIMITED
- ALEX FISHER (FOODSERVICE ADVISOR) LTD
- CHELTENHAM THEATRE INVESTMENTS LIMITED
- GUS ROBINSON DEVELOPMENTS LIMITED
- LOMOND ENERGY LTD
- TESTING 789 LTD
- ZELEZNY PROPERTIES LTD
Petitions to Wind Up (Companies)
- CARDIFF TRAVELZ LTD
- COMPANIES 4 SALE LTD
- DH1 BUILDING SUPPLIES LTD
- JP LAW SOLICITORS LTD
- LANDGOLD CAPITAL LTD
- MASTER ELECTRICAL INSTALLATIONS LTD
- MY SURROGACY JOURNEY LTD
- PLAYGROUND BARS LIMITED
- ROSCOE PROJECTS LTD
- ST BLAZEY RECYCLE REUSE & RESALE CIC