Are You Budget-Ready for November 26th?
Salon Owners, It’s Time to Get Ahead to make 2026 count.
As a salon owner, you already know how razor-sharp your margins can be, how every pound spent on Uplift Creams or electric chairs eats into profitability, and how unpredictable regulation can jump out from behind the chair. If you’re thinking your costs and compliance will just drift along as they are think again. Two key policy areas are flashing amber and will demand your attention:
🔍 What to watch
Value Added Tax (VAT) threshold under review
Currently, businesses in the UK must register for VAT when their taxable turnover exceeds £90,000
However, media reports highlight serious discussion about cutting the threshold to around £30,000 which would bring many more smaller firms into the VAT-net. vatcalc.com+2nfff.co.uk+2
DO YOU KNOW YOUR ROLLING VAT STATUS?
This means tracking when you hit the threshold and have to register?
What this means for salon owners: If your annual turnover is creeping toward that region, you could soon face having to add VAT to every service and retail product you sell and absorb the admin and cash-flow impact of VAT payment and reclaim processes. If you’re already around that size, you can’t simply hope the change won’t apply start modelling for it now.
The National Minimum Wage (NMW) & National Living Wage (NLW) hikes + ending age-bands
- NLW (21 +) is set at £12.21/hr. UK+1
- The rate for 18-20-year-olds is £10.00/hr, a 16.3 % rise. UK+1
Looking ahead: The Low Pay Commission (LPC) is already working on recommendations for April 2026: - NLW estimated to reach around £12.71/hr (≈ 4.1 % rise) for 21+ workers. org+2brc.org.uk+2
- Crucially, government has signalled a move to remove age-bands (i.e., the lower rate for 18-20-year-olds) over the next few years. Cubed Talent+1
What this means for salon owners: Whether you employ junior stylists, apprentices or assistants aged 18-20 — or expect to in the future — your staffing cost base is on a rising trajectory. If age-bands are removed, you may need to pay the adult rate for younger staff sooner than you expect. Without planning, your labour cost % could jump and squeeze profitability.
Why you must know your numbers now
- Cash-flow crunch: If you get caught by VAT registration unexpectedly, you’ll have to charge 20 % VAT on your services or products, send in the VAT return, and manage the delay between collecting VAT from customers and paying it to HMRC. Smaller salons can feel the strain.
- Price strategy implications: With cost increases looming (wages + possible VAT registration) you will likely need to raise prices or rationalise services, otherwise your margin gets squeezed. But you’re entering a customer-sensitive sector where price rises must be managed carefully.
- Profit leakage risk: If you continue to budget as if the old wage or VAT rules apply, you risk underestimating your cost base. That can lead to under-pricing or under-investing in staff, training, equipment or worse, eroding the margin you planned around.
- Competitive advantage: The salons that model these changes early, adjust service pricing, control cost bases, and communicate value clearly will survive — even thrive while competitors scramble.
- Compliance blindness is costly: Failing to register for VAT in time, or mis-calculating payroll after a wage increase, can lead to penalties, back payments and reputational risk. This is not “just another cost” it’s a business risk.
Don't worry we can help...
Why join **Salon Owners United (SOU) now
You’re not alone in this. Navigating regulatory stress, wage rises, VAT uncertainty, alongside staffing, customer retention and service innovation is a tall order. That’s where SOU steps in:
- We offer pricing calculators tailored for salons — punch in your numbers and see what price change you need to maintain margin.
- Get live budget updates the day policy changes land (VAT threshold, wage review, NI changes) so you’re not reacting late.
- Access 100+ salon-specific documents, policies and templates – from staff employment contracts, social-media use policies, wage review letters, service-menu wording, and compliance checklists.
- Join a community of fellow salon owners who face the same challenges: you’ll share insights, ask questions and build peer resilience.
- Get tailored sessions on how to raise your prices without losing clients, how to communicate value, how to forecast your costs and plan for change.
By joining SOU now, you’ll be ahead of the curve — not playing catch-up when the policy changes hit. You’ll have your budget modelled, your price book prepared, and your staffing cost under control ready for 2026.
The bottom line
There is time but not unlimited time. If you wait until April 2026 (or whenever new regulations arrive) to start your budget review, you’ll be playing defence instead of offence. That puts you at risk of margin erosion, customer price shock, compliance penalties and stress.
Start today. Know your turnover, know your staffing cost, model the worst-case scenario (VAT threshold drop + wage age-band removal) and build a plan.
Join SOU and other salon owners who just get it! we’ll help you do exactly that quickly, clearly, salon-specific, and with peer support.
Are you budget-ready? If not let’s get you ready for 2026.
REGISTER for your FREE Membership HERE
orDIVE RIGHT IN & JOIN as a PRO Member
👉 Visit www.sou.org.uk and join the community designed for salon owners who just get it and work TOGETHER to build STRONGER businesses - want to thrive, not just survive.
