How Many Businesses Are There in the UK according to 2026 Statistics
The United Kingdom is home to millions of businesses, from one person freelancers working at a kitchen table to household name companies employing tens of thousands of staff. If you have ever wondered exactly how many there are, how big most of them really are, and who employs the country, the official numbers give a clear answer. This guide pulls together the newest data from the government Business Population Estimates, the Office for National Statistics and Companies House, and explains what each figure actually tells you. The most recent official count covers the start of 2025, the newest available as this guide goes out, with the next yearly update due later in 2026.
How many businesses are there in the UK right now?
At the start of 2025 there were 5.7 million private sector businesses in the UK. That is the figure most people mean when they ask how many businesses there are, and it comes from the government Business Population Estimates, the official count of the whole business population. The number rose by 191,000 over the year, a gain of 3.5%, which was the strongest growth since before the pandemic and reversed several years of decline.
A second official count sits alongside it. The ONS business register recorded 2.73 million enterprises that were registered for VAT or PAYE in March 2025. The gap between the two numbers is not an error. It reflects the fact that most UK businesses are so small that they never have to register for either tax.
Registered against unregistered
Of the 5.7 million total, about 2.6 million (46%) were registered for VAT or PAYE, while roughly 3.0 million (54%) were registered for neither. The share that is registered has been creeping up, from 44% in 2020, but the headline stays the same: more than half of all UK businesses operate below the tax registration thresholds.
How the number has changed since 2020
The 5.7 million figure marks a clear rebound. The business population peaked at just under 6 million in 2020, then slipped for several years as the pandemic, rising costs and higher interest rates pushed many people out of self employment. The move up into 2025 is the first strong recovery in that run.
| Year | UK private sector businesses |
|---|---|
| 2020 | 5.98 million |
| 2021 | 5.59 million |
| 2022 | 5.51 million |
| 2023 | 5.56 million |
| 2024 | 5.50 million |
| 2025 | 5.70 million |
Even after the 2025 jump the total still sits below the 2020 high, so the population has recovered strongly without yet returning to its pre pandemic peak.
Employers against businesses with no staff
The size story is even starker when you look at employees. Only 1.4 million UK businesses actually employ anyone. The other 4.3 million, three in every four, have no employees at all. These are sole traders, freelancers, contractors and single director companies. Over the past year the number of employing businesses dipped slightly while non employing businesses grew by more than 200,000, so almost all of the growth in the population came from people working for themselves.
How big are UK businesses?
Small businesses do not just outnumber large ones, they account for almost the entire population. Together, small and medium businesses (known as SMEs, meaning fewer than 250 staff) make up 99.9% of all UK businesses. Large companies are a rounding error by count, even though they loom large in the economy.
| Business size | Number | Share of businesses | Share of jobs |
|---|---|---|---|
| Small (0 to 49 staff) | 5.64 million | 99.2% | 47% |
| Medium (50 to 249 staff) | 38,435 | 0.7% | about 13% |
| Large (250+ staff) | 8,335 | 0.1% | 40% |
The table shows the paradox at the heart of the UK economy. Businesses with fewer than 50 staff are 99% of all businesses but provide slightly under half of private sector jobs. Fewer than nine thousand large companies, one in a thousand businesses, provide two fifths of them.
How many people do UK businesses employ, and what do they turn over?
UK private sector businesses employed 28.1 million people at the start of 2025, up from 27.8 million a year earlier. SMEs accounted for 60% of that employment, roughly 16.7 million jobs, and for 51% of all private sector turnover, an estimated £2.8 trillion. Small businesses on their own employed 13.1 million people and turned over £1.9 trillion. Total private sector turnover came to about £5.5 trillion.
What type of business is most common?
Among the 2.73 million businesses registered for VAT or PAYE, the limited company is now the dominant form. Companies make up 76.7% of registered enterprises, well ahead of sole proprietors and partnerships.
The trend is one directional. In the year to March 2025 the number of registered companies grew by 1.8%, while registered sole proprietorships fell by 4.1%. More owners are choosing the protection and tax flexibility of incorporation, a shift that has been running for well over a decade.
There is a twist worth knowing. The breakdown above counts only the 2.73 million businesses on the official register. Across the full population of 5.7 million the picture flips. About 3.2 million of them, or 57%, are sole proprietorships run by self employed people, and most of those stay below the tax thresholds and never reach the register. So the limited company rules the registered world, while working for yourself is still the most common way to run a business across the country as a whole.
Which industries and regions have the most businesses?
By industry
Professional, scientific and technical services is the single largest industry group, holding 15.3% of all registered businesses. Construction is the next biggest by count, with around 385,000 firms, or 14.1% of the total. Wholesale and retail, though smaller by number of businesses, carries the largest share of SME employment and turnover of any sector, and it is also the biggest single contributor to VAT. The fastest growing group in the year to March 2025 was mining, quarrying and utilities, up 5.7%.
By region
Business activity is heavily concentrated in the south east corner of the country.
| Region | Registered enterprises (2025) | Share of UK |
|---|---|---|
| London | 538,000 | 19.7% |
| South East | 405,000 | 14.8% |
| Rest of the UK | 1,787,000 | 65.5% |
London and the South East between them hold more than a third of all registered enterprises, a concentration that has barely shifted in a decade of these statistics.
By nation
Zoom out to the four nations and the totals cover the whole business population, registered and unregistered alike, so they run higher than the registered figures above.
| Nation | Private sector businesses (2025) | Share of UK |
|---|---|---|
| England | 5.0 million | 87.9% |
| Scotland | 361,000 | 6.3% |
| Wales | 194,000 | 3.4% |
| Northern Ireland | 139,000 | 2.4% |
England is home to close to nine in ten UK businesses. Scotland has the largest business population of the three smaller nations, ahead of Wales and Northern Ireland.
Are more UK businesses starting or closing?
The flow in and out of the business population is large. During 2024 the UK saw 317,000 business births, a birth rate of 11.1%, and 280,000 business deaths. Deaths fell sharply from 310,000 the year before, so for the first time in a while new businesses clearly outnumbered closures.
Staying open is the hard part. Of the businesses born in 2019, fewer than half were still trading five years later. Survival varies by region, with the South West recording the best five year survival rate at 43.5%. The lesson for anyone starting out is that reaching the fifth birthday puts you ahead of most of the field.
How many UK businesses are registered for VAT?
Because most UK businesses are very small, only a minority ever cross the VAT line. Around 2.6 million businesses are registered for VAT or PAYE, and roughly 2.3 million are registered specifically for VAT. A business must register once its taxable turnover passes £90,000 over any rolling twelve months, or sooner if it expects to pass that figure within the next thirty days. Many smaller firms also register voluntarily so they can reclaim input VAT. We break down the VAT register in detail in our guide to UK VAT registration statistics.
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Use the free VAT calculatorFrequently asked questions
There were 5.7 million private sector businesses in the UK at the start of 2025, according to the government Business Population Estimates. That was an increase of 191,000, or 3.5%, on the year before.
Small and medium businesses make up 99.9% of the total. There are 5.64 million small businesses with up to 49 staff, 38,435 medium businesses, and only 8,335 large businesses with 250 or more employees.
UK private sector businesses employed 28.1 million people at the start of 2025. Small and medium businesses provided 60% of those jobs, roughly 16.7 million, and 51% of private sector turnover.
The limited company. Among registered enterprises, 76.7% are companies, followed by sole proprietors at 13.9% and partnerships at 5.9%. Registered companies are still rising while sole proprietorships are falling.
Opening. During 2024 there were 317,000 business births and 280,000 business deaths. Closures fell sharply from 310,000 the previous year, so new businesses outnumbered those that shut down.
About 2.6 million businesses are registered for VAT or PAYE, and roughly 2.3 million are registered for VAT specifically. Registration becomes compulsory once taxable turnover passes £90,000 in any rolling twelve month period.
At the start of 2025 England had about 5.0 million private sector businesses, Scotland had 361,000, Wales had 194,000 and Northern Ireland had 139,000. England is home to close to nine in ten UK businesses.
Growing again. The total fell for several years from a 2020 peak of just under 6 million, then rose by 191,000 to 5.7 million at the start of 2025. That was the strongest yearly growth since before the pandemic, though the count is still below its 2020 high.