The tax, inflation and cyber-attack woes troubling Scottish family-owned businesses.
Family businesses in Scotland are increasingly concerned about tax increases, inflationary pressures and the threat of a cyber attack, a new survey has revealed.
The new research from accountancy and business advisory firm Armstrong Watson found those three issues were the biggest concerns of Scotland’s family, privately owned and owner-managed businesses.
Against a backdrop of political change and ongoing policy reform, the firm’s latest survey found Scottish businesses remain ambitious and focused on growth, but the majority are also increasingly concerned about the potential impact of tax increases (84%), inflationary pressures on costs (81%) and changes in government policy (79%) over the coming 12 months.
The survey also highlighted how cyber security is now a mainstream business issue rather than a specialist IT concern, with almost a third of respondents reporting experiencing a cyber incident. Of those, 20% said the incident had happened in the last three years, while 67% of respondents said they are concerned about the threat of a cyber attack.
The 2026 Family, Privately Owned and Owner-Managed Business Survey is Armstrong Watson’s sixth to date and one of the largest of its kind, with 840 businesses from across all sectors and regions sharing their views.
People-related challenges continue to feature prominently, though recruitment struggles in Scotland have eased since 2025. This year, 63% of businesses reported difficulty recruiting new talent, compared to 85% across the region in our previous survey. The main issue, cited by 77%, is a lack of skilled or suitable candidates.
As 48% highlight having the right people in the business as one of the biggest barriers to growth over the next three years, many are taking proactive steps. More than half (53%) have implemented measures to improve staff retention, while the use of salary sacrifice schemes has increased, with 46% now offering them, compared with 31% in 2025.
The findings also suggest family-owned, privately owned and owner-managed businesses have not lost their appetite for growth, as 74% of respondents have a business plan with actionable goals.
Technology is an area where business behaviour is evolving rapidly. Across the region, 44% of respondents are now using AI within their business - a significant increase in the last 12 months, up from 23%. A further 23% are actively considering AI adoption.
Paul Dickson, Chief Executive and Managing Partner at Armstrong Watson, said: "It's perhaps unsurprising that concerns around taxation and inflationary pressures have risen to the top of the list of anticipated economic impacts for businesses over the coming 12 months.
“Businesses have experienced a period of significant political change, alongside continued reforms affecting employment costs and National Insurance contributions, succession and business taxation.
“Many owners are still assessing what these changes will mean for their businesses, investment plans and future growth. These are not short-term issues, which means businesses are having to think more strategically about how they operate and grow.
“What's particularly encouraging is that many businesses are not standing still. We have seen a significant increase in AI adoption - uptake across Scotland has almost doubled -, greater investment in staff retention initiatives, and a growing focus on succession planning.
“Despite the challenges, there remains a strong appetite to innovate, improve and prepare for the future. The key will be balancing ambition with resilience and ensuring businesses have the right advice and support around them as they navigate change.”