Industry News

Budget 2018: Tax and business round-up

At a time of political and economic uncertainty, the announcement of several substantial measures in the Budget on 29 October 2018 came as a surprise for many businesses.

In fact, the Budget was met with an overall positive reception from industry groups, with the FSB calling it the Chancellor’s “first small-business-friendly Budget”.

A range of measures were announced to support high street businesses, including a reduction to business rates by a third for many independent shops, pubs and cafes with rateable values below £51,000.

This will apply for two years from April 2019, subject to state aid limits.

Pressure was also eased for smaller firms funding apprenticeships, as the co-investment rate required for training will be halved from 10% to 5%.

Meanwhile, businesses investing in plant and machinery were boosted by the annual investment allowance rising from £200,000 to £1 million for a two-year period from 1 January 2019.

Employers will need to pay attention to the national living wage when planning for next year, which is set to increase from £7.83 an hour to £8.21 an hour from 6 April 2019.

The VAT-registration threshold was frozen at £85,000 until 1 April 2022, with the Government planning to review it once the terms of the UK’s exit from the EU have been confirmed.

Suren Thiru, Head of Economics at the BCC, said:

“We are pleased that the Chancellor listened to our call to keep the VAT threshold unchanged over the near term, providing much-needed certainty to firms across the UK.

“A reduction in the VAT threshold could well have proved to be a tipping point for some of our most promising young firms.”

For some, however, the Budget wasn’t all good news, as the Chancellor confirmed that reforms to the off-payroll working rules – known as IR35 – will be extended to the private sector in April 2020.

The responsibility for operating these rules will move to the firm engaging the worker.

Chris Bryce, chief executive at the Association of Independent Professionals and the Self-Employed, called the IR35 rules “complex and crude”, and warned that genuinely self-employed people could be impacted.

To ease some of the burden, small organisations will be exempt, while medium and large organisations will be given support and guidance by HMRC.

Speak to us about how these measures affect you.

Entrepreneurs say they need more support

Four out of five entrepreneurs in the UK believe the government could do more to support their small business, research claims.

Aldermore surveyed 1,799 people, including 642 small business owners, and found 79% of respondents believed existing initiatives did not provide enough support to SMEs.

Apprenticeship levy funds go towards the training of apprentices, but only 36% of SMEs polled were aware of the funding and only 4% had accessed this form of government support.

A similar pattern emerged with capital allowances, with 27% of respondents aware of the scheme and only 5% utilising it to support their business. More…

Landlord costs could increase due to legislation

A new ban on tenant fees could push costs of more than £80 million onto landlords, government figures have shown.

The tenant fees bill, which was published on 2 May 2018, includes a ban on all fees charged to tenants apart from rent, deposits, and certain necessary costs.

A government impact assessment confirms that “the main costs fall on landlords and letting agents” as a result of the changes, with landlords expected to absorb £82.9 million in the first year. More…

Starting a business

Things to consider when starting a business.

Last year 608,110 businesses were incorporated according to data from Companies House. This is a year-on-year increase of 26,937 on the 581,173 businesses started in 2014.

However, figures from the Office for National Statistics show that 55% of new businesses fail within 5 years.

In order to avoid becoming part of this statistic, it is important to lay the groundwork before starting off on the path of business ownership and management. More…

IHT and the nil-rate band

A detailed guide to the residence nil-rate band for inheritance tax.

The rise in property prices throughout the UK means that even those with modest assets may find that their estate exceeds the £325,000 nil-rate band for inheritance tax (IHT).

The percentage of properties sold for more than £325,000 has doubled since the current nil-rate band was set in 2009, research by Saga Investment Services has found. More…

Autumn Statement 2016

Chancellor Philip Hammond is due to deliver his Autumn Statement on 23 November 2016.

Speaking at the Conservative party conference in October, Hammond said the government will prioritise spending on housing and business investment to boost the economy.

Here is a round-up of some of the potential measures that could be announced. More…

Higher earning parents use flexible working

Parents who earn more are more likely to work flexibly, according to the charity Working Families.

69% of parents who earn more than £70,000 a year work in a flexible way, compared to 47% of those earning between £10,000 and £40,000.

More than two thirds (68%) of all working parents said their work interferes with their ability to take part in activities with their children. More…

Businesses lack export ambition

Most businesses don’t currently export and don’t intend to start, according to research by the Institute of Chartered Accountants in England and Wales (ICAEW).

69% of businesses have never traded overseas and have no plans to do so in the future despite high-profile government campaigns. More…

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