So what impact has the November 2017 budget had on our SME?
Budget has seen many changes including UK growth our GDP downgraded from 1.8% to a safer tentative 1.4%
Its not all disheartening news though, employees have several encouraging changes coming their way. They will be slightly better of with an extra personal allowance of £350 before they have to pay any tax.
The upper tax band limit will be increasing by over £1000, meaning that 40% tax will not be due until they have earned £34501. These are better for the employee and bear no additional cost to the employer.
The over 25’s will also see a rise in national living wage of £0.33 per hour from April that’s an increase of a inflation busting 4% and the UK living wage is going to rise up to £8.75, up by 3.6%. With inflation running at a current 3%, this budget is definitely going to help the lower income brackets.
If partners fall into the marriage allowance, where they are both basic tax payers, they will have the option of transferring their 10% to their partner with a potential of reducing their tax bill by a further £230.00
So, what does the budget mean for us and other SME’S?
There is no relief for corporation tax payers, it will remain at 19% but there is light at the end of the tunnel for us innovators, with a rise of 1% in R&D tax benefit from as early as January 2018.
We are already VAT registered and this area sees no changes to the current status quo of £85000. The VAT rate will remain as is for another 2 years, at least. But disappointing news for business rate payers, with revaluations brought forward to April 18 and now will be every 3 years instead of the current 5. Its around this time we all wish we were publicans, they get a £1000 discount if their property is valued over £100,000.
Company cars are as usual hit with the ones falling below the current standards will see an increase on car tax by one band and if a fuel supplement is given, then a double whammy will be had of car tax and car fuel benefit. This could see increases of 4%.
The government has stated that they are to introduce measures to ensure that venture capital schemes are targeted at investments with growth, particularly on high risk investments. This coupled with the new commitment to build around 300,000 new homes per year by 2020 – a record since the 1970’s. This will mean a total government investment of £44 bn, which includes an additional £15.3bn in financial support just for house builders over the next 5 years. Hopefully this should help get the economy moving…