We take a look at the Budget and key tax changes announced in the Chancellor’s speech, providing a brief overview and a downloadable summary document for you to reference.
According to the Chancellor it is “All in, a Budget that backs small business":
- Further reduction in the rate of Corporation Tax – to 17% by April 2020, and more flexible uses of loss relief,
- Much increased thresholds for business rate relief, absolving many small businesses from paying rates,
- No increase in fuel duty,
- Abolition of Class 2 National Insurance for the Self-employed from 2018,
- Rewarding investment by cutting rates of Capital Gains Tax, except for residential property
- Extending Entrepreneur’s Relief for investors,
- Incentivising work with higher personal allowance and basic rate income tax band.
- Some businesses (cleaning hospitality and retail in particular) will be hit by the already announced National Living Wage,
- The recognition of the weak global economy,
- Reducing R & D tax credit claims with the lower Corporation Tax rate.
How will it be paid for?
- Government spending cuts,
- Tax evaders and avoiders,
- Multinationals avoiding their fair share of UK tax,
- Restrictions on loss relief for large companies,
- Tighter rules for personal service companies,
- Increased rate of tax on company distributions
- The new dividend tax announced previously.
- Stamp Duty Land Tax on purchases of commercial property over about £500,000
- Additional stamp duty on additional properties (announced previously)
- Insurance premium tax increase, earmarked for flood relief,
- Smokers and wine drinkers.
A bullish budget from the Chancellor despite the looming threats seen in the global economy,
Encouraging regional devolution initiatives and investment, particularly with regard to the South West, where we have a substantial business , not least the halving of the Severn Bridge Tolls.
We will, of course, be happy to discuss with you any of the points covered in this report, and help you adapt and reassess your plans in the light of any legislative changes.