This week’s Budget setting out the Government’s updated economic strategy wasn’t packed with too many surprises, but did you spot the main elements that may affect your business?
Whatever your politics, here’s our quick run down of the main points you may like to look at in more depth. You can find full details of the Budget announcements on the HM Treasury website
A re-confirmation that Belfast, Birmingham, Bradford, Bristol, Cardiff, Edinburgh, Leeds, London, Manchester and Newcastle have been selected to become broadband super-connected cities. The £100 million investment was first announced in the 2011 Autumn Statement and a further £50m has been announced to fund a second wave of cities.
Corporation Tax cut
In an attempt to spur on more companies to drive the economy forward, the main rate of corporation tax is to be reduced by an additional one per cent. The rate will now reduce from 26 per cent to 24 per cent in April 2012 and then to 23 per cent in April 2013 before a further reductio to 22 per cent by April 2014.
Corporation Tax relief for certain tech
Subject to final state aid approval, new Corporation Tax reliefs will be introduced from April 2013 for the video games, animation and high-end television industries.
Simplification of small business taxation
The Government has announced a consultation, reference introducing a voluntary cash basis for unincorporated businesses up to the VAT registration threshold as well as a simplified expenses system for business use of cars, motorcyles and homes as well as the possibility of a disincorporation relief.
VAT Threshold increase
From this April, the VAT taxable turnover threshold, governing who must be registered for VAT will be increased from £73,000 to £77,000.
Income Tax changes
For those lucky enough to be earning over £150,000 you are probably well aware that the top rate of income tax will be reduced from 50% to 45% in April 2013. The key change however, affecting almost everybody in the working world, is the rise in the basic individual income tax personal allowance to increase by a further £1,100 – taking it to £9,205 in total – also by April 2013.
Enterprise Management Incentive Scheme
This scheme designed to help SMEs recruit and retain talent is set to provide additional support to help start-ups access the scheme and more than double the grant limit to £250,000. A more detailed blog about this scheme is already planned by 123-reg in the next few weeks.
Obviously, there are many other aspects that will impact on your business but we believe these will be the main items you probably need to be considering in the next few months. We will be following up on a number of these points in our business-focused blogs in the next few weeks.