The Spring Budget yesterday had some implications for small businesses. We’ve summarised the main points below:
Tax
- Corporation Tax will increase from 19% to 25% for businesses with taxable profits over £250,000. Businesses with profits between £50,000 and £250,000 will pay between 19% and 25%. Businesses making profits of less than £50,000 remain at the 19% rate.
- Fuel duty has been frozen so the 5p cut to petrol and diesel will remain in place for another year.
- Businesses can deduct investment in new machinery and technology to lower taxable profits. The super-deduction has been replaced with full expensing.
- Increase in Draught Relief will help pubs but alcohol taxes to rise with inflation.
- 12 new Investment Zones to be created across the UK, covering West Midlands, Greater Manchester, North East, South Yorkshire, West Yorkshire, East Midlands, Teesside, and Liverpool. At least one investment zone each in Scotland, Wales and Northern Ireland.
- The Pension Lifetime Allowance before paying extra tax – currently £1.07m – has been abolished. The pensions annual tax free allowance will rise by 50% from £40,000 to £60,000.
- Enhanced credits for businesses that have R&D as 40% of turnover.
Workforce
- Skills boot camps and apprenticeships targeted at over 50s to encourage people to return to the workplace.
- 30 hours free childcare for working parents in England expanded to cover one and two-year-olds by September 2025. This will be introduced in phases from April 2024, starting at 15 hours.
- £600 incentive payments for those becoming childminders and relaxed rules in England on how many children childminders can look after.
- A new voluntary employment scheme, Universal Support, announced for disabled people and those with health conditions in England and Wales.
Energy
- Energy support for households has been extended for three months until the end of June.
- No changes were announced to the Energy Bills Discount Scheme for businesses, which will run from 1 April 2023 to 31 March 2024.
Trade
- Commitment to ease customs declarations for small businesses that trade internationally.
