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The focus on business in this budget does seem to take account of smaller businesses for once too, although as ever with Philip Hammond the devil's in the detail and the detail is relegated to the big Red Book - if it's there at all and not just another consultation!
This will be increased to £1million for two years from 1st January 2019. This allowance (currently £200,000 lets you reduce your tax bill by taking in to account the cost of qualifying investments in plant & machinery.
Previous restrictions on the total claim of R&D tax credits will be reinstated from April 2020 for loss-making companies. From April 2020, the claim will be restricted to three times the company's total PAYE & NIC liability for the year. There will be qualifying conditions and is in place to target identified abuse of the scheme.
From April 2020, only employers with total National Insurance contributions below £100,000 in their previous tax year will be able to make an EA claim. The EA allows qualifying businesses to reduce their employer NIC bill by up to £3,000.
The minimum qualifying period to meet the rest of the conditions will increase to 24 months from 6th April 2019 from its current 12 months, contributing to the aim of supporting longer term business investments.
With various changes to the levy and Apprenticeship scheme in general, the highlight here is the government is halving the investment rate for employers from 10% to 5% for apprenticeship training.
The National Retraining Scheme is still around as well.
More funding for plastics R&D and approaches to recycling. The Chancellor once again highlighted plastic packaging, single use plastic and disposable cups. Now this is on everyone's watchlist he's giving companies time to reform, but will be introducing a tax on the production and import of plastic packaging in 2022. There will be a consultation, but any plastic packaging doesn't contain 30% of recycled plastic or more will be liable for this tax.
This is absolutely an area to review and improve.
Consultations on extending planning rights above commercial premises and looking at redeveloping underused retail/commercial centres in to housing. Positive changes tax relief for new non-residential structures and buildings seems to put this at odds - but both measures are to encourage businesses and the high street. Schemes to support SME housebuilder lending were announced too.
HMRC are continuing to look at ways to reform the VAT threshold, to make a smoother transition for small businesses rather than the current cliff-edge of registration. With heavy hints things will be different post-Brexit, no change will be made to the current VAT threshold of £85,000 until April 2022.
A one-third cut to business rates for retail properties with a rateable value below £51,000 for 2 years, from April 2019.
For anyone who uses contractors and is a 'small business' (yet to be defined) - confirmation that IR35 changes won't apply is a happy relief. As qualifying criteria are announced we'll give more information on who these changes will apply to.
The growth forecast has been downgraded from 1.5% to 1.3%.
Whilst it may not be a Halloween 'Hammo House of Horrors', given the upheaval and unknowns we're facing it's almost a budget that hopes to merrily ignore this and carry on regardless. The Chancellor is clearly trying to give the economy a kick with plenty of incentives for growth and new programmes, reinforcing that everything will be well, but he's still reserved the Spring Statement as a potential budget - an upgrade which will almost certainly happen.
Tags: Tax, Business, Budget
