On 23rd November the Chancellor, Philip Hammond, delivered his first (and last) Autumn Statement. We provide you with our summary of the most important announcements for small business.
Economic growth forecasts have been revised down from 2.1% to 1.4% in 2017 following the Brexit vote.
The Chancellor has re-iterated the intention to reduce Corporation Tax to 17% by 2020.
One of the big announcements was a clamp down on Salary Sacrifice schemes whereby National Insurance is saved for employer and employee by provision on benefits in lieu of salary. However pension contributions, cycle schemes, ultra low emission cars and child care will remain untaxed benefits.
Increases in the National Minimum Wage were also announced up from £7.20 to £7.50 per hour from April.
New rules will require businesses on the flat rate scheme to have expenditure on goods (not services) of under 2% of gross turnover to move to a 16.5% flat rate. This will particularly affect personal service companies with little or no expenses.
The Personal Tax Allowance will increase increase to £11,500 in 2017 and up to £12,000 by 2020. The Higher Rate threshold will go up to £45,000 in 2017.
The ISA limit will increase from £15,240 to £20,ooo in April 2017
The government’s campaign to tackle tax avoidance continues. In particular new regulation is being introduced to remove a defence of having taken reasonable care in getting professional advise where the professional adviser stands to gain financially through whatever scheme that is being considered.
The Chancellor promised a further £400m in venture capital funds to be made available to business through British Business Bank.