This time of year all eyes turn to a little red briefcase and inside that briefcase is the latest Spring Budget. This was Philip Hammond's first budget as Chancellor of the Exchequer and SMB's were keen to how will the Spring Budget affect small business in the UK.
The Budget brought mixed news for small businesses with certain reliefs being offered but also new tax rates for the self-employed. There was also a carrot dangled for certain SMB's working in the tech industry.
Here is a brief overview of the Spring Budget and what it means for small businesses in the UK.
Corporation Tax reduced
Previously it was planned that Corporation Tax would reduce from its current 20% to 18% by 2020. It is now set to fall to 17% meaning lower taxes bills by 2020 for UK firms.
Business rate relief level increased
£435 million has been allocated to support business affected by the business rates relief revaluation. This means firms facing an increase in business rates will only pay a maximum of £600 more in rates then they did in 2016/17.
Increase in NICs contribution for self-employed
Changes have been made to the different National Insurance Contributions (NICs) the self-employed currently pay. Class 4 NICs will rise to 10% in April 2018 and then in April 2019 to 11%. This raise will only effect self-employed people with profits over £16,250.
£200m for fibre broadband
As the Government continues it's efforts to have superfast broadband coverage across the whole of the UK, £200 million has been made available to help small businesses. The aim is to increase demand for broadband in less populated areas, thus making suppliers increase their coverage areas. This is great news for rural businesses who can to struggle with poor connection.
Delay in Making Tax Digital
Making Tax Digital was always going to have an affect on small businesses. Any business with a turnover below the VAT registration threshold will benefit from a one year delay on the introduction of quarterly reporting.
Fuel duty frozen
For the 6th year running fuel duty tax has been frozen at 57.95 pence per litre. This has the potential to be a massive saving for small businesses. As much as £75 per year, per driver could be saved.
Big wins for Technology
It had been discussed as part of Brexit that the UK wanted to become a major player in the tech world. The Spring Budget has backed that up with incentives for education, research and innovation.
An investment of £270 million will be spent in 2017/18 on "disruptive technologies." This will include the whole manufacture process of batteries to power the next generation of electric vehicles.
£16 million has been set aside for a "cutting edge 5G facility." 5G was a hot topic at this years Mobile World Congress and whilst the technology is still a way off it appears the British Government is keen to be a driving force behind it.
Starting in 2019/20 the Government will provide maintenance loans to students for technical education courses in National Colleges and Institutes of Technology.
There is a lot for small businesses to be pleased about in the Spring Budget. Whilst the self-employed have taken a hit there are still plenty of incentives to encourage businesses in the UK. The tech industry will be excited by the significant backing they have received.
Has the Spring Budget had an affect on your business? Let us know in the comments. If you've found this post helpful please share it with the buttons below.