For those who are new to the annual Budget speech, or want a quick insight into how it will impact their small companies, Business Advice has put together a convenient summary so you don’t have to sift through announcement after announcement.
Reform to stamp duty for small businesses
The stamp duty rates system for commercial property is being overhauled, with some 90 per cent of small firms seeing tax bills cut or go unchanged as a result. A zero rate band for commercial stamp duty has been introduced for the first time, with changes set to come into force overnight.
Reform to business rates for small businesses
One million small UK businesses are set to benefit from rate relief, Osborne announced in the Budget 2016, as part of a permanent increase in the business rate relief threshold to £15,000. It’s predicted this will save small companies some £6,000 a year, with 600,000 soon to pay rates at all.
VAT loophole for oversees internet merchandisers closed
Sure to appeal to enterprising entrepreneurs throughout the UK, foreign companies storing stock in the UK but avoiding VAT payments will have those loopholes closed. It follows an HMRC-established taskforce set up in December 2015 to investigate VAT evasion by overseas companies, and will benefit those selling through platform such as Amazon or eBay.
Tax breaks, worth £1,000 a year, for trading and property income
The “Airbnb allowance” or “spare room subsidy”, two terms already associated with this policy, will allow enterprising individuals to be exempt from tax for the first £1,000 made through selling services or renting property online. With no forms to fill in or taxes to pay, Osborne described it as a “tax break for the digital age”. Some half a million people are expected to benefit on the back of the Budget 2016.
Removal of Class 2 NI contributions by 2018
The Budget contained another surprise, in the form of Class 2 National Insurance (NI) contributions being abolished from April 2018. The Treasury believes this will serve as a benefit to self-employed individuals to the amount of £130 each year.