As Philip Hammond shared the 2018 Autumn Budget and thanked the British public for their hard work, he had a number of announcements for small business owners – on everything from personal tax allowance to business rates.
The Chancellor opened his Budget 2018 speech by saying it would be “a Budget for hardworking families… the strivers, the grafters, and the carers who are the backbone of our economy." But what does this mean for small businesses?
Personal tax allowance is the amount you are allowed to take home without paying tax. Anything you earn above that is taxable at a varying rate dependant on your total income.
The chancellor announced that personal tax allowance will be raising to £12,500 for basic rate tax payers, and £50,000 for higher rate tax payers in 2019.
If you’re a bricks and mortar shop, the Chancellor’s proposed Future High Streets Fund may well be of interest to you.
In the Budget, Philip Hammond announced £675 million worth of co-funding for local councils to plan the future of their high streets.
He suggested this could include converting commercial premises into residential ones to increase footfall, and claimed that while it could take time to adapt, the rise of online shopping meant that the changes we’ve seen in recent years is irreversible.
The Chancellor also declared he will be cutting the business rates bill for the smallest of small businesses. Businesses with a rateable value of £51,000 and under will see their bill cut by a third over a two-year period.
According to the Budget announcement, this will lead to up to £8,000 worth of savings.
Ahead of the Budget, there was a lot of talk about a digital services tax, which had some online retailers worried about their position.
However, the tax announced today will only apply to to businesses that generate millions in global sales, but it remains to be seen whether this tax will have an impact on businesses that sell through sites like Amazon and Ebay.
While the Chancellor made mention of the environment in his Budget announcement, there was only one tax announced – companies manufacturing plastic that is less than 30% recycled material will face a levy.
He also said that he had considered a plastic cup tax, but decided that it wouldn’t make a substantial change. He will, however, continue to monitor progress, and may introduce another tax if things don't improve.
In summary, here are the major points for small businesses to be aware of in the wake of the 2018 Autumn Budget:
While this is some of the biggest news that will impact small businesses in the UK, the Chancellor announced a number of other measures you might want to keep your eye on. These included:
What do you make of this year’s Autumn Budget? Let us know in the comments.
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