The government has extended the Recovery Loan Scheme by six months. It’s also announced money to improve ‘digital’ elements of society, including the NHS, museums and libraries, and the border.
Download your free in-depth guide to the relevant announcements for contractors and freelancers.
The Chancellor, Rishi Sunak, gave the Autumn Budget and Spending Review on 27 October, after a number of updates had been announced to the media already.
The government has extended the UK-wide Recovery Loan Scheme by six months. It was originally due to end on 31 December 2021 and will now end on 30 June 2022.
The Recovery Loan Scheme will let eligible businesses apply for up to £2 million.
The government originally guaranteed 80 per cent of the finance, but this will be reduced to 70 per cent. The borrower is always liable for 100 per cent of the repayments.
However, only 5,137 UK businesses have made use of the scheme so far, according to the British Business Bank.
Contractors and freelancers who work with technology will note that the government has set aside packages to improve digital elements of society.
The government has confirmed more than £5 billion for the NHS, in addition to the £36 billion reform package previously announced in September.
This new money will in part be used to improve the NHS’s digital capabilities, after Health Secretary Sajid Javid said that one in 10 trusts still operate on “paper-based systems”.
There’s also more than £75 million going to 110 regional museums and libraries to improve their buildings and digital facilities.
Finally, the government is setting aside £628 million “to modernise and digitalise the border”. Proposals include a US-style Electronic Travel Authorisation for tourists who want to visit the UK.
Tax rises were already announced in September, but the government has reiterated that National Insurance contributions and the dividend tax will both increase by 1.25 percentage points from April 2022.
For the self-employed, this means that:
However, Sunak said during the Budget announcement that he’s committed to cutting taxes by the end of this parliament.
The annual investment allowance lets you deduct 100 per cent of the cost of plant and machinery you use solely for business, including computers, from your business’s profits before working out tax.
The annual investment allowance limit was temporarily increased to £1 million until 31 December 2021.
The government has announced that this will now last until March 2023.
If you travel for business, the government has confirmed plans to ‘level up’ transport in England’s cities outside London. The government is also investing in roads and rail to improve journey times between cities.
The government has reiterated that nearly £7 billion is set aside in this Budget for improving transport in England’s cities. This focuses on ‘intracity’ transport, which involves helping people get into (and back out of) city centres – namely train, tram, bus and cycle projects.
Of this money, however, only £1.5 billion is new. The Shadow Chancellor, Rachel Reeves, has criticised the government, telling Sky News: “what we’re sick of in the north is having announcements without the delivery on the ground.”
Devolved administrations will get funding through the Barnett formula.
The British Business Bank has launched a Regional Angels Programme, which is an angel investor scheme that aims to “help reduce regional imbalances in access to early stage equity finance for smaller businesses across the UK”.
The government is giving the programme £150 million at this Budget. Suren Thiru, Head of Economics at the British Chambers of Commerce, said: “The funding will help ensure some of our most promising young companies across the UK get access to the finance they need to support their growth journey.
“Ministers must continue to ensure that the programme has sufficient funding capacity to meet any future surge in demand.”
Read more about finding angel investors for your business.
Campaigners have been calling for umbrella company regulation, but this didn't get a mention.
Here’s a roundup of other announcements:
Alan Thomas, Simply Business's UK CEO, comments: “The Budget has come at a crucial time for small businesses as they look to continue their recovery from the ongoing impact of the pandemic. While today’s business rates announcements will support many in their attempts to rebuild after Covid-19, it’s vital that we recognise the contributions of small businesses across the board.
"It’s never been more important to support the self-employed, and we encourage the government to do all they can to aid their revival in the coming months and years."
Read our Autumn Budget 2021 guide for other businesses, which focuses on announcements like business rates and the national living wage increase.
What do you think about the announcements in the UK Autumn Budget 2021? Let us know in the comments below.
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