This afternoon, the chancellor presented the government’s budget and fiscal plan. Whilst the chancellor acknowledged in his speech that “UK growth has to come from the innovation and drive of entrepreneurs”, there was very little announced in today’s budget to affect businesses. There are a few announcements to bring to your attention:
Qualifying expenditure for R&D tax credits will include cloud computing and data costs, meaning that there’s probably more you can claim for. This will take effect in April 2023. If we already do your R&D claim for you, we’ll take care of this.
The temporary increase to the Annual Investment Allowance, which was due to end in December 2021, will now be extended to March 2023. This means that you can claim full tax relief on many assets purchased up to a combined value of £1m in a year.
Business rates are being slightly reformed. The headlines are (i) Business rates improvement relief, meaning no additional business rates will be charged on investments or extensions to properties; and (ii) a Green investment relief on the adoption of green technologies (i.e. Solar Panels); (iii) a 50% discount up to £110k on business rates for retail, hospitality and leisure business.
The Recovery Loan Scheme will also be extended until 30 June 2022. Finance will be available up to a maximum of £2 million per business. The government guarantee will be reduced from 80% to 70% to encourage the lending market to move towards normality as the economy continues to recover.
The National Living Wage is being increased to £9.50 per hour from April 2022.
The National Minimum Wage for people aged 21-22 will rise from £8.36 to £9.18 an hour, and the Apprentice Rate will increase from £4.30 to £4.81 an hour.
If you have any questions about any of the above, please don’t hesitate to contact us. As always, more detail may be published in the coming days, and we’ll keep you updated on any changes that may affect you.