Last week, Chancellor of the Exchequer Philip Hammond delivered a Spring Budget that sought to address some of the issues facing small businesses in Somerset and the SW, Whther he was successful, is open to debate and opinion, but we thought you might like a summary of the key points so you can make your mind up for yourself.
In brief, the chancellor confirmed those measures due to take place from April this year, namely income tax allowances for trading and property income, restrictions on rent relief for buy-to-let landlords and the cut in Corporation Tax to 19%. There are new developments in ISA investment, offering a new ‘Lifetime ISA’ option and an increase in the investment limit and a delay in requiring quarterly online reports to HMRC from small businesses until April 2019.
News that there will be some transitional relief for small businesses adversely affected by the rise in business rates brought a little optimism, but was generally felt to be insufficient, and the news that Class 4 National Insurance contributions for the self-employed are to rise in 2018 and 2019 was met with dismay, with many considering that the Treasury was not properly acknowledging the disadvantages of self-employment in terms of security, sick pay and holidays. There is also a reduction in the tax-free allowance on dividends to £2000, further adding to the tax burden of small business owners.
There is to be £16 million for a national 5G Innovation Network to trial new 5G technology, but as some parts of the county struggle to access even 3G this will frustrate rather than appease, even though Hammond announced £200 million for local projects to build fast and reliable full-fibre broadband networks.
Disappointment was felt by many analysts that a budget supposed to make Britain a great place to start a business actually prioritised big business over small and start-up businesses. and concern was expressed at the lack of movement in the appointment of a ‘Small Business Commissioner’, a post which was due to be filled later this year.
Overall it was not a budget to give small businesses and sole traders in Somerset much to cheer about.
Full details of the budget can be found on the Treasury website at www.gov.uk/government/news/spring-budget-2017-21-things-you-need-to-know