The main fiscal event of the year is over, and with it plenty of critiques milling about online, it’s time to dig down into the nitty gritty and see what it all really means for small businesses.
As the buzz around this year’s Autumn Budget dies down, we take a look at the changes that will affect small businesses, freelancers and contractors, so you know exactly what to expect from April 2018.
Plans to lower the VAT threshold have been halted, it was announced in November’s Autumn Budget. After pleas from the Federation of Small Businesses, the VAT threshold will remain at £85,000 for the next two years, which will be welcome news for small firms and self-employed business people.
Personal allowance will also increase to £11,850 from April 2018 and the higher rate threshold will be raised to £46,350.
A £44 billion housing investment initiative was announced in the budget, which will contribute greatly to local communities and help small independent businesses, especially in the construction industry, thrive.
This year’s Autumn Budget has made an important change for businesses by raising business rates in line with consumer prices index (CPI) rather than the higher retail prices index (RPI). The ‘staircase tax’ has also been abolished, which would have hiked rates if a workspace is split over more than one floor of a building.
National Living Wage and National Minimum Wage increases
Philip Hammond also announced increases to both the National Living Wage (NLW) and National Minimum Wage (NMW).
The NLW will rise from the current £7.50 to £7.83 next April, while the NMW will increase to £7.38 for those age 21-24, £5.90 for aged 18-20, £4.20 for those aged under 18 and £3.70 for an apprentice.
Research and development funds
There will also be a cash injection to research and development, with the largest amount allocated to R&D in 40 years. A £2.3 billion investment from the NPIF to the sector will take effect between 2012 and 2022.