Posted by lesley on March 21, 2013
Welcome to this budget edition of our news page, with a summary of the most relevant and important measures announced by the Chancellor in his 2013 Budget.
Key points affecting small and medium-sized businesses include:
Taxation
• The main rate of corporation tax will be reduced to 20% from April 2015.
• The VAT registration threshold will be increased to £79,000 from April 2013 and the deregistration threshold increased to £77,000.
• The income tax personal allowance will be increased to £10,000 from April 2014.
• The Government is to consult on plans to simplify and reduce administration for self-employed people, by using Self Assessment to collect Class 2 National Insurance Contributions (NICs) alongside income tax and Class 4 NICs.
• From April 2014, all businesses will be eligible for an Employment Allowance of £2,000 to offset against their NICs.
• The Government will extend capital gains tax relief to encourage investors to take up the Seed Enterprise Investment Scheme (SEIS). Investors making capital gains in tax year 2013-14 will receive 50% capital gains tax relief when they reinvest those gains into seed companies during tax year 2013-14 and 2014-15.
• A consultation will take place in Summer 2013 on plans to introduce tax relief to encourage private investment in social enterprise.
Growth and support
• £1.6 billion of funding will be provided to support the life sciences and aerospace sectors, and will be allocated by the end of 2013.
• Several strategies for supporting the creative industries has been announced, including a competition of £15 million launched by the Technology Strategy Board for digital content production by specialist small businesses, educational research facilities and training providers; increasing funding for the Skills Investment Fund to £8 million each year for the next two years; and launching a public consultation on plans to provide support to the visual effects industry.
• The Government will launch a £30 million Growth Vouchers programme for small and medium-sized enterprises in England, to help them overcome barriers to growth, such as limited access to external advice.
• The Government has accepted the majority of the recommendations made in the Heseltine Review on economic growth, for example creating a Single Local Growth Fund allocated to Local Enterprise Partnerships (LEPs) to support local economic growth. The Single Local Growth Fund will be operational from April 2015.
• The new Business Bank will introduce a £300 million investment scheme to help diversify sources of funding for small and medium-sized businesses; provide £75 million of funding for venture capital; and increase funding of the Enterprise Finance Guarantee (EFG) scheme to encourage lenders to provide finance to small firms.
• The Small Business Research Initiative (SBRI) will increase the value of government contracts available to smaller firms from £40 million to over £100 million in 2013-14, and rising to over £200 million in 2014-15.
The full Budget report and associated notices are available from HM Treasury at:
http://www.hm-treasury.gov.uk/budget2013.htm