During his announcement George Osborne revealed a number of new measures that will have major repercussions for small and medium-sized enterprises (SMEs).
One of the biggest sectors to benefit from the budget was retail, where businesses based on the high street will see their £1,000 business rate discount increase by half to £1,500. This was part of a wider promise by the Chancellor to review business rates in the future.
This is a move that will be welcomed by pubs, restaurants and shops who have been struggling to compete with large supermarkets and online shopping.
Mr Osborne also declared that the Government would increase the amount of research and development tax relief SMEs received by 230%. He said that the Government wanted “British businesses [to] do more research and development – this is crucial to our productivity."
This move will allow a lot of SMEs to free up finances in other areas of the business, giving them the ability to quickly expand.
However, it is the changes to stamp duty that are likely to affect the majority of people. In a move aimed squarely at the sites of destroying any prospect of Labour’s “Mansion Tax”, Mr Osborne announced major reforms to Stamp Duty that will see individuals buying homes worth over £1.5 million, pay 12% of the cost of the property upon purchase.
The new measure, which will come into force from midnight tonight (3 December), will see no Stamp Duty paid on the first £125,000 of a property’s value, followed by 2% on the next £125,000 of a property’s value, then 5% on the next £675,000 of a property’s value, followed by 10% on the next £575,000 of a property’s value, while any properties over this amount will pay 12 % on the remaining value.
Dan Morgan, Tax Partner at JW Hinks said: “The introduction of higher business rate discounts for high street businesses and the increase in research and development tax relief shows that the Government has finally begun to recognise and reward SMEs for their role in driving the UK economy forward.
“Much of the 3% growth in GDP can be traced back to these firms, many of whom are our clients, and remain the backbone of Britain’s economy.
“But while businesses may be celebrating, people with homes valued over £1.5 million may not. For them this Autumn Statement could have a number of implications on their future.
“The move, which appears to be aimed at sinking Labour’s Mansion Tax, has fallen short of the mark and would fail to collect even a small amount of the yearly income proposed in the Opposition’s policy.
“If you have any concerns following the Autumn Statement then we are only happy to help.”
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