Mr Osborne stated that this Budget, “backs small business owners and the self-employed”. In our view nothing of any significance has changed.
The items that caught our eye for our small business clients were:
Pension funds (again)
The lifetime allowance on pension funds is reducing from £1.25 million to £1 million. Most of our small business clients do not have pension pots approaching this size. However Mr Osborne did confirm that 40% tax relief on pension contributions is continuing.
Company Cars
Company cars are set to get (even) more expensive. The Chancellor has made most company cars prohibitively expensive and now he is increasing the charge on very low emission cars and the set percentage will increase by 3% for all other cars in 2019-20. This should make everybody think twice about a company car. There is a calculator on the website and it will be updated for the new data when the new tax year starts.
Superfast broadband
Super fast broadband is to reach into more rural areas, speaking as we do from the outskirts of Reigate (in not so rural Surrey) this increase in capacity cannot come soon enough!
Business rates
Business rates are to be reformed. This could be great news for all businesses but it is particularly aimed at shops and the competition with on-line traders.
Class 2 national insurance
Class 2 national insurance is to be abolished. It is not clear how the self-employed will accrue qualifying years for state pension but it will save all self-employed earners £146 in 2015-16.
Personal allowance
The personal allowance will be £10,600 in 2015-16 and will increase by £200 per year to reach £11,000 in 2017/18.
Savings exemption
New savings exemption of up to £1,000 – this could mean the end for cash ISA’s.
Trivial benefits exemption
Trivial benefits relief which will allow director’s of family company’s and their relatives to receive benefits of up to £300 per year without any tax arising.
If you want help in understanding what the Budget 2015 means for your business then please contact Clearways Accountants using the contact form below or by calling us on 01737 244298.
Image courtesy of Vichaya Kiatying-Angsulee at FreeDigitalPhotos.net