The new UK Chancellor (yes another one...can you believe the UK had 4 Chancellors in 4 months in 2022) has given his first budget. And as before we have refined the main points and facts for business owners including SME's and entrepreneurs. So you can easily navigate and plan ahead with clarity.
The main points from the budget are:
1. Energy price guarantee for homes will remain at £2,500 extended for only 3 months until end of June. It was set to rise to £3,000 but that has now been cancelled. And no new support announced for business bills.
2. Corporation Tax for a limited company will rise from 19% to 25% from 6th April 2023. Small company's with profit of less than £50k will still pay the lower 19%. But companies with profits between £50k to £250k have to pay between 19% and 25% but are allowed to claim marginal relief. Company profits over £250k will be taxed at 25%. And companies with group ownership of other companies may end paying close to 26.5% (effectively) because the corporation tax for Group Companies was increased also - sadly all important details missed by the main stream media.
3. Tax-free yearly allowance for pension cash out to rise from £40,000 to £60,000 after being the same for the past 9 years.
4. Fuel duty (tax) frozen so the 5p cut to fuel duty/tax on petrol and diesel which was due to end in April, has been extended for another year.
5. Maximum amount a worker can accumulate in pensions over their lifetime before paying extra tax currently £1.07 Million will be cancelled. Now there is no limit.
6. Tax on tobacco to increase by 2% above inflation for normal and 6% above inflation for hand-rolling tobacco.
7. Those who are already drawing down on their pensions, the total amount they can save tax free under the Money Purchase Annual Allowance is increased from £4,000 to £10,000 from April 2023.
8. 30 hours of free childcare for working parents in England expanded to cover 9 months to three year olds.
9. New £600 "incentive payment" for people becoming childminders, and the rules have been changed in England to let childminders look after more children.
10. Immigration rules to be relaxed for five roles in the construction sector, to ease labour shortages in the Industry. These categories are:
11. Super deduction of 130% will end on 31/03/23 and move back to 100% AIA for plant and machinery purchased and can be used directlty against corporation tax payable. A list of typical purchases is lasting until 31/03/26:
If your worried how these will effect you and need more specific guidance to help your business carry on growing during turbulent times then contact one of our Tax Affinity expert business advisors today (click here). With their countless years of knowledge and expertise they can guide your business to success even in the toughest of economic conditions.
By Anni Khan at Tax Affinity Accountants
Tax Affinity Accountants are experts Business, Tax and Accountancy. With branches in Worcester Park and Kingston upon Thames and Epsom and Ewell they are considered in the Industry to be expert business accountants and tax advisors for both individuals and small & medium sized businesses (SME's). Helping and supporting both individuals and limited company owners / self employed people throughout the UK and the world, they regularly help clients grow their business providing tailored advice and support. Their support has been considered invaluable by many clients and key to their success.
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