Here’s a summary of the main points from this year’s budget that could affect you as a business owner.
- The VAT threshold will remain at £85,000 for the next 2 years.
- The Personal Allowance will increase to £12,500 from April 19th.
- The Higher Rate tax band will also increase to £50,000 on April 19th. (This is a year earlier than planned!)
- Lettings relief will now only be available when a tenancy is shared. If that’s the case, a further change is that the final exempt period you can claim has reduced from 18 months to 9 months.
- The Corporation Tax rate will reduce to 17% in 2020.
- Annual Investment allowance is increasing – but only for two years – to £1M, for assets purchased from 1st January 2019 to 31st December 2020. It will then reduce back to the current rate of £200k.
- The qualifying period for Entrepreneurs Relief is doubling to two years; this means that if you’re planning to claim this relief, you must meet the criteria for two years rather than one.
- IR35 changes: from April 2020, all companies and agencies (not just the public sector) will be responsible for carrying out IR35 checks and report to HMRC. However, small companies are exempt from this – but that doesn’t mean they won’t be hit… If their contract is supplied by a medium or large company, they could potentially be deemed as IR35.
Please note that this is a very basic run-down of some of the changes that might affect you. Click here for a full list of changes to the budget, or call us for more information on 020 8530 0720.
