Budget 2014: Key measures for business

Chancellor George Osborne has finished delivering what he called his “Budget for makers, doers and savers”.

We’ve picked out the main measures that will affect businesses from his speech:

The big ones

  • Sweeping reforms to pensions and personal savings.
  • The Investment Allowance will be double to £500,000 and extended to the end of 2015, from April. This will make a huge difference in particular to manufacturers, production businesses and agriculture. Some 99.8% of businesses will get a 100% investment allowance.
  • £7bn package to cut energy bills for British manufacturers.

Personal tax

Investment in SMEs

  • The Seed Enterprise Investment Scheme, a hugely attractive scheme in incentivise investment in start-ups, will be made permanent.
  • A Social Investment Tax Relief at a rate of 30% will encourage investment into social enterprises.
  • Extending grants for smaller businesses to support 100,000 more apprenticeships.

Cost-savings for businesses

  • Compensation worth £1bn to protect manufacturers from green taxes.
  • Enterprise zones: business rates discounts and enhanced capital allowances will be extended for another three years.
  • The rate of R&D tax credits for loss-making small businesses from 11% to 14.5%.

Business transport

  • The 2% increase in company car tax will be extended in 2017-18 and 2018-19.
  • Tax on all long flights to be lowered to match the low rate for flights to the US, and tax in private flights introduced.
  • Start-up support for new routes from regional airports.
  • HS2 to “go further north faster”.
  • £270m for Mersey Gateway Bridge.
  • New tax and borrowing powers to improve transport infrastructure in Wales.

Tax avoidance

  • Increase in HMRC budget
  • Powers to allow them to claim from bank accounts where individuals refuse to pay
  • Stamp duty of 15% on property bought through a corporate envelope

The oldies but goodies - previously announced but worth recapping

  • Corporation tax, as previously noted, lowered to 21% this year.
  • Employers no longer need to pay National Insurance Contributions for under 21s.
  • An employment allowance will cover the first £2,000 of National Insurance for each business.

 

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