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Budget 2014: Key measures for business

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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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