Chancellor Philip Hammond went to great lengths in his Budget 2018 speech to reinforce that “Britain is open for business”. Subsequently, the Chancellor announced a string of measures designed to provide a shot in the arm for the UK’s small business community.
Mr Hammond’s pledge to stimulate business growth and investment centred on four key announcements pertinent to small firms and their long-term future.
Apprenticeship levy halved for small business owners
The existing 10% levy that small businesses must pay when they hire new apprentices has been halved to 5%, a move that will take effect from April 2019. The announcement is part of a “£695 million package to support apprenticeships”.
It isn’t yet known if employer contributions will also be applicable to those who have already spent their levy pot.
In his Budget 2018 speech, the Chancellor revealed that the country has created three million “high-quality apprenticeships” through the Government’s Apprenticeship Levy.
Business rates cut by a third for smaller retailers
Independent retailers with commercial properties with a rateable value of £51,000 or less will have their business rates cut by one third from next year.
This is part of a broader £1.5 billion package to help revive the UK’s struggling high streets.
Employment Allowance retained for small businesses
From April 2020, the Government has announced it will restrict Employment Allowance to smaller businesses with employers’ National Insurance contributions (NICs) totalling less than £100,000 per annum.
Employment Allowance exempts the first £3,000 of employers’ NICs and this decision should ensure that most small businesses will retain this exemption.
Entrepreneurs’ Relief retained
Despite the Chancellor being “encouraged” to scrap Entrepreneurs’ Relief, he confirmed today that he will not.
He has opted to extend the qualifying period from 12 months to two years; a move designed to support longer-term investments in growing businesses.