Budget 2013: What does it mean for growing businesses?
A breakdown of the chancellor’s plans for fast growth companies
With today’s Budget Report revealing a drop in the 2013 growth forecast, the chancellor of the exchequer George Osborne outlined his plans to support business growth to get the UK back on track for 2015.
The growth expectations for 2013 fell from 1.2% to 0.6% and from 2.0% to 0.8% as Osborne delivered his Budget Report, but nonetheless, through support for “those who aspire to work hard and get on”, the chancellor is determined that the UK will meet its expectations of 2.3% growth by 2015.
Growing Business highlights the key measures revealed in today’s report that are set to affect growing companies, the industries due to receive a boost and the support promised to investors.
Tax cuts and reliefs
- The government has committed to reducing the main rate of corporation tax by an additional 1% in April 2015, bringing it to 20%per cent, the joint lowest level in the G20.
- From April 2013 business owners will benefit from an ‘above the line’ R&D credit at a headline rate of 10%.
- 100% capital allowance will be offered to business owners who purchase the lowest emission vehicles.
- Osborne also announced a crackdown on tax avoidance, including schemes designed to encourage avoidance.
Funding and grants
- The government has pledged £1.6bn to strategies that support 11 key sectors: automotive, aerospace, life sciences, agri-tech, professional business services, information economy, construction, education, nuclear, oil and gas, and offshore wind. This funding will be allocated over the course of 2013.
- The government also promises to complete major projects in 2013 worth over £2bn, including major upgrades to roads. Support for investors
- Investors in start-ups will be rewarded by an extension of Capital Gains Tax relief. They will receive relief on capital gains arising in 2013 to 2014, as long as they are reinvested in that year, or the following year through the Seed Enterprise Investment Scheme (SEIS).
- The stamp duty on AIM shares will be abolished from April 2014.
- In an effort to encourage private investment in social enterprises, the government will provide tax relief to investors, to be introduced in Finance Bill 2014.
Support for your staff
- The government plans to introduce a new employee shareholder status that gives staff the option of giving up some of their existing employment rights in exchange for shares in the company worth a minimum of £2,000.
- From April 2014, all businesses and charities will be eligible for a new Employment Allowance, which will provide business owners with £2,000 off their employer National Insurance Contributions (NICs) to help them to hire new staff.
- Following Doug Richard’s review on the importance of apprenticeships, the government has launched a consultation on implementation of the Richard Review, to raise the standards of apprenticeships.
- Employers will be able to offer interest free travel season ticket loans to their staff of up to £10,000.