2024 Spring Budget - What it Means for SMEs

08-March-2024 12:06
in Mortgage
by Sam Hodgson
2024 Spring Budget: What it Means for SMEs

Cuts to National Insurance, an increased VAT threshold, and frozen alcohol duty—will these help businesses in the cost-of-living crisis? 

Chancellor Jeremy Hunt’s Spring Budget has indeed been wrought with controversy since its announcement on Wednesday. The primary change that has the media abuzz and may pose one of the most significant changes for British businesses is that National Insurance is being cut by a further 2%. This means that for a lot of British workers, National Insurance will have dropped from 12% to 8% in less than six months.  

Business owners will need to update payroll before these changes come into effect on April 6th. National Insurance is also being cut for self-employed individuals earning under £50,270 – dropping from 8% to 6%. The proposed cuts are set to save the average self-employed worker roughly £650 a year.  

In addition, the Chancellor has promised to offer additional relief to SMEs by raising the VAT registration threshold to £90,000. The current threshold, which sits at £85,000, poses an additional financial and administrative burden for growing businesses that were already under pressure during the recession.  

The 2023 Autumn Budget introduced full expensing, a temporary allowance offering start-ups the opportunity to claim 100% of their expenditure within their first year. In the Spring Budget, this initiative was made permanent and extended to leased assets, which may be a breakthrough for enterprises relying heavily on finance.  

2024 Spring Budget: What it Means for SMEs

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Holiday-let owners may be disappointed to learn that the government is abolishing the Furnished Holiday Lettings Regime, which allowed them to save thousands on Capital Gains and Income Tax. 

The government is freezing alcohol duty in a bid to support pubs across the country. But pub owners have responded that this may be too little, too late, as thousands of bars, pubs, and restaurants have closed since 2020.   

During the announcement, Hunt pledged to help growing businesses and families. This legislation may be the current government’s last chance to win the nation’s vote before a General Election, predicted for May. 

Related: Spring Budget 2024 - 5 Property Takeaways & How to Get a Limited Company Buy to Let Mortgage

Access Fast Business Funding

In many cases, enterprises can find it difficult to rely solely on revenue in their early days. Business finance can empower SMEs to invest in growth and seize opportunities they might not otherwise have access to.  

If you’re not sure where to look for business finance or how to find the best rates, we can help. At Clifton Private Finance, we have a team of business finance specialists who can get you access to the funding you need.  

We offer a range of business loan solutions, from securing finance for an existing business to acquiring a business. Every business is unique, so our business finance experts provide bespoke financing solutions. 

To see what we can do for you, call 0203 880 8890 or book a free consultation below. 

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