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  • ​Autumn Statement 2016: what your business needs to know

    December 09, 2016

  • Philip Hammond made his first budget statement as Chancellor on Wednesday. While some parts could be predicted (such as the abandonment of George Osborne's targets for budget surpluses), others came as a surprise.

    It's a big speech to get through, so we've summarised the parts that might apply to your small business.

    Tightening up tax loopholes

    Mr Hammond hopes to earn £2 billion in revenue by putting an end to tax avoidance schemes, including flat-rate VAT schemes and the use of employee shareholder status. Any small business that currently uses a flat-rate VAT scheme for goods will need to check the new guidelines carefully. A new penalty will also be brought in for repeat offenders.

    Estate agent fees abolished

    Buy-to-let landlords have faced a lot of changes over the past year, and this budget has brought another one. Starting as soon as possible, agency fees (often used to pay for essential admin tasks like credit checks) will be abolished.

    Technology investments

    £1 billion has been earmarked for full-fibre broadband and 5G trials in the UK. This is good news for tech start-ups and freelance professionals who rely on speedy internet connections to complete their work.

    Lower corporation tax

    Corporation tax will be lowered from 20% to 17% by 2020, a boost for businesses registered as private limited companies (PLCs).

    Investment in productivity

    Hammond spoke about closing the "productivity gap" which sees Britain lagging behind most G7 nations. In his speech he noted that it would take a British worker five days to produce the same amount as a German worker would in four. This has been an issue for years, however the new national productivity fund of £23 billion aims to tackle it. The money will be spent on infrastructure and innovations to give British businesses a boost.

    Higher national living wage

    The national living wage will rise from £7.20 to £7.50 a year, a move that will make full-time, minimum-wage workers £1,400 better off each year but could negatively impact the bottom line for businesses across the board. The Federation for Small Businesses (FSB) has previously warned of the impact, particularly in the retail, hospitality, accommodation and wholesale sectors.

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