George Osborne’s 2013 budget was announced on Wednesday, only slightly overshadowed by the fact that he’d joined Twitter. Once the bellowing, Evening-Standard-ing and ‘briefcase wankering’ had died down, what was left for start-ups and SME’s?
£2000 tax cut for UK companies
Let’s start with the most positive. Osborne announced £2000 worth of National Insurance tax relief for every UK company – brought in to allow young companies to more easily take on staff. James Cann reckoned it was a really good move, stating:
“The private sector has been working hard to increase employment levels and the allowance to reduce the tax on employing people will help many small firms employ their first person and grow their businesses.”
This will hopefully ease the running costs of small businesses across the UK, allowing startups to consider taking on staff at an earlier time, and encouraging them to grow. So far, so hoorah! The only slightly annoying thing is that the legislation won’t officially change until next April, giving young businesses a year to wait until they can take advantage of the cut.
Corporation tax cut
Corporation tax was already due to fall to 23% this April, and to 21% the following year – Osborne has announced that it will fall again in 2015, to 20%. This will give us the lowest rate in the G20, lower than that of lots of our global competitors such as the US, Japan and Germany. The hope is that this will encourage global talent to set up shop in the UK, as well as ensuring that established UK businesses can use the savings to invest further in their ideas.
No fuel hike after all
Not quite so positive for the Green campaigners out there, but no doubt a good move for cutting costs to small businesses, the proposed fuel hike has been cut, meaning transportation and hauling costs will not rise, as feared. This means fewer costs for fledgling young companies, and hopefully more money to invest in the companies themselves.
More loans for small companies
The Start-Up Loan Scheme – designed to support young entrepreneurs – received another boost (after its extra £30 million in January), bringing its total to £117.5 million. This is very good news for young people everywhere looking to kick-start their businesses. And the age limit for the sceme has been raised – from 24 years of age to 30, making the funds more widely accessible.
Tax breaks for social enterprises
Welcoming social enterprises as having “an important role in growing the economy, reforming public services and promoting social justice” the government will introduce a new social investment tax relief to encourage private investment in social enterprise. This is to complement the Governments other recent measures to help social enterprises get the capital they need, such as the launch in 2012 of Big Society Capital, and the Wayra Unltd Socia Venture Accelerator.
And finally… let’s have a pint.
1p cut on the price of a pint of beer! Celebrations all round.