Briefing members of the Wealden Business Group on the Chancellor’s latest Budget, David Meredith, senior partner at Tenterden accountants Busbys, described the current changes in taxation as “one of the most significant for small businesses in recent years.”
In short, SMEs and the self-employed would face more bureaucracy and bigger tax bills. The key reasons…
- A extra 7.5% tax on dividends above £5,000 pa, particularly affecting SME owners who take most of their income in dividend payments;
- A rise to 16.5% in the Flat Rate VAT scheme for many consultants, ..
- Quarterly filing of accounts under HMRC’s ‘Making Tax Digital’ regime, although final details have yet to be announced, and…
- The proposal to levy higher NI charges on the self-employed might have been reversed, but not in all cases – for instance, the increase in the basic rate tax band also increases NI for higher earners.
However, there was some brighter news…
- Some traders will benefit from lower business rates;
- Corporation tax is still going down from the current 20% to 19%, and will reduce still further to 17% by 2020; and…
- VAT and personal tax thresholds have all been increased.
The precise impact of the Budget will depend on an individual’s business performance and personal circumstances.
But David warned: “Get your 2017 tax returns done as soon as you can. Tax bills payable next January are likely to come as a bit of a shock!”
For further information, email david.meredith@busbys.co.uk, tel: 01580 765088, website www.busbys.co.uk
