Yorkshire businesses shouldn’t fear the Chancellor’s 2013 announcements. Neither should they be celebrating.
In April 2015, there is some help for employers: Employers’ NIC is to be abolished for employees under 21. For those who believe in employee share ownership from next April there are small increases in the amounts employees may invest in both the Share Incentive Plan and the Save As You Earn scheme. Coupled with the already announced £2,000 NIC employment allowance and three new incentives aimed at indirect employee share ownership these measures are to be welcomed.
The proposed changes to the tax treatment of loans made by companies to their shareholders and directors have been postponed. So the 25% tax charge where the loan is still outstanding after the year end remains.
Affecting anyone operating using a partnership or Limited Liability Partnership, changes are coming in April 2014 which will mean many previously “self-employed” partners may find themselves back on the payroll, with the associated increases in NIC charges. Also aimed at partnerships and LLP’s from 5 December anti-avoidance measures are now targeting those with both corporate and individual members. Where profits were previously taxed on the corporate member (typically at much lower rates than the individuals suffered) if certain criteria are met, those profits are now taxed on the individuals.
In a similar vein, with an expected increase in tax revenue of some £400m new rules will target employment intermediaries which are being used to disguise employment as self-employment.
Osborne also announced measures to help small businesses with business rates. Retail, food and drink businesses with a rateable value of up to £50,000 could receive up to £1,000 off their rates for 2 years; any business moving into premises which have been empty for at least 12 months will only pay half business rates on that premises for 18 months; option to pay rates in 12 rather than 10 instalments; the double Small Business Rate Relief will continue for another 12 months to April 2015. It is expected this could benefit in excess of half a million small businesses.
Finally, good news for heavy road users; the expected fuel duty increase has been cancelled.
The tendency for successive governments announcing the “good” well in advance continues. The last date for the next general election is May 2015. Who knows what the next government will look like and how many of the trumpeted changes will actually become reality?
For further information please contact Steve Vickers, Tax Partner at Hart Shaw on T: 0114 251 8850 or email: steve.vickers@hartshaw.co.uk.
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