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Autumn Budget Nov 2022 For Small Businesses

Autumn statement, budget, oh please no not again. Call it what you wish, there’s been another one. It seems less likely that there will be mind changing on this one, but who knows.

This is my quick run down of the facts as they currently stand, I’d like some of the details to change for the sake of small businesses but sadly that seems unlikely!

Capital gains allowance is being slashed. If you were pondering selling shares or second homes or whatnot make sure you make the most of your CGT allowance for this year. You currently get an allowance of £12,300 this is going down to £6,000 from April 2023 and to £3,000 from April 2024.

The Upper rate tax band threshold will be lowered from £150,000 to £125,140 from 6th April 2023 meaning you’ll be paying tax at 45% from £125,140 if you earn lots of money.

Dividend allowance is being slashed. Sorry small business owners, you’re getting battered a bit more. The dividend allowance is being reduced from £2,000 to £1,000 in April 2023, then to £500 in April 2024. Thankfully the dividend tax rate won’t be increased which is a small mercy, but it also wont be reduced, its staying at 8.75%. Yay.

Corporation tax is also still going up if your profits are over £50k a year. If your profits are over £250k you’ll be paying corporation tax at 25%. It will be staggered between those amounts, but we don’t actually know those details yet, naturally. It might be more tax efficient to close down the limited co and go back to the sole trader life. Give us a couple of weeks and we’ll create you a calculator to check.

National minimum wage is increasing to £10.42 p/h from April. Awesome for employees. Might not be awesome for employers and budgets. We can help if you’re worried about your cash flow and affording this by doing some budget and cashflow modelling with you.

From April 1st 2023 business rates will be reevaluated to take account of a rise in property values since 2017. If you have a business premises this could mean yet more bad news for how much you’re having to pay out.

I know its not dreamy reading, especially for small businesses, but we all knew we’d have to pay back the covid chaos somehow. And sadly the people taking the brunt of paying it back are mostly the people that got naff all benefit from it.

Next steps? Give us a couple of weeks to do some excel wizardry and we shall create a calculator so you can compare your options. You’ll need to also be thinking about increased wages costs, increased tax bills and business rates and everything being more expensive in general. Do you need to raise prices? Now’s the time to start thinking and making plans.

As always, if you need us we are here!

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