30 Oct 2018 Budget – Businesses
Whilst there was no immediate change to the current corporation tax rate of 19% there was confirmation of the intention to reduce the rate to 17% from 1 April 2020. Something to look forward to!
For those businesses with significant investment in plant and machinery planned for the next couple of years, there was welcome news with the increase in the Annual Investment Allowance (AIA) to £1m for the two calendar years 2019 and 2020. It might therefore be worth considering delaying some expenditure to the New Year in order to qualify for AIA where your expenditure in 2018 already exceeds the present £200,000 limit.
Do you remember Industrial Buildings Allowances? These were phased out in the late noughties but it seems they have made a come back in the form of a new Structures & Buildings Allowance (SBA) which is introduced at a WDA rate of 2% on new non-residential buildings. This applies not only industrial buildings but also offices and farm buildings. It starts for all construction contracts entered into on or after budget day and is also available to commercial property landlords.
On the down side From April 2019 the plant and machinery that qualifies for special rate allowances will receive relief at 6% rather than 8% currently. This also applies to integral features of buildings.
Finally, for this blog at least, the £3,000 per year employment allowance will in future only apply to those employers with a NIC bill of less than £100,000 in the previous tax year.
Click here to see our full budget report.
For more detail on the contents of the budget click here.