After several significant changes to the corporation tax environment in recent Finance Acts, the Budget included several small detailed measures that have an impact on businesses.
A key element in the Government’s drive to support the economy is supporting research and development (R&D). This was demonstrated by a welcome 1% increase in the R&D expenditure tax credit rate to 12% and promise of £2.3bn additional funding. Measures were also promised to increase the awareness of the SME scheme relief and providing increased certainty for large scheme claims.
The importance of supporting scale-up businesses remains on the Government’s agenda with an Action Plan announced to unlock £20bn of investment. Scale-up supporting policies include a doubling of EIS and VCT scheme limits for investments in knowledge-intensive companies. The Government intends to target the reliefs at higher risk investments.
In a move to increase the tax base, a freezing of corporate indexation allowances from 1 January 2018 was announced. Forecast to raise an additional £1.7bn of tax over the next five years, this quiet move has a potentially significant impact on businesses disposing of property assets.
For our analysis on what the Autumn Budget means for individuals, visit our Private client area