How the Spring Budget 2017 affects you

Editor's Notes

The first (and last) Spring Budget statement from Philip Hammond was both refreshing and had the slight smell of familiarity to it. There were no major announcements made and with the possibility of another bite of the Budget cherry in the Autumn, together with Brexit looming in the shadows, the lack of any unexpected changes will undoubtedly be welcomed by many.

In line with our mission statement of being the best all-round advisers to owner-managers we have waded through the Budget report to pick out the areas of importance to you and your business.

Where necessary, we have included details of announcements from previous Budgets and Autumn Statements to highlight the changes that will most affect you and your business in the coming months.

Overview

This Budget was almost what we have come to expect from the recent Autumn Statements, and perhaps is a sign of things to come with the future Spring Statements. No huge sweeping announcements and a distinct focus on investment in innovation, technology and training…plus a mention of International Women’s Day and a number of investments into associated commemorations and charities.

‘Spreadsheet Phil’ (a reputation that he even alluded to during his speech) seemed to quite enjoy his moment in the spotlight, perhaps well aware that this was to be a Budget highlighting the better than expected state of the economy in the first Budget since the Brexit vote.

He may also have been spurred on by the fact that a number of previous announcements (mainly by his predecessor, George Osborne) are due to become effective from this April. Given the need for stability in the British economy at the moment, he may have felt that any further announcements would only have an effect of rocking the finely balanced economic boat.

As many of the changes coming into effect shortly have been previously announced, you may have a sense of déjà vu reading some of the material within this newsletter, although please do make sure that you act on anything that may affect you or your business.

Issues Affecting Owner-Managed Businesses

  • Optimal drawing strategies for owner-managers
  • Dividend allowance reduced
  • Class 4 National Insurance increase
  • Making Tax Digital
  • National Living Wage
  • VAT Flat Rate Scheme – Limited Cost Traders
  • Public Sector Off Payroll Reform
  • Review of employment practices
  • Infrastructure and Training Investments and Opportunities
  • Research and Development Relief
  • Business Rates Reform
  • Corporation Tax Rates

Read in further depth about the effect on Owner Managed Businesses

Other Announcements and New Legislation

  • Restricting tax relief for Buy to Let landlords
  • Tax-Free Childcare vs. Childcare Vouchers
  • Changes to the taxation of non-domiciled individuals
  • Lifetime ISA
  • Pension Recycling
  • Launch of New Investment Bond
  • Micro-entrepreneur’s reliefs
  • Changes to Duty and Insurance Premium Tax (IPT)

Read in further depth about the other announcements from the 2017 Spring Budget

Reaction to the Chancellor's Speech

‘As we start our negotiations to exit the European Union, this Budget takes forward our plan to prepare Britain for a brighter future.’

Philip Hammond, Chancellor of the Exchequer

 

‘The chancellor did give us plenty of information today but with no more than a kind of glib reference to being 'match-fit' at the beginning and a bit of deflection, very little actually on the elephant in the room which is Brexit. It's not as if the Treasury don't know what the consequences will be.’

Stewart Hosie – SNP Economic Spokesman

 

‘Our members are pleased with the confirmation of plans to remove £6.7bn from the business rates system, and the decision to make rural rate relief fairer for small firms, but there will need to be stronger fiscal interventions to boost the economy next year, with the prospect of weaker longer-term growth looming.’

Mike Cherry – Chairman, Federation of Small Businesses

 

‘Philip Hammond has delivered a responsible, solid and focused package that will reassure both business and markets.’

Dr Adam Marshall - Director-General, British Chambers of Commerce 

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