What the 2016 budget means for SME businesses
Update: further to the 2017 Autumn Budget, we produced a post looking at the impact on property and homebuilders, tax efficient investing (specifically the EIS), and Angel investors.
Yesterday, chancellor George Osbourne delivered his 2016 Budget. You may have heard about the proposed sugar tax, which had chef Jamie Oliver performing a celebratory dance, live on the BBC news:
But what does the Budget mean for UK entrepreneurs and SME businesses? We've rounded up some articles which look into how small and medium-sized business owners will be affected.
Business rates shakeup to benefit small businesses
In what is fantastic news for new and SME business owners, Osborne announced that around 600,000 small businesses will be taken out of business rates from 2017, saving them £6,000 a year.
According to research carried out by leading accounting and payroll software company Sage, more than a third of the UK's small business owners say that a change in business rates would have the biggest impact in terms of transforming their company.
Osborne extends entrepreneur's relief
The chancellor confirmed that entrepreneurs’ tax relief will be extended to long term investors in unlisted companies, meaning that entrepreneurs will be able to access a 10% rate of CGT (capital gains tax) on newly-issued shares.
This Budget continues to lower taxes, with new support for small business and entrepreneurs, while also modernising the tax system and taking steps to ensure that taxes are fair and are paid.
Budget judged ‘solid’ for small businesses and entrepreneurs
The chancellor's claim that he wanted to help "light the fires of entrepreneurship" saw him deliver a Budget that experts said would provide help to small business owners and entrepreneurs, with the promise of tax rate cuts going down particularly well.
(Photo credit: Mike Moore. Appears in The Mirror.)
But what's missing? Is there more that the chancellor could be doing for SME businesses?
Here are 10 things small business owners want from Osborne
There are a number of factors that go into growing a successful SME business. The proposed actions outlined in the 2016 Budget have great potential, but some small business owners would like to see more.
- Faster broadband
Given the nature of our business, better broadband and improved mobile network access are key areas of us. For businesses in 2016, ultra-fast broadband is a necessity and should no longer be considered a luxury.
- A Northern Powerhouse plan “with substance”
My aspirations regarding the upcoming budget would be for the government to offer greater support for new and smaller firms in the North.
There’s currently very little, if anything, which could be directly linked to government policy to support or encourage new businesses in our region. While I expect the chancellor will draw on the Northern Powerhouse, this is unlikely to actually bear much substance since, with the possible exception of Leeds and Sheffield which attract occasional support due to the allegedly forthcoming HS2 link to London, the government does very little to support Yorkshire small and medium enterprises.
- James Turner, managing director of Turner Little
Startups.co.uk gathered responses from a number of UK entrepreneurs and small business owners to find out their thoughts.
- "Yes" to the extension of Entrepreneurs Relief
It is an exciting time for British high growth small businesses – we have great people, a supportive community, access to funding and plenty of innovative ideas, making this an incredibly fertile place to grow outstanding businesses. With this in mind, UK entrepreneurs will welcome the chancellor recognising this ambition and entrepreneurial appetite, rewarding those who choose to sell their business by […] extending Entrepreneur’s Relief.
- Alex Macpherson, head of Octopus Ventures
- "No" to the exclusion of small business funding in the budget
I was disappointed to see that the fundamental issue of access to basic banking services was not discussed. This is a severe problem and it is worrying that it wasn’t addressed by Osborne. Whilst it is promising to see that business rates were discussed to help those small and medium enterprises already up and running, the government need to help the UK’s small businesses that are held back from even reaching this stage.
- Rich Wagner, CEO and founder of Advanced Payment Solutions
Are you a the owner of an SME business? How do you think yesterday's news will affect you? Share your thoughts by leaving us a comment below.