Small businesses will receive a boost as the VAT registration threshold has been raised to £90,000 from £85,000, which would free 28,000 businesses from paying the tax.
This is part of chancellor Jeremy Hunt's host of incentives announced during his spring budget that came into effect from April 1.
The other measures include a freeze on rates for small businesses for the fourth consecutive year, which will protect over a million ratepayers from a 6.6 per cent increase in their bills.
The measure is part of the £4.3 billion business rates support package announced in the Autumn Statement.
It will also include a 12-month extension of the 75 per cent relief for 230,000 retail, hospitality, and leisure properties.
Exchequer Secretary to the Treasury Gareth Davies on Monday (1) visited the Chai Guys business in London alongside Enterprise Nation, a small business support network, to discuss how these changes will benefit businesses.
Davies said these measures will reward and support Britain’s small businesses. “Combined with our action to reduce inflation from over 11 per cent to 3.4 per cent, these measures will help ensure the local, independent businesses will continue to thrive and help our economy grow.”
Welcoming the incentives, Enterprise Nation’s Head of Policy & Government Relations, Daniel Woolf said, "Freezing business rates for the fourth year running offers some stability for over a million small property owners."
The discount for retail, hospitality, and leisure firms will benefit 230,000 businesses. "The 10-year rates relief for film studios shows the creative sector is being prioritised," he added.
As part of the £1 billion package of tax reliefs for the creative sector announced at Spring Budget, film studios across England will receive 40 per cent relief on gross business rates bills until 2034.
This £470 million tax cut will ensure the UK remains an attractive place for film and TV companies.
This is alongside the transformational UK Independent Film Tax Credit (IFTC), designed to boost the production of UK independent films and support UK talent in films. Under the IFTC, eligible films will be able to claim an enhanced credit, at a rate of 53 per cent, on their qualifying expenditure.
The tax cuts for small businesses form part of the government’s ‘Help to Grow’ initiative to make 2024 the year of the SME, including providing swift access to finance.
The British Business Bank has already delivered £1 billion of loans to over 100,000 businesses, and UK Export Finance has provided £6.5 billion of support to help SMEs export around the world.
