How will Autumn Budget affect small business owners?

There are encouraging messages in the Budget for technology and innovation companies. Specific points are:

  • R&D Expenditure Credit Scheme (RDEC) taxable credit will increase to 12% from 11%.
  • Promise to double the EIS investment limit (currently £1m) for investors on knowledge incentive companies.
  • £2.3bn more government investment on R&D. This could mean more funding for technology start-ups.
  • £500m for AI and 5G initiatives.


Business rate. Slightly good news. The rate increase will be linked to CPI (currently to RPI. RPI is higher)


VAT registration threshold remains same at £85,000.


Key points on income tax:

  • Personal tax allowance will increase to £11,850 (current year £11,500) from April, 2018
  • Higher tax rate threshold will increase to £46,350 (current year £45,000) from April, 2018

That means if you are a higher rate tax payer, you could see a £550 deduction in your tax bill. Unfortunately, this deduction will be offset by reduced dividend allowance (from £5,000 to £2,000) if you are an owner director of your company.


Stamp duty. Good news for first time buyers – the first £300,000 of a house of up to £500,000 is exempt from stamp duty. This represents up to £5,000 saving in stamp duty. This does not apply to houses with price above £500,000.