BUDGET 2016: Beneficial for Your Small Business Clients (and You)
There's reason to celebrate for small business owners and their accountants, as George Osborne reveals the 2016 budget
George Osborne’s 2016 Budget has been disclosed, and it paves the way for you to begin introducing vital advisory services to your clients.
The national response to the budget on the whole has been, shall we say, mixed, but in the midst of the hoopla surrounding taxes on sugary drinks and ‘psychologically damaging’ tunnels through the Peak District, one particular group has come away relatively unscathed: small businesses.
Indeed, by taking a closer look it becomes apparent that small business owners have much to be pleased about (assuming they’re not perennial Coca-Cola drinkers), with many of the most welcome announcements relating to micro- and small-entities.
Here are some of the key takeaways:
· Business rates for properties with a rateable value of £15,000 or less have been scrapped, permanently; this more than doubles the current threshold of £6,000
· From 2020, rates will be linked to the CPI (Consumer Price Index) rather than the current RPI (Retail Price Index), a move predicted to save in excess of £1.6bn over the next five years
· Government plans to “radically simplify” rate administration are in place, in a move to modernise processes
· 90% of small businesses will benefit from lower stamp duty on commercial property, with property worth up to £150,000 being exempt, a 2% rate on property valued between £150,001 and £250,000, and a 5% rate on those valued at £250,001 and above
· Corporation tax is to be cut to 17% by April 2020, a significant reduction on the 28% it stood at when the Conservative Party first returned to power
· Two new tax-free allowances (each worth £1,000 per year) will be introduced for ‘micro entrepreneurs’ who rent their homes, Airbnb-style, and sell services through the internet
A considerable swathe of benefits, I’m sure you’ll agree, leaving us with the £64m question:
How does this affect you?
The fallout from the Budget will see a minimum of 600,000 small- and micro-sized companies benefitting financially. With the light from these positive announcements radiating throughout the small business world, now’s an opportune time to begin flexing your business advisory muscles.
Helping, supporting and nurturing small businesses towards success and expansion - in an age where entrepreneurship and self-employment are at their highest ever levels - has become an interesting and profitable necessity for accountants harnessing the right technologies. Potential specialisms to consider include:
- Company set-up services
- VAT registration
- Tax guidance
- Financial forecasting
- Funding advice
However, your first steps should be to explore the business case for your practice and learn how to successfully approach these services through careful understanding and implementation.
Your small business clients are expecting to be advised. Start by consulting our expert guide, highlighting key considerations and 4 reasons why introducing advisory services makes sound business sense.