How Does The Autumn Statement Affect Your Business?

The Chancellor, George Osborne, announced his Autumn Statement on Thursday 5 December 2013. The Autumn Statement provides an update on the government’s plans for the economy based on the latest forecasts from the Office for Budget Responsibility (OBR). We have summarised some of the main announcements affecting Northern Ireland businesses.

Growth

Growth forecast for the UK economy for the next few years:

  • 1.4% in 2013
  • 2.4% in 2014
  • 2.2% in 2015
  • 2.6% in 2016
  • 2.7% in 2017
  • 2.7% in 2018

Employment

  • The OBR expects total market sector employment to rise by 3.1 million between the start of 2011 and the start of 2019.
  • Government borrowing and debt

Borrowing set to fall and is due to be less than forecast at the previous Budget announcement:

  • £111 billion in 2013-14
  • £96 billion in 2014-15
  • £79 billion in 2015-16
  • £51 billion in 2016-17
  • £23 billion in 2017-18

From 11% in 2010, the underlying deficit is due to fall to 6.8% this year – instead of the 7.5% forecasted in March.

Local government

  • As the Barnett formula is also applied to spending by the UK government at departmental level, each of the Devolved Administrations will benefit from additional funding to allocate according to their own priorities. As a result, each of the Devolved Administrations will see a net increase to their budget over the next 2 years.

Income tax

  • The personal allowance will rise to £10,000 from April 2014.
  • Allow married couples and civil partners to transfer £1,000 of their personal allowance to their spouse – worth up to £200 in 2015-16 to benefiting eligible couples.
  • The government will introduce more measures to tackle tax avoidance, evasion, fraud and error.

Business finance

  • Export finance capacity available to support businesses doubled to £50 billion.
  • Non-residents to pay Capital Gains Tax on UK property sales from April 2014.
  • Bank levy to rise to 0.156% from January 2014.
  • An additional £160 million boost to the Start Up Loans scheme over six years.
  • £2,000 Employment Allowance to help businesses, especially small businesses, to expand by reducing the cost of employment from April 2014.

Pensions

  • Pensions and jobseeker benefits excluded from welfare spending cap.
  • Basic state pension to rise by a further £2.95 a week from April 2014.
  • The government will introduce a scheme to allow current pensioners, and those who reach State Pension age before the introduction of the new single tier pension, an option to top up their Additional State Pension record through a new class of voluntary National Insurance contributions. The scheme will be introduced in October 2015 and will be time limited.
  • State pension age to rise to 68 in mid 2030s and 69 in late 2040s.

Energy

  • Tax allowances to encourage investment in shale gas in the UK.

Apprentices

  • The government will put business at the centre of the apprenticeship system by enabling employers to receive funding for the training costs of apprentices directly through an HM Revenue & Customs-led system and ensuring that employers contribute.

Business taxes

  • Stamp duty on shares purchased in exchange traded funds abolished.
  • Tax relief on investment in social enterprises introduced from April 2014.
  • For businesses employing someone under the age of 21 National Insurance contributions will be removed from April 2015.
  • There were also a number of business rates announcements, however these are not applicable in Northern Ireland. For details of business rates as well as rate relief for Northern Ireland businesses see nibusinessinfo’s section on business rates.

Fuel duty

  • The September 2014 fuel duty rise will be cancelled.

Read full details of the Autumn Statement on the gov.uk website.

Source: nibusinessinfo.co.uk