Chancellor Jeremy Hunt’s Spring Budget, presented on 6 March, was crucial not just in its timing — given the looming general election — but also in its content, especially concerning financial strategies for businesses and personal savings.
Here’s an essential breakdown of the announcements relevant to you and your business, along with advice on leveraging these changes for optimal benefits.
Business-focused measures
The Chancellor introduced several initiatives aimed at bolstering SMEs and stimulating high-growth sectors like manufacturing, creative industries, and life sciences.
Despite a more subdued focus than in the Autumn Statement, these measures represent a strong commitment to supporting the backbone of the UK economy — its small and medium-sized enterprises.
VAT registration threshold lifted
In a move to alleviate the administrative load on SMEs, the threshold for VAT registration is set to rise from £85,000 to £90,000 starting from 1 April 2024. This is great news for approximately 28,000 SMEs, potentially freeing many from the intricacies of VAT, fostering investment, and encouraging growth.
Growth Guarantee Scheme
A key feature is the Growth Guarantee Scheme, an evolution of the recovery loan scheme designed to facilitate easier access to vital finance for SMEs. This is a significant opportunity for business expansion and innovation.
Building on the recovery loan scheme, the new Growth Guarantee Scheme is tailored to support SMEs in accessing crucial finance, marking a positive step forward for business growth.
Savings and investment incentives
The Budget also introduced new avenues to enhance personal financial growth. The launch of a new UK ISA allows an additional £5,000 annual investment in UK equities, completely tax-free. This is an excellent chance to bolster your investment portfolio.
Moreover, the introduction of British Savings Bonds, offering a guaranteed rate for three years, presents a secure investment opportunity, particularly appealing in the current volatile market.
Modernising the non-dom tax regime
The refresh of the non-dom tax regime, which exempts new UK residents from tax on foreign income for their first four years, is designed not only to enhance the UK’s appeal as a global investment hub but also to generate significant revenue, projected at £2.7 billion a year by 2028/29.
Advice and strategy
It’s imperative to stay informed about these changes and adjust your financial and business strategies accordingly. For businesses, exploring the new Growth Guarantee Scheme could provide the necessary capital to fuel expansion. Additionally, reevaluating your VAT strategies in light of the new threshold could offer operational advantages.
For personal finances, consider how the new UK ISA and British Savings Bonds can fit into your broader investment strategy to maximise returns while managing risk.
Get help
At Bulley Davey, we are here to guide you through these updates. Understanding these adjustments in the context of your specific financial landscape is crucial.
Reach out to discuss how you can make the most of these opportunities. Let’s strategise together to ensure your business and personal finances are positioned for success in this evolving economic environment.
Get in touch for support navigating the changes.