How the Spring Budget 2024 affects small businesses

Corporation Tax. The main rate for Corporation Tax stays at 25% and the small profits rate at 19% stay in place. This will apply for the financial year beginning 1 April 2025. 

 

VAT. From 1 April 2024 the VAT registration threshold will go up from £85,000 to £90,000. The de-registration threshold also goes up from £83,000 to £88,000. 

 

Full expensing for leased assets. Full expensing and the 50% first-year allowance for special rate assets becomes permanent. Although currently excluded, there’s a planned consultation about spending on plant or machinery for leasing. 

 

Training. HMRC has published the new guidance on tax deductible training costs for sole traders and the self-employed. It’s intended to encourage people to update existing skills and keep pace with technology and changes in industry practices. 

 

Stamp Duty. Multiple Dwellings Relief ends on 1 June 2024 for people and businesses buying multiple properties in single or linked transactions. 

 

Furnished holiday lets. Tax relief on things like Capital Gains Tax for furnished holiday lets (FHLs) ends in April 2025. For tax purposes FHLs and long-term lets will then receive the same treatment. 

 

NICs for self-employed people. Self-employed National Insurance Contributions (NICs) went down to 8% in Autumn 2023. A further reduction to 6% comes onto effect from 6 April 2024. Employee NICs go down from 10% to 8%. You won’t have to pay weekly Class 2 NICs from 6 April 2024 and the government says it intends to abolish them. 

 

Non-dom taxation. From April 2025 new residence-based tax rules will apply for people who live outside the UK permanently (domiciled). UK residents who opt into the new scheme won’t pay UK tax on foreign income and gains for the first four years. After four years they will pay standard tax rates regardless of their domicile status. 

 

Child benefit. The threshold for the High Income Child Benefit Charge goes up from £50,000 to £60,000 from April 2024. Halving the chargeable rate means full withdrawal of the benefit only happens when taxable earnings reach £80,000 rather than £60,000. 

Recovery Loan Scheme. The original intention of the Recovery Loan Scheme was to support small businesses during the pandemic. It was due to end in June this year but will now continue. The renamed Growth Guarantee Scheme guarantees 70% of loans up to £2million for two years, until 2026. 

 

Fuel duty. The current 52.95p per litre fuel duty stays in place for a further 12 months. 

 

Creative businesses. Theatre Tax Relief becomes permanent at 40% for non-touring productions and 45% for touring and orchestral productions. Relief on business rates for film studios in England continues for 10 years. Tax credits will support independent audio-visual and film projects. 

 

Childcare businesses. Extra funding for parents’ free childcare in England will help 60,000 more parents to work over the next four years. 

 

Artificial intelligence (AI) skills. A £7.4million upskilling pilot fund will help small and medium-sized businesses develop AI skills.