HLAS

The Government has announced two changes to the tax advantaged Company Share Option Plan (CSOP) scheme. There is currently a maximum employee share option limit based on market value at grant of £30,000. This will be increased to £60,000 for any new options granted from 6 April 2023. Existing options are unaffected by this change. There will also be increased flexibility for share options granted from 6 April 2023 due to a removal of conditions around the class of shares used. The CSOP scheme is available to most UK trading companies as, unlike the Enterprise Management Incentives (EMI) share scheme, [...]

The new Chancellor has given his support to the tax-advantaged Enterprise Investment Scheme (EIS) and Venture Capital Trusts (VCT) and said he sees the value of extending them in the future. The vision is for the UK to be an entrepreneurial, share-owning democracy. In relation to the Seed Enterprise Investment Scheme (SEIS), the Treasury have confirmed that they are widening the criteria and will be allowing companies to raise £250,000 under the scheme, 66% more funding than previously. The SEIS currently provides unconnected investors with an income tax deduction of 50% of the amount invested, up to £100,000 a year. There [...]

The Government is in discussion with 38 local authority areas in England to set up ‘Investment Zones’ in specific sites within their area. Each Investment Zone (IZ) will offer generous, targeted and time limited tax cuts for businesses along with liberalised planning rules to release more land for housing and commercial development. These will be hubs for growth, encouraging investment in new shopping centres, restaurants, apartments and offices, and creating thriving new communities. The tax incentives under consideration are: 100% Business Rates Relief- on newly occupied or expanded business premises in IZs. 100% first year allowance - for companies with [...]

Businesses investing in plant and machinery will welcome the decision to make the £1 million Annual Investment Allowance (AIA) permanent. This has been extended several times and was scheduled to revert to just £200,000 from April 2023. Unlike the super-deduction, the AIA is available to unincorporated businesses as well as limited companies and the equipment does not have to be new.  

In the March 2021 Budget, Rishi Sunak announced that the rate of corporation tax would increase to 25% from 1 April 2023 where a company’s profits exceeded £250,000 a year, with the current 19% rate continuing to apply where profits were no more than £50,000 a year. There was also scheduled to be an effective 26.5% rate on profits between £50,000 and £250,000 a year. The UK would still have had a very competitive rate compared to other major trading countries as many of those are also increasing corporate tax rates. Nevertheless, the planned increase will not now go ahead [...]

Many director/shareholders of family companies pay themselves a small salary and take the rest of their “pay” in dividends. With dividends being free of NIC, this would have allowed them to avoid the extra 1.25% NIC charge when it was originally introduced. Consequently, the Government added 1.25% to the dividend income tax rates for 2022/23. Although the NIC increase is being abolished from 6 November 2022, the additional 1.25% will continue to be applied to dividends paid throughout 2022/23. From 2023/24 the dividend income tax rate will however revert to 7.5% where dividends fall within an individual's basic rate band [...]

It was on 7 September 2021 that we first heard about a new 1.25% Health and Social Care Levy, imposed on employers, employees and the self-employed, coming in from 2023/24. Further, this was to be effectively accelerated into 2022/23 by a 1.25 percentage point rise in National Insurance contributions (NICs). As expected, and despite changes to thresholds earlier this year, the increased NIC rates have resulted in a reduction in take home pay for many individuals. The Health and Social Care Levy has now been abolished and will not come in next April. Further, the Government is removing the associated [...]

The law states that every business must have a policy for managing health and safety. A health and safety policy sets out your general approach to health and safety. It explains how you, as an employer, will manage health and safety in your business and should clearly state who does what, when and how. If you have five or more employees, you must write your policy down. If you have fewer than five employees, you do not have to write anything down, but it is useful to do so. You must share the policy, and any changes to it, with [...]

The Information Commissioner’s Office (ICO) has a useful webpage with advice and guidance for all small organisations, including SMEs, small businesses, sole traders, small charities, groups and clubs, and small start-ups. The webpage includes a run-through of data protection and bite-sized advice on how to build trust and save money through stronger data protection compliance. Topics include: Getting started with data protection; Key data protection terms you need to know; Compliance checks; How to respond to a personal data breach; and How to deal with data protection complaints. See:  SME web hub – advice for all small organisations | ICO

The ultimate aim of every serious business person is to build a company that has value, so that it can be sold or transferred, allowing the entrepreneur to exit gracefully and profitably. Recently, we have been helping a number of our entrepreneur clients develop exit strategies. There are many factors to consider: When do you want to retire? Can the business be sold to your employees? Is a trade sale more likely? Are there children involved? How much is the business worth? What needs to be done to enhance the value of the business? How long will it take? Do [...]