Wednesday, November 30, 2011

Flash Update: Autumn Statement

On 29th November 2011, the Chancellor of the Exchequer, George Osborne, announced the Autumn Statement which provides an update on the Government's plans for the economy.

Here is a summary of the key changes impacting small businesses...

Businesses in need of finance
Government to back £20 billion of small business loans under the National Loan Guarantee Scheme. The Scheme will lower the cost of bank loans for smaller businesses with turnover of up to £50 million. Ministers hope the Scheme will be live by the start of 2012 and it is envisaged it will run for the next two years. The Scheme should deliver up to a one percentage point reduction in the cost of a business loan.

Trades people
Under the New Build Indemnity Scheme, the government hopes to increase the supply of affordable mortgages. The government and house builders will provide security for the mortgages and home buyers will only require a five per cent deposit in order to purchase a new build house or flat The Scheme should help 100,000 families and young people to buy their own home.

Mobile businesses
The fuel duty increase of 3.02 pence per litre that was due to take effect on 1 January 2012 will no longer occur. Furthermore, the increase planned for 1 August 2012 of 5 pence per litre will now only be 3 pence.

Small businesses that employ staff
Unfair dismissal - The qualifying period for unfair dismissal claims will increase from one year to two years from April 2012. The Government will also be considering how the dismissal process could become simpler, quicker and clearer.

Work experience - All unemployed 18 to 24 year olds will be offered work experience or a Sector Based Work Academy place after three months on Job Seekers' Allowance.

Incentives - The Government will provide an estimated 160,000 wage incentives of £2,275 each to entice employers to recruit young people.

Small businesses operating from premises
The Small Business Rates Relief holiday will be extended by six months from 1 October 2012.

Small business owners with a family
Child and Disability - Tax Credits The child element of the Child Tax Credit and disability elements of tax credits will be uprated in line with the Consumer Price Index in 2012/13. This should mean that the child element of the Child Tax Credit will increase by £135 but the Government will not be going ahead with the planned £110 above-inflation increase.

Working Tax Credits - The couple and lone parent elements of the Working Tax Credit will
not be uprated in 2012/13.

You can also download this summary in PDF format or to find out more, contact us today for a no obligation, free initial consultation on 020 33971520

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