Spring Statement 2022: key points for SMEs

Call 0345 872 6666

Spring Statement 2022: key points for SMEs

This year’s Spring Statement follows a period of rising living costs which have been felt by many across the country, and business owners are no exception. The ‘headline’ announcement that the National Insurance threshold will increase to £12,570 will of course benefit business owners (whether employed or self-employed), but there are a number of other key points from the Spring Statement that SME owners should be aware of.

Employment Allowance will be increased to allow eligible businesses to reduce their annual National Insurance liability by up to £5,000 (previously, the allowance allowed for a reduction up to £4,000).

For businesses who have significant expenditure on fuel costs, the reduction in fuel duty of 5p per litre will be especially welcomed. In real terms this will make the cost of filing up the average tank of petrol in the region of £91.87 and it has been estimated that over 12 months this will save the average van driver £200 and the average haulier £1,500. The reduction in fuel duty applies to both petrol and diesel and will take effect from 6pm on 23 March 2022.

Although specific reforms to R&D tax credits are not to be imminently implemented, the Spring Statement has paved the way for more generous R&D tax credits in the future. Draft legislation is due to be published this Summer and further details may be set out in the Autumn 2022 Budget.

Certain “green technology” (including heat pumps and solar panels) will be exempt from business rates from April 2022. Businesses supplying energy saving materials (ESMs) may indirectly benefit from the reduction in VAT on ESMs from 5% to 0%, if the reduction leads to increased demand for ESMs from homeowners.

Although no specific changes to the existing capital allowances regime have been set out, the government have announced a series of potential policy changes to the capital allowances regime, which will be considered in advance of April 2023.

At JMW, we are experienced in advising businesses and business owners on corporate and commercial matters. If you need assistance, please contact us to discuss how we may be able to help.

Did you find this post interesting? Share it on:

Related Posts