Government Budget Announcement 2020 – The UK government’s budget announcement is an opportunity to make significant “public spending” changes. But in addition to personal finances, the budget will also affect business interests. Sajid Javid said the budget announcement is bound to “open a new chapter for the economy”. This statement is fitting. Considering that this budget announcement is the first in over 40 years where the UK is no longer an EU state.
Although there are no major changes expected, there are still some predicted announcements that could affect business and personal finances.
What will happen to Entrepreneur’s Relief and Capital Gains Tax?
The Tory party featured a review of both Entrepreneur’s Relief and Capital Gains Tax. For many businesses, paying 10% less Capital Gains Tax has significant benefits. Thus, its abolishment is not something that companies are likely looking forward to.
CGT is a means of taxing the wealthy. It is possible to see a CGT rate increase especially concerning Labour voters who shifted their allegiance to the Conservative party. It is therefore in the best interest of businesses to take advantage of current gains and annual exemptions, well- ahead of the announcement.
Off-payroll employees and workers
Another aspect of the budget which is highly likely to change impacts freelancers or off-payroll workers. There have been many changes to the governing rules- both for workers that offer professional service and those working for the private and public sectors. And with the upcoming budget announcement, these rules are potentially subject to further reviews.
Freelancers need to keep abreast of the changes and how this will impact your finances, especially your taxes. For companies that regularly employ off-payroll workers, the same should also apply. Nevertheless, even if the landscape for off-payroll workers is changing, changes are not likely going to be drastic.
One of the main focus of government spending this coming financial year will be in infrastructure. Perhaps what triggered this assumption is the chancellor’s statement of the new budget announcement on the site of the £350m Manchester tram extension. The pre-election Tory manifest also included significant ramping up of capital spending. Hence signalling the possibility of more funds allotted for country-wide infrastructure projects.
Javid announced a reform in treasury rules that will enable more investment in the northern and Midland regions. The new rules create new targets that will further improve the wellbeing of citizens.
The possible increase in infrastructure spending and regional investment both have a positive impact on businesses. While ER and CGT are likely to get reviewed and reformed, these predictions about the upcoming budget announcement have much in store when it comes to business finance opportunities – CBHC Accountants