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Although very little specifically was mentioned about independent retailers in the budget, it was a big budget with lots of different changes that will affect retailers and their businesses.
As an industry, retailers spend a lot of money on plant and machinery, so you will be pleased to know that the Annual Investment Allowance scheduled to drop to £25,000 will be maintained at £200,000 for the rest of the parliament.
For those of you that are limited companies, the government is reducing the main rate of corporation tax to 19% in 2017 and 18% in 2020. This will be somewhat, if not entirely, negated by the changes to the taxation of dividends, as the government is effectively increasing the tax rate on dividends to 7.5% for basic rate taxpayers and 32.5% for higher rate taxpayers.
Lastly, for those of you looking to purchase other trades, the government is abolishing the tax relief on purchased goodwill so you won’t get tax relief until you sell the trade.
The government is introducing a national living wage to replace the national minimum wage, so that by April 2020 all over 25’s will be earning at least £9 per hour, this will be phased in from April 2016 with a starting wage of £7.20 per hour.
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