22 November, 2023
2023 Autumn Statement: What this means for business
The 2023 Autumn Statement brings significant changes that benefit Hoxton Mix customers, particularly those who are self-employed or run small and medium-sized enterprises (SMEs). Here's an expanded look at the key aspects:
Self-Employment Tax Reforms: The abolition of Class 2 National Insurance and the reduction of Class 4 National Insurance will enhance the financial health of self-employed professionals. These changes provide direct savings, allowing for reinvestment or improved cash flow.
We have partnered with Osome and Ember to offer tailored accounting. As a Hoxton Mix customer, you can enjoy exclusive offers, such as up to £100 off on custom accounting packages from Osome, and a three-month free trial of Ember's Automated Accounting Solution. These partnerships are designed to streamline financial management for our self-employed and limited company clients, allowing them to take advantage of the latest tax reforms and concentrate on scaling their businesses.
Business Rates Relief for Small Businesses: The extension of a 75% discount on business rates and the freezing of the small business multiplier for retail, hospitality, and leisure businesses offer substantial financial relief. This could mean significant annual savings for eligible businesses, freeing up funds for other operational needs or growth initiatives.
With a London virtual office, you pay no business rates, no rent, and no utility bills, offering substantial financial savings. This is especially beneficial in the UK, where the Standard Multiplier for business rates is a whopping 51.2% of the property's rateable value, making it one of the highest in the world.
This means that a business paying £10,000 per month in rent or mortgage might also be paying approximately £5,120 per month in business rates.
Full Expensing for Business Investments: This incentive encourages businesses to invest more in their growth. For instance, for every £100,000 invested, a business can now deduct £25,000 from their tax bill in the same year. This measure boosts business investment and productivity, leading to long-term growth and higher profits.
As a Hoxton Mix customer, you have the opportunity to take advantage of our partnership with Funding Circle. Our collaboration provides you with access to business loans ranging from £10,000 to £500,000, with fixed rates and flexible terms that are ideal for financing essential investments such as technology or office equipment. Furthermore, Funding Circle's FlexiPay offers a flexible line of credit that is perfect for a range of business expenses. As an exclusive benefit for Hoxton Mix customers, you can enjoy a 0.5% cashback on your loan, which can enhance your investment capacity while taking full advantage of the full expensing tax benefits.
Enhanced Support for R&D Intensive SMEs
For our innovative customers engaged in Research & Development, there's good news. The government is now offering enhanced support for R&D intensive SMEs. If your business is loss-making and R&D expenditure constitutes a significant portion of your total expenditure, you might be eligible for a higher rate of payable tax credit. Starting from 1 April 2023, this measure could greatly benefit those who invest heavily in R&D, underpinning our commitment to fostering innovation and growth among our SME community.
To further support our clients in leveraging these benefits, we're thrilled to introduce our new partnership with Counting King, a leading name in R&D Tax Practices. Exclusively for Hoxton Mix customers, we're offering a 10% discount on R&D claim fees with Counting King. This is an excellent opportunity for our SME clients to enhance their R&D tax reliefs and propel their innovative projects.
Support for Small Businesses: The government's focus on small businesses extends to addressing issues like late payments and providing relief on business rates. These measures aim to create a more supportive environment for small businesses to thrive.
These initiatives are aimed at creating a more favourable business environment for Hoxton Mix customers. They help to reduce financial burdens and promote growth and investment. Apart from these measures taken by the government, Hoxton Mix customers can also take advantage of the Hoxton Mix Marketplace, which offers a range of tools and services specifically designed for small businesses and self-employed individuals. To learn more about these opportunities and explore them further, please visit the Hoxton Mix Marketplace.
What is Full Expensing for Business Investments?
Full expensing is a tax policy that allows businesses to deduct the full cost of certain investments in new or improved technology, equipment, or buildings from their tax bill. This policy is now permanent and incentivises companies to invest more, which leads to increased productivity, higher wages, and more job opportunities. According to the estimates, this policy is expected to raise GDP by 0.9%, investment by 1.5%, and wages by 0.8%.
How Does Full Expensing Benefit Small Businesses?
Small businesses can immediately deduct 100% of their machinery investment costs from their tax bill, improving cash flow and enabling reinvestment in growth.
What are Business Rates?
Business rates are taxes paid by businesses that occupy non-residential properties such as offices, shops, pubs, and warehouses. The amount of tax paid is determined by the property's "rateable value". The 2023 Autumn Statement outlines measures aimed at helping small businesses, including the freezing of the small business multiplier and extending discounts on business rates. These measures can significantly reduce the tax burden on small businesses.
What is National Insurance Contribution Class 2 and 4?
Self-employed individuals in the UK are required to pay National Insurance contributions to be eligible for state pension and other benefits. There are two types of National Insurance: Class 2 and Class 4. Class 2 is a flat-rate tax that is paid by self-employed individuals earning above a certain threshold, while Class 4 is a percentage tax on profits within certain thresholds.