An Underwhelming Autumn Budget? How The Announcements Affect You

Google reviews
October 28, 2021
n

The Autumn Budget occurred on Wednesday 27th October 2021, and we have to admit, it was a rather underwhelming for small businesses and the self-employed. Most of Chancellor Rishi Sunak’s announcements weren’t specifically related to those working for themselves. However, there were a few interesting statements made, and it’s also important to note what hasn’t changed from the Budget back in March.


Join us as we dissect the most relevant points and detail all the facts you need to know.

The post-COVID economy

Inflation was at 3.1% in September, and it’s likely this will increase to a rate of 4% on average over the next year – as predicted by the Office for Budget Responsibility (OBR). 

It’s expected that the economy will bounce back to pre-COVID levels at the turn of the year, which is earlier than originally thought. Previously, this year’s growth was estimated at 4%. But now, the OBR is forecasting 6.5% growth for 2021, followed by 6% in 2022, 2.1% in 2023, 1.3% in 2024, and 1.6% in 2025.

What’s more, their long-term ‘scarring assumption’ from COVID has been reduced from 3% to 2%.

Business rates and taxes

Outside of the state of the economy, business rates will be retained and reformed. This includes a fresh 12-month relief so companies can invest in their premises. 

As fuel prices are currently at their highest level in eight years, the planned rise for fuel duty will also be cancelled. In turn, travel costs for the self-employed will be reduced. Not only that, regions like Greater Manchester, West Midlands and South Yorkshire will receive funding to support London-style transport developments.

What remains unchanged

That being said, a number of things weren’t touched upon – and this is because they’re staying the same. Personal allowance will be kept at £12,570, and the higher-rate tax threshold at £50,270, with both being frozen from April 2022 until 2026. 

Likewise, the rise in Corporation Tax is still due to go ahead – growing from 19% to 25% in April 2023, for businesses achieving a profit of at least £50,000.
There was no change to Capital Gains Tax either, which was welcome news to many who feared the government could potentially increase this. In addition, the 1.25% rise to divided tax rates from April 2022 will also remain in play. The basic rate will now be 8.75%, with the higher rate at 33.75%, and additional rate at 39.35%.

Support from Bright Ideas Accountancy

Whilst it wasn’t a budget aimed at the self-employed, some of the announcements still impact small businesses and those working for themselves. So, if you need help or advice relating to the budget, or a little support with the figures, then turn to Bright Ideas Accountancy.

Whether it’s guidance on financial planning, support with VAT returns and bookkeeping, or even assistance with compliance, you can rely on our years of expertise and experience.

icon paycheck

Resources

Recent Articles

Inheritance Tax at record levels, but Business Relief can help

Inheritance Tax at record levels, but Business Relief can help

Inheritance Tax (IHT) has reached a record level in the UK, with £7.5 billion flowing into Treasury coffers in 2023/24, up from £7.1 billion the previous tax year. One key reason for this growing tax take is rising property prices - the average house price in the UK...

Tipping Act Code of Practice to bring fairness to employees

Tipping Act Code of Practice to bring fairness to employees

Whenever you leave a tip in a restaurant or a hairdressing salon, for example, you would hope that the tip money you left will go directly to the person who provided you the service you are tipping for. But for many restaurants and other industries, that hasn’t always...

Everyone should check their tax code now

Everyone should check their tax code now

HMRC will provide new tax codes at the start of every new tax year if the Personal Allowance has changed, if someone has had a change of circumstances, including perhaps had a pay rise, and even to those who are taking their pensions for the first time. It’s important...

Ready to join us?

Whether you’re a contractor, freelancer, or small business, Bright Ideas can help remove the burden of time-consuming and complex finances. We’ll draw on our years of knowledge and experience earned helping sole traders just like you.

When you choose us, you’ll be assigned a dedicated Account Manager who’ll provide one-on-one support that’s customised to your business. Communication is key, so we’ll always answer your questions or requests as soon as we can. In fact, we offer a same-day response guarantee for emails and calls received before 3pm.

Contact us to get started

Give us a call us or send an email today!

Looking to switch accountants?
We make the transition simple.

Does your current accountant give 1-to-1 support? Are they fast and thorough?
Slap-dash services hold businesses back, so try our experts instead.

Move to an accountancy service that goes the extra mile…

Start the conversation

Let’s make your finances Brighter

Call us Monday to Friday 9am - 5pm

0161 669 4221

Request a call back