Small Business Rate Relief

The Government has announced it will extend the doubling of Small Business Rate Relief for a further year from 1 April 2016. It is also undertaking a review of business rates, due to be reported at Budget 2016.

Business investment relief

The Government will consult on how to change the business investment relief rules to encourage greater use of the relief to increase investment in UK businesses.

Apprentices

As previously announced, the Government will introduce an apprenticeship levy in April 2017. It will be set at a rate of 0.5% of an employer’s wage bill and will be paid through PAYE. Each employer will receive an allowance of £15,000 to offset against their levy payment. This means that the levy will only be paid on any wage bill in excess of £3m.

The Government will also establish a new employer-led body to set apprenticeship standards and ensure quality. The body will be independent of Government and will also advise on the level of levy funding each apprenticeship should receive.

Diesel company cars

The three percentage point differential between diesel cars and petrol cars was set to be removed in April 2016. However, it will now be retained until April 2021, when EU-wide testing procedures will ensure new diesel cars meet air quality standards even under strict real world driving conditions.

Employment intermediaries

As confirmed in this year’s second Budget in July, the Government will legislate to restrict tax relief for travel and subsistence expenses for workers engaged through an employment intermediary, such as an umbrella company or a personal service company. Following consultation, relief will be restricted for individuals working through personal service companies where the intermediaries legislation applies. This change will take effect from 6 April 2016.

Charitable close company loans to participators

Legislation will be introduced in Finance Bill 2016 to ensure that a tax charge is not applied to loans or advances made by close companies to charity trustees for charitable purposes. This will apply to qualifying loans or advances made on or after 25 November 2015.

Venture capital schemes

With effect from 30 November 2015, the provision of reserve energy generating capacity and the generation of renewable energy benefiting from other government support by community energy organisations will no longer be qualifying activities for the Enterprise Investment Scheme (EIS), Venture Capital Trusts (VCTs) and Seed Enterprise Investment Scheme (SEIS).

In addition, these activities will not be eligible for Social Investment Tax Relief (SITR) when SITR is enlarged. The Government will exclude all remaining energy generation activities from the schemes from 6 April 2016, as well as from the enlarged SITR. Increased flexibility will also be introduced for replacement capital within EIS and VCTs, subject to state aids approval.

Averaging period for farmers

Following consultation, the averaging period for self-employed farmers will be extended from two years to five years as of April 2016, with farmers having the option of either averaging period.