If you’re a tech founder, here’s the main highlights as the chancellor Philip Hammond makes his first and last Spring Budget, keep reading to learn more! For those who are worried about business rates, some good news, investment in R&D and disruptive tech is on the horizon but NICs are to increase for the self-employed and dividend allowance decreases to £2k in 2018.
Investment in disruptive tech
One of the biggest announcements made at the budget is Hammond’s commitment to invest £270m to put the UK at the forefront of disruptive technologies. This includes robotics, biotech and driverless vehicles. It is believed that both Robotics and AI are set to be a driving force in increasing productivity, and also solving societal and environmental challenges.
Broadband and 5G
Another biggie, the Chancellor made a spending commitment to invest £200m in support of local “full fibre” broadband network projects that are designed to bring in further private sector investment. He also announced an investment of £16m to create a 5G hub to trial forthcoming mobile data technology, with close attention on the government’s plans to better mobile network coverage across UK roads and railway lines.
The government plans to provide funds for 1000 new PhD and fellowship positions in Science, Technology, Engineering and Mathematics (STEM) subjects. A total of £90m is to be delivered from the investment fund towards the PhD places and another £160m for the offering of fellowships positions.
In plans to show the importance of digital skills, it was emphasized that the entire digital sector has a responsibility to develop both the current and future generation of the skills needed to drive the UK’s digital economy. Forget A-Levels, the Government plans to launch a new qualification for 16-19 year olds focused on more technical subjects called T (technical)-levels.
Administrative changes will be made to improve the R&D tax credits system and there will be state aid approval sought to extend High-end TV, animation and video games tax reliefs beyond 2018.
Business Rates – relief for some!
The current revaluation is going ahead however the government says that it will look at reform of future revaluation metrics.
Any business coming out of small business rate relief will have its rate increases capped to £50 per month and Local Authorities are to be given a discretionary fund to assist businesses adversely affected by revaluation.
Making Tax Digital
The start date for unincorporated businesses and landlords with turnover below the VAT registration threshold will be deferred until April 2019.
The dividend allowance will reduce from £5,000 to £2,000 from April 2018.
Class 4 NICs will increase from 9% to 10% from 6 April 2018, and 11% from 6 April 2019.
There you go then! In summary while cash and investments will be welcomed, it’s largely following money that has already invested in these areas and represents little change in direction for a Government that loves headlines about robotics and driverless cars, and taking this all into account, some of changes made above will simply squeeze entrepreneur’s pockets on a day-to-day basis in the face of some uncertain times ahead. We’ll find out more in the Chancellors next budget, fingers crossed for that!