Spring Budget 2024 – Business taxes


The annual VAT taxable turnover threshold at which a business is required to register for VAT will increase from £85,000 to £90,000 from 1 April 2024. Also from that date, a business may deregister for VAT if its annual VAT taxable turnover falls below £88,000, rather than the current threshold of £83,000.

‘Full expensing’ for capital allowances

It had previously been announced at the Autumn Statement that ‘full expensing’ for capital allowances (i.e. a full deduction against taxable profits being claimed for certain plant and equipment acquisitions in the year of expenditure) would be made permanent, as would the 50% first-year allowance for ‘special rate’ assets.

Currently, expenditure on plant and machinery for leasing is ineligible for full expensing, but the Budget announced a technical consultation with a view to considering possibly extending full expensing relief to include such assets, at a point when it is affordable to do so.

Freeports – ‘sunset’ date extension

Businesses operating in certain designated ‘freeport’ sites are able to enjoy a number of special tax breaks (subject to eligibility), including enhanced capital allowances, structures and buildings allowance, business rates relief, employer national insurance contributions relief and a stamp duty land tax relief. These reliefs were originally due to be available for a five-year period; the Budget now extends this to 10 years, which means that they will now be available up to 30 September 2031.

Investment zones

A programme of investment zones was launched in last year’s Spring Budget. Today’s Budget announced further details of six investment zones, namely: Greater Manchester, Liverpool City Region, North East of England, South Yorkshire, West Midlands and Tees Valley.

These investment zones will offer various tax reliefs (subject to eligibility criteria) including enhanced capital allowances, enhanced structures and buildings allowance, business rates relief, employer’s national insurance relief and stamp duty land tax relief between their designation and 30 September 2034.

As well as covering these tax reliefs, the funding envelope made available to the investment zones will also facilitate other interventions including skills, research and innovation, and infrastructure.

For more Spring Budget 2024 news, click here.

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