Budget 2020: What does it mean for small business?
We’ve pulled together the headlines that affect the self-employed, sole traders and small business from this week’s Budget.
“Better news for small business as budget tackles Coronavirus fears head on”
It wasn’t a surprise that Coronavirus dominated the 2020 Budget. Chancellor Rishi Sunak announced wide ranging emergency measures to combat the expected economic effects as the UK rapidly moves into a ‘delay’ phase.
What does that mean for you?
Help is on the way for millions of self-employed workers and small businesses owners in the form of grace and favour grants, loans, flexible payment options, sick pay, and exemptions from business rates. These measures are designed to help small businesses cope more easily with cashflow problems if their trading slows or their staff are sick.
Undoubtedly, the coming weeks and months are going to be an anxious time for sole traders, limited companies, retailers and gig workers as well as anyone in need of welfare support if work dries up.
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How the 2020 Budget boost helps small businesses
- Statutory sick pay is now available if you’re self employed and have to self-isolate. Sick notes can be emailed to you when you contact NHS 111. No need to see a doctor. And you can do so from day one. You used to have to wait until day 8 for Contributory employment and support allowance (ESA)
- £2bn of sick-pay money is to be made available for small businesses with fewer than 250 employees up to a ceiling of £2m per employer.
- Small firms will be able to access "business interruption" loans of up to £1.2m with the government promising to back up to 80% of losses.
- Entrepreneurs' Relief has survived but in a heavily curtailed form. The lifetime allowance will be reduced from £10m to £1m.
- Your company may be eligible for small business rates relief in the form of a £3,000 cash grant – a £2bn injection for 700,000 small businesses.
- Do you use your own van or vehicle for work? Fuel duty is frozen for a year. Fuel Duty is included in the price you pay for petrol, diesel and other fuels used in vehicles or for heating.
- The government is scrapping business rates for small shops. Other businesses such as bed and breakfasts, gyms and leisure centres (below a value of £51,000) will pay no business rates whatsoever for the rest of the year, saving approx £21,000.
- Publishers will welcome the decision to make electronic publications zero-rated for VAT.
- From April 2021, only electric and other zero-emission cars will qualify for first-year allowances and cars with emissions over 50 g/km qualifying for writing down allowances of just 6% a year.
- Smaller businesses will be pleased with the increase in the NIC employment allowance to £4,000.
- Legislation guaranteeing access to cash from ATMs is to be brought forward. An expected move following the closure of 1,200 bank branches and cash machines over the last two years, it follows the lead taken by a number of other countries in protecting access to cash. Although, it’s a decision that works against predictions that the UK will be virtually cashless by the end of this decade. The recent Amaiz survey of UK small businesses found that 15% can only take payment by cash, but over half of have lost custom because they couldn’t take an alternative payment method. We’ll be keeping a close watch on the conversations around cashless society. But on the back of the survey we’re offering a launch discount to Amaiz account owners who want the option of easy and mobile card payments. Head to https://sumup.co.uk/amaiz/ to find out more.
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