5 Ways to Help Your Business Thrive in 2022: Support & Reliefs
Whether you’re a small or medium size UK business looking for ways to invest, grow or save money, it may be worth knowing these five key means of government support out there today, in their varying forms.
Up to £5k Employment Allowance
Employment Allowance is a tax relief that allows eligible businesses to reduce their National Insurance contributions yearly and claiming as a business is possible when employer Class 1 National Insurance liabilities were less than £100k in the previous tax year. That’s a new tax cut worth up to £1,000 for nearly half a million SMEs, comprising around 30% of all businesses today. This will see 50,000 businesses taken out of paying NICs and the Health and Social Care Levy entirely.
Up to £5,000 per SME to invest in IT / Skills
Help to Grow: Digital is a UK-wide government-backed scheme that aims to help you choose, buy and adopt digital technologies that will help you grow your business. Eligible businesses can receive a 50% discount on buying new software worth up to £5,000 per SME, alongside free impartial advice and guidance about what digital technology is best suited to boost your business performance.
The Help to Grow: Management scheme provides small businesses with access to world-class business expertise on everything from leadership and financial management to marketing and digital adoption. This is delivered through leading UK business schools, alongside one-on-one support from a business mentor – and is 90% funded by the government.
By the end of the programme, you will develop a business growth plan to help you lead and grow your business. You need to be a UK-based SME, actively trading for at least one year and have a total of 5 -249 employees.
Up to half off your business rates
From April this year, small retail, hospitality, and leisure businesses can benefit from 50% off their business rate bills. This is worth £1.7bn for up to 400k eligible properties. The business rates multiplier has also been frozen for another year, saving businesses £4.6bn over the next 5 years. This is used to calculate how much business rates they should pay, and it usually rises with inflation each year.
The business rates multiplier for 2022 to 2023 are 49.9p for the small business multiplier and 51.2p for the standard multiplier. From April 2022 there will be no business rates due on a range of green technology, including solar panels and batteries, while eligible heat networks will also receive 100% relief. Together these will save businesses around £200m over the next 5 years.
Super Deduction & Annual Investment Allowance
To spur business investment, the super deduction allows companies to cut their tax bill by 25 pence for every £1 they invest in any qualifying machinery and equipment. This can include purchase of computers, most commercial vehicles, and office furniture.
The temporary £1m limit for the Annual Investment Allowance has also been extended to end of March 2023. It was due to revert to £200,000 at the start of 2022. The Annual Investment Allowance allows businesses to spend up to £1 million on qualifying business equipment and deduct in-year its full cost before they calculate taxable profits. Both tax breaks remain available for firms to take advantage of until the end of March 2023, by incurring qualifying expenditure before then.
Support for high energy use businesses
High energy usage businesses, such as steel and paper manufacturers, are set to receive further support for electricity costs as the UK government has confirmed details of the Energy Intensive Industries (EII) compensation scheme. The scheme will be extended for a further 3 years and its budget will be more than doubled.
The scheme provides businesses with relief for costs of the UK Emissions Trading Scheme (ETS) and Carbon Price Support mechanism in their electricity bills, recognising that UK industrial electricity prices are higher than those of other countries. The scheme will now also provide support for companies that manufacture batteries for electric vehicles.
For help accessing tax reliefs and support schemes please don’t hesitate to contact our team. There are also some links below. Let’s Talk.