Get Your Share of Business Tax Relief

May12Confused about business tax relief?
Chancellor George Osborne made his vision for the UK clear in his budget last month; ‘to make the UK the best place for businesses to start and thrive’. Whilst it can be strongly argued that he has failed to realise this ambition in the opening stages of this year, he has to his credit presided over the introduction of a number of tax relief measures to try and assist small to medium sized businesses financially and encourage expansion. 

If you are a business director or company owner then it’s important that you are fully aware of the more relevant schemes and business tax relief available for you to access- or you could be at risk of unnecessarily struggling financially when there are a multitude of different measures available to you.

Use the Seed Enterprise Investment Scheme for investment capital relief

In a bid to try and raise business investment levels so that the countries businesses can expand, the government has designed the Seed Enterprise Investment Scheme, which has a number of things to offer to business owners across the country. The scheme was created in order to supplement the Enterprise Investment Scheme, and grants tax relief to investors who are placing their money into more risky businesses. Investors receive 50% tax relief and a deferral on their Capital Gains tax obligations for all of their early-stage business shares, which gives them all the incentive necessary to place their money into potentially high-risk businesses because it means they can receive up to 78% tax relief on their investment. Whilst this tax relief does not apply to your business directly, it can nevertheless be useful to encouraging other people to place extra money into your hands, which will undoubtedly have a positive effect on your company’s finances

It is also worth checking out the Department for Business Innovation and Skills online guide entitled ‘the great ambition guidance’, as it has some great advice about how to obtain debt and equity funding, as well as some other top tips to further the aims of your business. 

Use the Employment Allowance scheme

Many business owners have failed to capitalise on the benefits of the new Employment Allowance scheme which was fully implemented on the 6th of April. Under the scheme, businesses can receive £2,000 worth of credit against their NI costs in a move that the Treasury has forecasted will help almost half a million businesses financially and 33% of company owners pay absolutely nothing on NIC contributions at all. Essentially, the scheme grants relief to small companies that have less than 250 employees on their books, by lowering the amount they have to pay on their NIC contributions. The entire process for claiming is now being made more efficient by the HMRC, who are working collaboratively with payroll software suppliers in order to make the act of claiming possible through a simple click of a button.

You can also look at the grants and reliefs available from the government for simply offering a job to people aged 18-24 and have been on benefits for at least half a year. Certain schemes will enable you to acquire payments as high as £2,275 for employing younger people such as this.  

Check out your Local Enterprise Partnership and get a grant

Local Enterprise Partnerships are locally possessed partnerships between local authorities and companies and a lot will depend on where you live as to what you can claim. Establishing a working relationship with local authorities through the LEP is an excellent way to receive help with financial problems, upholding good practice and obtaining financial support through grants, financial advice and local funding. Each LEP is different in the way it supports a business but all have been set up with the improvement of the countries companies in mind and as such it is worth checking out your local LEP in order to see whether they can provide you with financial support and backing. To find out more, go to www.lepnetwork.org.uk.

Use the Small Business Rate Relief scheme

Small business owners were recently given a massive boost after it was revealed that the ongoing Small Business Rates Relief scheme has been extended for another year until April 2015. For all who are unfamiliar with the way the scheme works, it involves businesses receiving 100% rate relief from tax authorities if they have a company residence with a rateable value higher than £6,000. Considering that relief usually amounts to 50% in this area, this scheme can be hugely beneficial for  small business owner so it is most definitely worth looking into if you believe you qualify for the relief. The rate of the relief falls as the rateable value of the businesses property rises until it reaches £12,000, after which no relief is available. Recent figures have suggested that since its implementation, the scheme has helped over 350,000 SMEs across the country, so it is definitely worth looking into in order to improve your businesses financial situation in the future.

Research and development tax relief

One of the government’s more positive actions has been to reward businesses who are placing their money into research and development, so that the overall standard of the industry in Britain improves. A great measure that they have introduced to support this aim is the research and development tax relief which is available to almost all businesses that spend some degree of money on this area. The largest rate of relief possible from investing in research and development is a staggering 225%, clearly representing the merits of spending some of your company’s money in this area. You would also be surprised which areas of expenditure constitute ‘research and development’, so it is worth embarking on some form of research investment in order to obtain your own relief as soon as possible.

Image courtesy of ratch0013 / FreeDigitalPhotos.net

 

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