Liverpool Accountants Andrew Keates Explain How To Make The Most Out Of George Osborne’s July Budget Announcements. Few businesses know the pain of small business taxes as well as we do. We have been working with small businesses across Liverpool for over a decade and know from experience that far too often tax changes are bad changes!
But July’s budget announcement came with a small sweetener for any micro-business owner that is sick of hearing the latest way for their profit margins to be squeezed. From April 2016 the government will scrap its current dividend tax credit and will replace it with a new tax-free dividend allowance of £5,000 a year.
However as good as this sounds for micro businesses, it may not be good for larger businesses. These changes will inevitably lead to small UK businesses paying 7bn more a year in taxes. Because with this tax break also comes a tax rate increase, only the 1st £5,000 a year will be tax-free! At the moment small business owners have the option of paying themselves dividend income at 30.6% tax rate. From next year this will increase to 38%. But capital gains tax is currently 28% and will not change next year! This places enormous pressure on Liverpool businesses to sell up and to benefit from the capital gains tax.
So can you make this tax change work in your favour and make sure that you keep more of your hard earned cash and give less away to the government? Well as top Liverpool Accountants of course we have the answer and we are happy to help, it’s important to know there isn’t one simple solution as no one businesses is the same so to get the answer that is right for your business call us on 0151 277 5353 for a now obligation chat with one of our tax advisors.