How the 2023 UK Budget Affects Your Business

This month Jeremy Hunt unveiled the UK’s Spring Budget 2023.

Here we have highlighted areas of the budget prevalent to businesses in the Manufacturing, Engineering, Product Development and Research sectors.

As always, for guidance specific to your individual circumstances, always seek expert independent advice.

Capital Allowances

The temporary 130% super-deduction is due to expire on 31 March 2023, however, changes to capital allowances taking effect from 1 April 2023 were announced in the Budget.

“Full Expensing” will be introduced allowing 100% of the cost of qualifying plant and machinery to be deducted upfront for tax purposes, rather than over the period of use.

In addition, it was confirmed that the previous temporary increase in the Annual Investment Allowance to £1m p.a. will now become a permanent increase going forwards. As such, investment in design and manufacturing will continue to receive considerable tax benefits.

Where can I find out more?

Head to the government’s 2023 Spring budget factsheet.

Investment Zones

In the Budget it was announced that 12 Investment Zones will be created across the UK. These will be centred around universities and research institutes in order to increase investment and growth in the green industries, digital technologies, life sciences, creative industries and advanced manufacturing sectors.

Grant funding will be available to businesses in these Investment Zones, and they will also benefit from a number of reliefs, including:

• Full Business Rates relief
• Accelerated enhanced Structures and Buildings Allowances
• Secondary Class 1 NIC relief for eligible employees
• Full Stamp Duty Land Tax relief for commercial land and buildings

If your business is looking to take advantage of these Investment Zones then you may benefit from being able to participate in our Entrepreneur programme.

Where can I find out more?

See page 16 of the UK government’s Investment Zones Policy Offer for more details.

R&D Relief

There have been some small changes to the previously announced changes to the R&D SME relief, specifically in relation to loss-making businesses.

Whereas under the previously announced changes, these businesses would have seen a significant reduction in their R&D claims, some changes have now been made that will mean these businesses will now be less impacted by the changes.

If you are involved in R&D then you may be eligible to participate in our Entrepreneur programme.

Where can I find out more?

Head to the government’s 2023 Spring budget factsheet.

If in doubt, seek expert advice

Whilst we have noted some items above that may be of relevance, this will depend on the specific circumstances of each individual business and therefore we would suggest that you seek independent advice in relation to these topics.