Brexit Britain: Are Corporate Tax Cuts Enough for SMEs?

Lee Murphy, owner of accountancy software Pandle, says:

“As corporate tax is set to drop on April 1st from 20% to 19%, the lowest rate in the G20, change is coming to the UK market. In addition to this, SMEs and micro businesses have been targeted with changes to the flat rate scheme, the increase in Class 4 National Insurance rate from 9% to 10% in 2018 and public sector dependency on clients for IR35 status. While not all of these changes will be coming into effect as of April 1st, Brexit shouldn’t be the only consideration for UK SMEs who are planning for the future.”

“The corporate tax change coming in this weekend will be a nice bonus for SMEs. Less tax paid means more future profit for companies and while setting up a business will remain as simple as in the past, I believe this reduction in tax will incentivise people looking start a company. Businesses can take advantage of this change by spending on upcoming expenditure now to offset against a higher corporation tax rate.”

“The UK will continue to be one of the most desirable places in the world to set up a company. Low tax rates, favourable business legislation and the strongest financial district in the world all make for a very attractive place for a company to settle or expand. I wouldn’t go so far as to say the UK will become the new Panama, but this tax reduction will definitely attract new foreign investors.”