Small Business rates cut!
The big headline announcement in this years budget is the cut to business rates by the extension of the small business rates relief scheme. Currently the scheme means that all properties with a rateable value of < £6,000 don’t pay anything and those < £12,000 get a sliding scale reduction. Under the new scheme, there will be no rates to pay for all property < £12,000, then tapered relief for properties up to £15,000. Furthermore, the threshold for the small business multiplier has been increased from £18,000 to £51,000, which will give a modest saving to larger SMEs.
Under the previous stamp duty regime, if you purchased a commercial property for £1 over the key thresholds of £250,000 or £500,000 then you paid a higher rate on the entire price. Mr Osbourne has now brought this into line with the residential rates to iron out the massive hikes in tax you can see on the graph below.
To give an example, if you were to purchase a commercial property for £270,000 under the old rules you would pay £8,100 and under the new rules you would pay £3,000.