Pain in the budget but focus on small firms and enterprise welcomed

SMALL businesses look set to be among the biggest winners in a budget that delivered more pain than pleasure for the vast majority of people, according to Clive Owen & Co LLP.

Nicola Bellerby, tax partner in the Durham office of accountants and business advisers Clive Owen & Co LLP, said: “This was a Budget to get Britain working and the Chancellor was clear that everyone will share the pain. However, George Osborne clearly recognises that that the UK economy is built on a backbone of small businesses and his measures to encourage them to thrive, not just survive, will be tremendously important over the coming years.

“There were some measures – such as the VAT increase – which will discourage the smallest businesses from expanding and creating jobs but this will be outweighed by other benefits flagged up in the Budget.

“In particular, the Chancellor’s decision to introduce regional National Insurance exemption on companies employing fewer than 10 people will encourage employers to take on more staff. Not only will it give immediate tax relief on new jobs, it will also stimulate longer term job creation in the smallest companies. Additionally, it should prompt people who are thinking about setting up in business to take the leap.”

Miss Bellerby added: “Mr Osborne particularly recognised the role of the entrepreneur by raising the threshold for 10% Capital Gains Tax from £2m to £5m. This is a confidence boost for the dynamos in the economy who excel in creating and growing enterprises which can then be sold on. By lifting the 10% tax ceiling it gives them breathing space to grow bigger and better businesses without fear that they will be hammered by the Treasury. This is vital if the UK economy is to grow more quickly.”

Clive Owen & Co LLP also has offices in Darlington and York.

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