Tax cut up to £1,000 for half a million small businesses

As of the 6th April 2022, nearly 500,000 small UK businesses will now be supported by a tax cut worth up to £1,000.

The tax cut which was announced by the Chancellor Rishi Sunak in his Spring Statement has taken effect. This includes:

• An increase in Employment Allowance from £4,000 to £5,000, which will benefit approximately 450,000 (30% of) businesses. Meaning small businesses can claim up to £5,000 off their employer National Insurance Contributions bills
• This will increase the number of companies not paying the Health and Social Care Levy to 670,000.

The Chancellor said that this tax cut will help businesses to thrive and grow to help drive the UK's economic recovery. This increase is the third time that the government has increased the Employment Allowance since its introduction in 2014.

Of the half a million businesses benefitting from the increase, 94% are small and micro.

Industries which will see the highest number of employers benefitting are:

• Wholesale and retail sector (87,000)
• Professional, scientific & technical activities (63,000)
• Construction sector (52,000)

The government are also offering a number of other measures to assist with business growth.

Article by GOV.UK