With only 3 months left until the end of the 2017/18 tax year, it is essential to look ahead to the next financial year.
Unlike previous years, 6 April 2018 will not herald any significant changes to how your business is taxed.
Nevertheless, all business owners should be thinking about what the tax rates, rules and reliefs will mean for their balance sheets over the next 12 months.
Corporation tax
The corporation tax rate will remain at 19% for 2018/19.
There has been a single rate of corporation tax since 2015 when the main rate was reduced to the same level as the small profits rate.
Business rates
The retail prices index (RPI) rate of inflation will no longer be used to determine business rates from 1 April 2018.
Inflation as measured by the consumer price index (CPI) is lower than the RPI due to the way it’s calculated.
The switch from RPI to CPI will therefore reduce future increases in business rates.
The measure was originally due to be introduced in 2020, but chancellor Philip Hammond announced in Autumn Budget 2017 that the government would bring the changes forward.
VAT
The VAT registration threshold will remain at £85,000 and the de-registration threshold will stay at £83,000 for the next tax year.
These thresholds will be frozen for 2 years while the government holds consultations on the future of the registration threshold.
National living wage
The national living wage (NLW) will increase from £7.50 to £7.83 for over-25s from 6 April 2018.
Employers that have workers paid at the current NLW rate will need to prepare and budget for the increased wage costs they will face in the next financial year.
Get in touch
Our experienced team of accountants and business advisers will provide you with the assistance and expertise you need to minimise your tax bill.
Contact us on 01628 631 056 or email tracya@knightandcompany.co.uk to find out more about our tax planning services for businesses.