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Finance | Jun 9

What’s changing for small businesses in the 2023/24 tax year?  

Finance | Jun 9

Here’s a quick rundown of the changes that may affect your business in the new tax year. 

Reading Time 2 minutes

Changes that came into effect on 1 April 2023 

  • The Corporation Tax rate for profits over £50,000 rose to 25%. Limited companies with profits between £50,000 and £250,000 became eligible for Marginal Relief, which will reduce the company’s tax bill. Use HMRC’s calculator to estimate how much marginal relief your company can claim. 
  • The Energy Bill Relief Scheme was replaced by the Energy Bills Discount Scheme. Under the new scheme, prices for businesses will no longer be capped. Instead, businesses will receive a per-unit discount on their prices when these rise above £302/MWh for electricity and £107/MWh for gas.  
  • The super-deduction capital allowance was replaced by full expensing. Limited companies may be able to claim 100% of the cost of qualifying equipment against their taxable profits. Special rate expenses on assets that don’t qualify for full expensing may still be claimed at 50%.   
  • The Annual Investment Allowance for all businesses was permanently set at £1m. 
  • Research and development (R&D) relief will be extended. The changes mean that loss-making small businesses with R&D costs of at least 40% of their total expenditure will be able to claim credit of £27 for every £100 they spend on R&D.  

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Two leaders or senior managers from a business with 10 to 249 employees can now attend the 12 modules of learning and get the benefits of one-to-one mentorship.  

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