Good News on ‘Full Expensing’, Business Rates Relief and R&D: Autumn Statement Update

Our Policy Advisor, Şenay Camgöz has been analysing the Chancellor’s Autumn Statement…

As some members will already be aware, the “full expensing” capital allowance allows companies to deduct spending on new machinery and equipment from profits, allowing companies to write off the cost of investment in one go. It was introduced as a temporary measure in the 2023 Spring Budget (for 1 April 2023 to 31 March 2026), was made permanent by the Chancellor at this year’s Autumn Statement. Please contact us if you are already making use of this capital allowance as are keen to understand its impact.

There was also promising news on research and development (R&D) with the government committing to a review of public investment in R&D spending for the creative industries. This is welcome because the creative industries are currently ineligible for R&D tax relief. 

We were pleased to learn that the 75% business rate discount (AKA Business Rates Relief) for retail, hospitality, and leisure has been extended for another year. All theatres are eligible for the relief, which will last until 31^st March 2025 and local authorities will automatically apply the discount to the business rates bills they send out. Local authorities are responsible for decisions on the award of relief, based on the property and their interpretation of the guidance, which will be published in early 2024. Please contact your local authority directly if you have any questions regarding this.

As a result of the government’s decision to accept the Low Pay Commission recommendations on The National Living Wage, the following changes are expected from 1st April 2024:

• The National Living Wage should increase by 9.8% from £10.42 to £11.44 an hour, with the age threshold lowered from 23 to 21 years old. 
• The rate for 18-20-year-olds should increase by 14.8% from £7.49 to £8.60 an hour. 
• The rate for 16 to 17-year-olds and the Apprentice rate should both increase by 21.2% from £5.28 to £6.40 an hour. 
• The accommodation offset will increase from the current rate of £9.10 to £9. 

Also of note, the main rate of Class 1 employee National Insurance contributions (NICs) will be cut from 12% to 10% from 6 January 2024, with employees benefitting from January onwards. Read the government’s updated factsheet on this.

Last but by no means least, members operating bars and restaurants will be interested to note that all alcohol duty is frozen until 1st August 2024 .

For questions regarding this summary email us.  

Read the full Autumn Statement.