UK Budget 2015
- Corporation tax rate falling from 20% to 18% by 2020
- Banks compelled to refer declined customers to alternative finance providers and share information
- Government-backed Business Bank to facilitate up to $20bn of finance by 2019
- $400k annual investment allowance
- Enterprise Zones
1. Access to finance - free up alternative finance
The UK's major lenders will soon be required to share the financial information that they keep on small business to give these companies the best chance of securing loans.
The Government plans to force the banks to share their SME credit information with other lenders and to offer to share the details of SMEs rejected for a loan with online platforms that can match them to alternative finance providers.
The British Business Bank has also been tasked with "increasing and diversifying" the supply of finance available to SMEs. The Bank will facilitate up to £10bn of finance by 2019, according to new forecasts.
2. Drive small business investment - long term not short term
The Annual Investment Allowance allows small-to-medium-sized firms to make tax-deductible investments in equipment, plant, and machinery, encouraging businesses to invest in future productivity and growth.
The allowance is currently set at £500,000 but was due to reduce to £25,000 from January 1, 2016. Mr Osborne has set the new allowance at £200,000, which could potentially add £1bn to GDP by 2020.
Small business organisations have been calling for an increase to the £500,000 allowance, so the £200,000 will be a disappointing figure to many.
The response from Earl Yardley, director at Industrial Vision Systems, a supplier of machine vision solutions to industry, has been more pragmatic.
"The Chancellor should be applauded for fixing the annual investment allowance at £200,000," he said. "We have already seen a significant increase in investment made in our new automated production lines and cells across the UK manufacturing base.
"By establishing a long term rate, this is sure to boost productivity and help leverage the UK at the forefront of the global manufacturing sector.”
3. Create new enterprise zones
Mr Osborne announced the creation of new enterprise zones - areas where small firms pay reduced taxes and receive business support - to help create more start-ups and stimulate growth in the small business sector.