As reported by Marketing Stockport, starting from April 1, 2024, an uplifted VAT threshold of £90,000 aims to exempt 28,000 small businesses from VAT payments, aligning with the government’s support for small enterprises
The £5,000 increase in the threshold was announced in the Spring Budget and puts the UK’s VAT threshold at the joint highest level of any OECD nation.
The change also comes alongside the fourth consecutive freeze in the small business multiplier for business rates. The measure is part of the £4.3 billion business rates support package announced at the 2023 Autumn Statement that includes the 12-month extension of the 75% relief for 230,000 Retail, Hospitality and Leisure (RHL) properties, also coming into force from 1st April.
Exchequer Secretary to the Treasury, Gareth Davies, said:
“We’re rewarding work and backing Britain’s small businesses – the lifeblood of the economy and beating heart of communities – with support on VAT and business rates.
“Combined with our decisive action to reduce inflation from over 11% to 3.4%, these measures will help ensure the local, independent businesses that many of us cherish most will continue to thrive and help our economy grow.”
Welcoming the extra support for small businesses, Tina McKenzie, Policy Chair, Federation of Small Businesses (FSB), said:
“This is a big day for small businesses. FSB has campaigned for decisive action to increase the VAT threshold, freeze business rates, and extend the retail, hospitality, and leisure discount and we’re pleased to these come in today.
“April 6 will also mean a cut in National Insurance for the self-employed – the Government is right to take forward practical, impactful measures that help small businesses drive growth in all of our local communities.“
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