From the top · 23 November 2016

Autumn Statement 2016: A 500-word summary for owners of micro and small businesses

Autumn Statement 2016
In his first Autumn Statement Philip Hammond announced it would be his last, as the update will be changed in 2017
For any small business owner who doesn’t have the time to sift through Autumn Statement 2016 story after story and page after page, we have a handy 500-word summary with everything you need to know.

£1bn broadband investment

Small businesses struggling with poor internet connections could soon be able to access a better connection after the chancellor announced an investment of more than 1bn into building out the UK’s digital infrastructure.
Wanting to make sure the UK is a world leader? in 5G internet, Hammond said the government would be pursuing improvements in speed, security and reliability. Additionally, 100 per cent business rate relief will be provided for the next five years when it comes to new fibre infrastructure.

National Living Wage increase

Employers with staff on the lowest legal wage will now have to pay more after Hammond revealed in the Autumn Statement 2016 that the National Living Wage, the replacement to the National Minimum Wage, will go up from 7.20 to 7.50 in April 2017.
Back at the turn of the millennium the National Minimum Wage was 3.60. However, the Labour and Conservative governments have taken steps to increase it with Labour planning for it to be 10 if the party comes back into power.
The tax-free personal allowance has also been increased, and will sit at 12, 500 by the end of the current parliament.

Increase to Export Finance funds

Small businesses looking to engage with export activities will soon have access to better financial assistance. UK Export Finance, an organisation with a mission to ensure that no viable UK export fails for lack of finance or insurance, is set to double in capacity.
This involves a double of total risk appetite? to 5bn, increasing capacity for support in individual markets by up to 100 per cent and making sure more currencies are pre-approved for UK Export Finance assistance.

VAT chances

The government is shutting down what it called inappropriate use? of the VAT flat rate scheme put in place to help small companies. The VAT flat rate scheme is an alternative way for small businesses to work out how much VAT to pay to HMRC each quarter.
Recently The Guardian revealed temp recruitment agencies were generating millions of pounds for participants by exploiting VAT rules that were originally designed to benefit very small businesses.
Instead, the government used the Autumn Statement 2016 to introduce a new 16.5 per cent rate from 1 April 2017 for businesses with limited costs, such as many labour-only businesses. This will, it added, help level the playing field? and maintain the accounting simplification for the small businesses that use the scheme as intended.

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ABOUT THE EXPERT

Hunter Ruthven was previously editor of Business Advice. He was also the editor of Real Business, the UK's most-read website for entrepreneurs and business leaders at the helm of growing SMEs.

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