Without getting into the political arguments about what will or won’t happen, we would simply suggest to have some sort of plan in place in case tax does rise considerably to pay for the current COVID grants and support available to people. So what adjustments and planning can you implement if we assume that business taxes will increase?
Will Corporation Tax Rise?
It is believed by some that cooperation tax, for one example will rise from the 19% it is currently to as high as 24%. This of course is a considerable increase. One thing to keep in mind is that, usually, any increase in cooperation tax isn’t likely to take place until its announcement, which we estimate would be around Autumn time. That would mean it is unlikely to be implemented until the 1st April 2021 or after.
Will Income Tax Rise?
An increase in Income Tax is a fair amount less likely. However if there are any changes to income tax implemented it is unlikely that there will be any great change. Rather, we expect that you may need to accept small changes to tax allowances and National Insurance contributions. Please remember and bear in mind also that the rates and changes will be made based on which region of the country your business is in so there may be a slight variation throughout the UK.
Have a Plan
We would strongly suggest that whilst having a plan in place in case of these increases is a good idea, we would stress that now is not the time to implement your plans, unless you have good reason to already do so. We would also suggest that you don’t spend too much time away from the main running of your business to concentrate on planning for something that may not happen.
We Can Help
Rest assured that we will do our utmost to help you through these uncertain times and make sure that we try our best to keep your business an unaffected as possible.
If you’d like further advice about this subject then please don’t hesitate to get in touch where we will be able to discuss this with you based on your individual business needs.