Pre-Budget Report: Important Points

Of most interest to the small business sector are the following:

1. The proposal to introduce a loan guarantee scheme, which should go some way to relieve the strangulation of capital many face as banks remain reluctant to borrow. This will provide up to £40 billion to small and medium-sized companies;
2. A further £1 billion to be made available via a Business Finance Partnership to invest in smaller businesses;
3. The offering of 50 per cent Income Tax (IT) on investment in new enterprises. The high rate of tax relief will apply regardless of the rate at which the investor pays IT. Furthermore, capital gains realised in 2012/13 and used for seed capital investment will be exempt from capital gains tax;
4. 100 per cent capital allowances will be available in defined areas which face particular economic challenges.