Page 16 - Budget Newsletter November 2022

Other than that, there were no changes to capital allowances, although Mr Sunak, as
Chancellor, had consulted on a range of potential reforms in summer 2022 ahead of the end
of the 130% super-deduction on 31 March 2023.

Previous announcements remaining in force

The Annual Investment Allowance, which has long oscillated at the whim of Chancellors,
was fixed permanently at its current £1 million level by Mr Kwarteng. It had been due to fall
to £200,000 from 1 April 2023.

Research & Development (R&D) tax reliefs

A radical overhaul R&D tax reliefs will take effect from 1 April 2023. The Research and
Development Expenditure Credit (RDEC) rate will increase from 13% to 20%, the small and
medium-sized enterprises (SME) additional deduction will decrease from 130% to 86%,
and the SME credit rate will decrease from 14.5% to 10%.

Value Added Tax

The threshold for value added tax registration, which was fixed at £85,000 in April 2017
and was due to rise in April 2024 will now remain frozen for another two years, until April
2026.

Business rates

1 April 2023 will mark a rates revaluation for business properties in England and Wales,
based on values on 1 April 2021. A range of measures were announced to ease the impact
of this revaluation, including:

• A freeze on the business rates multipliers in 2023/24 at 49.9pand 51.2p.
• A transitional relief scheme, capping bill increases caused by changes in rateable
values, funded by the government rather than, as in the past, limiting decreases.
• 75% business rates relief for eligible retail, hospitality and leisure businesses, up to
£110,000 per business in 2023/24.

Raymond James Budget Newsletter November 2022 15