Rishi Sunak released the Spring Statement earlier this week. Here is a summary of the key points. Fuel Duty cut Cutting fuel duty on petrol and diesel by 5p per litre for 12 months. The cut takes effect from 6pm on 23rd March 2022. Employment Allowance increase The Employment Allowance is a relief which allows eligible businesses to reduce their employer National Insurance contributions (NICs) bills each year. From April 2022 the Employment Allowance will increase from £4,000 to £5,000. Reforming Research & Development credits From April 2023, businesses will be able to claim Research & Development tax relief on the storage of their vital data and pure maths research. Draft legislation will be published this summer with a review to try to improve the Research & Development incentives. Greater Business Investment There will be a series of potential policy changes to the UK’s existing capital allowances regime, which the government will consider ahead of April 2023. The aim i...

It is often tax-efficient to trade as a limited company as opposed to a sole trader or partnership. This is because the tax rates on dividends and profit tends to be lower compared to national insurance and PAYE. A lot of people choose to trade as a limited company where they own a share of the limited company, i.e. be a shareholder* and they would be the director** of the limited company. This article is going to explore effective ways of paying a shareholder and director from a limited company. 1. Salary - The most common and obvious route is to pay yourself a salary. This is when you are employed by the limited company. Being employed by the limited company means you will have to set up a PAYE scheme so you can then produce periodic payslips, usually processed monthly. For the 22/23 tax year the tax efficient salary for a one director company is £758 per month (see other article link). By running this salary through the payroll, you will not pay any national insurance and you will r...