Why should your business invest in technology following the mini budget?

Last week, the new Chancellor of the Exchequer revealed his short-term plans for the country’s finances via a reduced mini budget which outlined how the government was going to tackle the UK energy crisis, inflation as well as the high cost of living and what they planned to do to help businesses. 

In our latest blog article, we will go through the most relevant announcements and what it means for your business and why you should be taking steps to invest in technology. 

Capital Investment 

With regards to capital investment, it was announced that when businesses invest in qualifying capital assets, capital allowances are on hand to help give tax relief to the expenditure outlined. Furthermore, incentivising investment in the UK economy is one of the key points made by the new Chancellor, it doesn’t come as a surprise to see that the 100% tax relief of up to £1 million per year for spending on plant and machinery as well as integral features under the Annual Investment Allowance (AIA) is likely to be a permanent fixture going forwards. This is a contrast to the cut that was originally proposed to £200,000 as of next April. With the fluctuation in the AIA limit over the years, with temporary increases to help stimulate investment in the economy, it is surely a positive sign to see tax relief staying at a stable rate. 

Despite the above, one of the most interesting parts of the capital investment announcement was the application of the current Super Deduction Tax Relief. This is nothing new as it had been previously brought into place by the previous Chancellor Rishi Sunak in April of last year, it gives more tax relief to the tune of 130% on unlimited qualifying spend, meaning that businesses are given 25p of tax relief for every £1 of qualifying spending. This scheme is likely to end by next April, and it had been expected that the proposed increase in the tax rate to 25% would give the same amount of tax relief going into the future. 

As well as the above, following the Chancellor’s mini budget, it has been confirmed that there will be some changes around the technical provisions for the Super Deduction due to the Corporation Tax staying at 19% to make sure that the relief continues to be used as intended.  

What does the capital investment announcement mean for my business? 

Even though the full changes haven’t been published as of yet, the above does seem to suggest a real incentive for businesses that are looking to accelerate any capital expenditure over the course of the next 6 months to maximise the tax relief on capital expenditure. 

This means that now maybe the time to fast track a move to a new ERP or CRM system with Advantage to make sure you can not only futureproof your business but also get the latest technology for your business that can easily be scaled up as your business grows. 

Investment Zones 

It was also announced in the mini budget announcement from the Chancellor that up to 40 locations around the UK, including some along the South Coast and the Thames Estuary are being highlighted as new investment zones, where lower taxes and planning restrictions will be available for businesses. 

What does the investment zones announcement mean for my business? 

It doesn’t come as a surprise from the above but what this means is that investing in technology such as a CRM or ERP system with Advantage can be beneficial if you operate in the above areas which could be game changing and have you leading the competition and help to futureproof your business. 

Next Steps? 

If you are a business that is looking to take advantage of the above announcements from the Chancellor’s mini budget by investing in either a Microsoft CRM or Microsoft ERP system through one of our Quick Start offerings or looking to automate more of your business processes through the Microsoft Power Platform then please give our team of Microsoft experts a call today to discuss your requirements in more detail. 

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