1st April 2023 saw the end of a single corporation tax rate and the introduction of a new main rate of 25% for companies with taxable profits of more than £250,000.
For those who have taxable profits of £50,000 or less, the 19% Corporation tax rate will remain.
And for those businesses with profits between £50,000 and £250,000, they are faced with the rate increasing incrementally from 19% to 25% depending on how much profit a company makes.
Overall, it is more important than ever that companies now plan ahead for estimated tax liabilities.
Being proactive and taking advantage of various measures and reliefs available will offset some of the additional costs associated with the higher tax rate.
National Living Wage
As of 1st April 2023, the National Living Wage in the UK was raised to £10.42 per hour for those aged 25 and over.
This is a significant boost from the previous rate of £9.50 per hour and marks an important milestone in providing better pay and security to low-paid workers nationwide.
The National Living Wage is a minimum rate of pay set by the government.
It guarantees that those who are aged 25 and over will receive at least £10.42 per hour regardless of their occupation or workplace.
This rise in the living wage is undoubtedly welcome news to millions of people across the country, but business owners need to be aware of how this will impact their business as there wasn’t a corresponding increase to employer National insurance and pensions contribution thresholds.
In the know
It is essential for businesses to stay informed and prepared for the changes in corporation tax, national living wage and other measures being introduced.
Knowing all the details of these reforms will allow businesses to remain competitive and make the most of them for long-term success.
Taking proactive steps now can help you to avoid any potential penalties or problems down the line.
The new taxation and wage regimes can be daunting, but businesses should remain positive.
By consulting with experts and taking an informed approach to the changes, companies can ensure that they are able to adapt and thrive in the shifting environment successfully.
With the right preparation, these reforms can open up new possibilities for business growth and success.