Small businesses and self-employed hit hardest by the budget

An increase to the national insurance contributions (NICs) paid by the self-employed and small business owners, as well as higher taxes on dividends meant Philip Hammond's first budget made for tough listening for SMEs in Northern Ireland and the rest of the UK.

The Class 4 NICS payable by the self-employed will increase from 9 percent to 10 per cent next year, and will increase again to 11 per cent in 2019. The Chancellor said the changes were aimed at bridging the gap between the amount of insurance paid by regular employees and the self-employed. The Chancellor also announced that the tax allowances on dividends for company shareholders would be reduced from £5,000 to £2,000 - a further strike at the income of business owners in Northern Ireland and the rest of the UK.

The changes seem very much to have come about as a reaction to the surge in reports of workers being forced into self-employment by their employers, but many have argued that the government should have been going after the employers, and not punishing those being pushed into self-employment. There have already been concerns that the changes will deter many people from going out on their own, and may push many struggling businesses to the wall.

If you are a small business owner requiring legal advice in respect of a commercial law matter in Northern Ireland, contact Wilson Nesbitt in Belfast by clicking here.

If you require advice in respect of a tax matter, including self assessment and income tax, contact Wilson Nesbitt by clicking here.

News Categories