It’s been hailed a Budget for small business and the devil may be in the detail but early reactions to Budget 2016 are positive for Britain’s commercial landlords and businesses.
Highlights from Chancellor George Osborne’s March Budget are a cut in business rates and changes to commercial property stamp duty.
Boxpod MD Nick Marlow has been championing an overhaul of the unfair business rates system.
Following the Budget announcement, he said: “This is great news for business and for Boxpod, its advertisers and enquirers.”
Here are the commercial property highlights from the Budget:
Cutting business rates for all rate payers
From April 2017, small businesses that occupy property with a rateable value of £12,000 or less will pay no business rates.
Currently, this 100% relief is available if you’re a business that occupies a property (e.g. a shop or office) with a value of £6,000 or less.
There will be a tapered rate of relief on properties worth up to £15,000. This means that 600,000 businesses will pay no rates.
New stamp duty rates for commercial property from 17 March 2016
The way stamp duty on freehold commercial property and leasehold premium transactions is calculated will change. Currently, these rates apply to the whole transaction value. From 17 March 2016 the rates will apply to the value of the property over each tax band.
The new rates and tax bands will be 0% for the portion of the transaction value up to £150,000; 2% between £150,001 and £250,000, and 5% above £250,000.
Buyers of commercial property worth up to £1.05 million will pay less in stamp duty.
Stamp duty rates for leasehold rent transactions will also change, with a new 2% stamp duty rate on leases with a net present value over £5 million.
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