United Kingdom Announces New Government Aid Program
UK Government launches Investment Zones for businesses
To drive job creation and stimulate economies, the United Kingdom Government announced several new initiatives and tax cuts, headlined by the creation of Investment Zones. Outlined in the government’s Growth Plan 2022, the strategic approach will target communities across the country leveraging new tax cuts for both individuals and companies in order to stimulate economic growth.
For companies, highlights of the announcements include:
Six-month Energy Bill Relief Scheme will providing a discount on wholesale gas and electricity prices to support business in Great Britain with rising energy prices over the winter months
Streamlined Planning System for infrastructure projects
Maintenance of the Annual Investment Allowance tax relief at £1 million for, which was due to expire in March 2023
New Investment Zones will provide time-limited tax reliefs, and planning liberalization to support employment and investment (see below)
Reducing the National Insurance Contribution by 1.25% from November.
Investment Zones
As part of Growth Plan 2022, the UK Government is currently in talks with 38 local authorities across England, in partnership with Upper Tier Local Authorities and Mayoral Combined Authorities, about the creation of new Investment Zones to encourage growth and investment in the regions.
Discussions have also commenced to explore establishment of Investment Zones with the Devolved Administrations and local partners of Scotland, Wales, and Northern Ireland, particularly to align with recent initiatives including the Freeports programme.
Companies investing in these zones can expect a range of potential tax benefits over a 10-year period, including:
Reduced Business Rates – 100% relief from business rates on newly-occupied business premises (and certain existing businesses) where they expand in English Investment Zone tax sites.
Enhanced Capital Allowance – 100% first year allowance for qualifying expenditure on plant and machinery within the zones.
Enhanced Structures and Buildings Allowance – accelerated relief to allow businesses to reduce their taxable profits by 20% of the cost of qualifying non-residential investment per year, relieving 100% of their cost of investment over five years.
Relief on Employer National Insurance Contributions – zero-rate Employer NICs on salaries of any new employee working in the tax site for at least 60% of their time, on earnings up to £50,270 per year.
Stamp Duty Land Tax Relief – 100% relief on Stamp Duty for land and buildings bought for use or development for commercial purposes, and for purchases of land or buildings for new residential development.
To begin exploring how your business may be able to secure and leverage these programs and new funding opportunities, connect with the experts on the Hickey Incentives Team today!
Prospective Investment Zones
1. Blackpool Council
2. Bedford Borough Council
3. Central Bedfordshire Council
4. Cheshire West and Chester Council
5. Cornwall Council
6. Cumbria County Council
7. Derbyshire County Council
8. Dorset Council
9. East Riding of Yorkshire Council
10. Essex County Council
11. Greater London Authority
12. Gloucestershire County Council
13. Greater Manchester Combined Authority
14. Hull City Council
15. Kent County Council
16. Lancashire County Council
17. Leicestershire County Council
18. Liverpool City Region
19. North East Lincolnshire Council
20. North Lincolnshire Council
21. Norfolk County Council
22. North of Tyne Combined Authority
23. North Yorkshire County Council
24. Nottinghamshire County Council
25. Plymouth City Council
26. Somerset County Council
27. Southampton City Council
28. Southend-on-Sea City Council
29. Staffordshire County Council
30. Stoke-on-Trent City Council
31. Suffolk County Council
32. Sunderland City Council
33. South Yorkshire Combined Authority
34. Tees Valley Combined Authority
35. Warwickshire County Council
36. West of England Combined Authority
37. West Midlands Combined Authority
38. West Yorkshire Combined Authority
If you would like to learn more regarding the recent announcement from the UK Government and to see if your business may be eligible, please sign up to receive future updates: