Looking forward to 2022 and incentives for growth

  Posted by: Dental Design      4th January 2022

As a dental practice owner, what is your plan for 2022/23 looking like? Last October’s Budget was intended to instill a sense of confidence for the year ahead, with the Chancellor announcing, “the biggest single year tax cut to business rates in over 30 years”. Not all of these measures, both new and confirmed, will apply to you, of course, and how realistic is this climate of optimism that the government is trying to create? Figures published in November revealed that inflation had risen to its highest rate in the UK for almost 10 years; we’re hearing plenty about the reasons why, including issues outside of anyone’s control such as the worldwide surge in energy prices and a shortage of some goods causing supply chain issues.

But positivity as well as pragmatism are the hallmarks of every successful business. You may have been fortunate enough to have bounced back relatively quickly from the impact of the pandemic, certain treatments have seen an unprecedented level of demand, for example. Perhaps recruitment is in your future, or improvements to the building to modernise it and/or expand.

With regards to the latter, starting in 2023, there will be a 12-month relief for business rates arising from improvements made, to incentivise companies to invest in their premises. This will provide 100% relief from any additional rates charges, where a property’s rateable value has been increased. Caution is advised, though, as not all works will impact on rateable value. Valuation of non-domestic property is a complex process and you must do as much homework as you can; there is a wealth of guidance on the government’s website.

Something else that could benefit dental practice owners is the freezing of business rates multipliers for a second year, until 2023. Transitional relief for small and medium-sized businesses and the supporting small business scheme will also be extended for another year. Also starting from 2023, revaluations will take place every three years instead of five.

The £1 million level of the Annual Investment Allowance (AIA) is to be extended, to 31 March 2023, also taking effect are changes to research and development (R&D) tax reliefs, along with other measures including those that support domestic innovation. There are ‘green’ incentives for investment too; eligible low-carbon heating will benefit from a 100% relief, for example. Again, check terms and eligibility.

These kinds of measures are intended to alleviate the burden of busines rates, giving companies the space to do things like expand their team. Creating jobs is one of the main ways that shows you are thriving, but you may be concerned about the impending 1.25% rise in national insurance contributions. For employers, on amounts above £8,840 paid to an employer each year, it will cost them 15.05% in NICs, up from the current rate of 13.8%.

To keep the momentum going, and plan ahead in a way that encourages growth while giving you flexibility in the face of circumstances that are out of your control, enlist the services of specialist dental accountants such as the team at Figurit. Combining knowledge of the principles of accounting, with insight into the dental industry, we can help you optimise your finances and stay focused.

Business owners would have welcomed a series of measures, announced in the October Budget, to alleviate the burden of busines rates. But there are, as ever, rules and exemptions will apply so although the government is going all-out to encourage investment, caution is recommended. But with a careful, organised approach, the sky could be the limit in 2022 and beyond.

For more information, please visit https://figurit.com
or call Figurit (formerly known as Lansdell & Rose) on 020 7376 9333.