Budget 2009: Small businesses and sole tradersIncreased capital allowances to encourage spending

22 April 2009

Chancellor of the Exchequer Alistair Darling today announced help for cash-strapped small businesses in his 2009 Budget

Helping cashflow for business through loss carryback

The Budget

Loss-making small businesses will be able to reclaim tax paid in the previous 3 years, rather than carrying excess losses forward for offset against future profits.

This measure will be available until November 2010 and will help traders suffering from cashflow problems during the recession.

Capital allowances increased to 40%

To encourage spending on buildings and equipment, the rate of capital allowances available to businesses will be increased temporarily from 20% to 40%. 

This move will allow a higher proportion of private investment to be offset in that year against taxable profits, encouraging businesses to bring forward planned investment.

The increased capital allowances are only available for one year, with effect from April 2009.

Personal budget calculator

To see what effect the Budget will have on your own finances, try out our Budget 2009 calculator.

Latest money news

For daily consumer news, subscribe to the here.

If you have an older web browser you may need to copy and paste this link into your newsreader: http://www.which.co.uk/feeds/reviews/news.xml . Find out more about RSS in the Which? guide to news feeds.

Or listen to our weekly .