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Business Benefits of enterprise zones

At the beginning of April the government announced the addition of 12 new Enterprise Zones here in the UK, bringing the total number to 48.  Enterprise Zones were initially set up in 2015 in a bid to help new businesses to get up and running or to help established businesses to grow by offering business rates discounts, tax breaks and a simplified planning process.  The UK economy depends heavily on SMEs which account for 99.9% of all private business in Britain and the government is committed to create the right type of environment for businesses to flourish, rather than to fail and lead to business owners going into debt or insolvency.  Today we’re going to take a closer look at Enterprise Zones and the benefits they offer business owners here in the UK.

Each of the Enterprise Zones offers start-ups and business owners a package of financial incentives to encourage them to establish in that particular area.  Businesses from the same sector are often co-located within the Zones for their mutual benefit which makes networking easier than ever. 

All of the Enterprise Zones in the UK offer discounts on the amount that must be paid to the local authority for essential services (business rates) in the shape of the Business Rates Relief Scheme.  In some cases, the Scheme will cover up to 100% of these costs (to a maximum of £275,000 over five years). Which is a pretty powerful incentive, especially for start-ups that are bootstrapping their business from scratch.

Some of the Enterprise Zones provide additional financial expenses to start-ups and businesses to launch in that particular area.  For example, companies that invest heavily in new machinery and plant may be able to write off all of the equipment costs against profits in the year in which they purchase the equipment.  This is the “Enhanced Capital Allowances” programme which can have a value of up to £100 million. 

The UK’s Enterprise Zones make construction projects easier too because they enable a simplified planning process.  Specific details vary from Zone to Zone but there are areas where those planning to build new offices, factories or other premises may be exempt from the usual planning process which is an encouraging development for many business owners looking to relocate or for start-ups needing to build a workshop or factory.

The Enterprise Zones are an integral part of the government’s Plan for Britain and Industrial Strategy which aim to create a stronger economy as we prepare to leave the European Union.  The Plan for Britain should hopefully ensure that the UK is in a strong position when trading beyond Europe in the coming years and take its place on the world stage in terms of business.  It’s hoped that the UK will be an outward looking nation that develops new partnerships across the globe while continuing to meet its commitment to support developing nations and shape decisions on the world stage.