Greetings!
Overall the Budget is likely to get a mixed response from Businesses, with some winners and inevitably a number of losers. However, the budget announcement was a good example of "expectation management", since many people were left thinking "well, it could have been worse!" -
Some of the key points:An increase in the Annual Allowance of £1,000 brings the threshold to £7,475, which means a tax saving of £300 for everyone! Not a bad gift. This will take affect from April next year. -
Child Benefit to be frozen for the next three years. This hits poorer families hardest, but I think the chancellor was sending a clear signal that Britain must rid itself of "benefit culture". -
VAT to increase to 20% from 4 Jan 2011. This means negative impact on all DNS clients who account for VAT out of takings like Educational institutions and Retail Business. -
Government Contributions to the Child Trust Fund to be reduced and eventually stopped. This will affect children from poorer families the most, but to alleviate possible hardship for less well of children, the government has set up a £2bn fund for their education. - Corporation Tax to be cut by 1% for the next four years. This will reduce it in the long term to 24% for large companies and 20% for small companies.
- Capital Gains Tax increased from 18% to 28% % with immediate effect.
- Annual Investment Allowances to be reduced from £100,000 to £25,000.
- Small Business to get NIC relief of up to £5000 if they set up business outside London , South east and East of England. Why wait if you want to start a new venture. I think one of the best incentives offered to fill the gap of regional imbalance in terms of growth development and business.
Not so bad after all. Great news at the of DNS is none of the tax planning are affected so we can continue to save taxes using our simple and complex strategies where possible. If you want to discuss your personal situation on any particular issue then please do not hesitate to contact your portoflio manager.
Have a lovely evening. |
