Budget 2011 Summary

The Budget - 23rd March 2011 - Summary.

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Summary: Budget for Growth - "START UP BRITAIN …"

Growth Forecast revised down to 1.74% from 2.1% --- next year 2.5%, then 2.9% for 2013 and 2.8% 2014

Inflation 4-5% this year, then next year 2.2% and 2% by 2013, quantitative easing is to remain

National debt as % GDP up to 60% of GDP this year, up to 74% next year.  £146bn this year but down to £29bn 2015/16.

Rest of Country must be brought into being growth areas …not just the City and financial services but around the country for manufacturing etc

Abolished 43 complex tax reliefs - removes 100 pages from tax rulebook

All Direct Taxes increases and allowances to be linked to Consumer Prices Index

National Insurance and Income Tax - Consultation to merge taxes

Reform Controlled Foreign Companies (CFC) rules

Corporation Tax - April 2011 - reduced by 2% and not 1% and will continue to fall 1% each year for next three years to 23%

Bank Levy will be increased next year to pay for corporation tax cuts

No win - No fee Services for sueing of business to be scrutinised and policed

New Business Startup and Smaller Companies - April 2011 - new start ups and below 10 employees exempt from 3 years from red tape.  £350m of business regs scrapped

Enterprise Investment Scheme tax relief increase from 20% to 30% and will double EIS allowance and increase access to Venture Capital Trusts

Enterprenuers Relief doubling to £10m

Non-Domiciles Tax Increase – Current £30,000 Charge if lived UK for 7 years, increasing tax bill to £50000 for non doms if lived in UK for over 12 years ….  However, remittance will not be included if bring in funds to invest in UK business

50% Income Tax Rate ….  Is a temporary measure …confirmed HMRC to investigating how much it brings in as to whether it will be removed in the future

ZERO Rates for Small Business to be extended until October 2012

£250m First Time Buyers Shared Equity Scheme - Bank levy will also fund  … New Builds for 10,000 families, shared equity

Small Companies research and development tax credit will double in April

21 New Enterprise Zones for Business ….  Across Midlands and North.  Another 10 Enterprise Zones will be announced in the summer

Changes to Company Car Tax … to incentivise greener cars

40,000 new apprenticeships to help school leavers

State Pension Age linked to Longevity ….  age 66 yrs at 2020 and will be automatically regularly reviewed to increase further based upon life expectancy and costs

State pension to be flat rate ….  Estimated at £140pwk … not apply to current pensioners

Simplifying Gift Aid for Charities … by 2013 … an online system and bulk claims rather than proving each individual claim ...  Gift Aid up £5000 do not have to prove

Inheritance Tax -  If 10% of estate or more is gifted to charity then Government will reduce tax rate by 10% i.e.  from 40% to 36% ….

Tax Avoidance loopholes to be closed … e.g.  Channel Islands media distribution companies etc

Public Sector Workers earning less than £21,000 will receive a pay rise whilst rest are still frozen

Personal Allowance Going Up Again April 2012 Next Year by another £630 from £7,475 to £8,105

Delay in Air Passenger duty rise  …but a new private jets tax to be introduced

Approved Mileage Allowance Scheme up from 40p per mile up to 45p

Fuel Duty….  Would have been adding another 5p a litre if not touch but introducing a Fair Fuel Stabiliser  tax on Oil Company Profits which will raise an extra tax revenue £2bn a year on oil companies ….  instead of a 4-5p rise, fuel duty is cut bt by 1p per litre with effect 6pm tonight.

More to follow in the Budget News Home

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