Help for business
The only real changes that the Chancellor announced for OMB businesses are:
- Corporation Tax to be cut by 1% to 20% in 2015.
- Employment allowance will cut employers NI bills by £2,000.
- Increase in tax free loans to employees.
- Cancellation of the planned fuel duty increase.
However, overall there seems to be very little help for most UK OMB’s in this years Budget.
The Chancellor has offered some help to the construction industry by introducing his ‘Help to Buy’ Scheme which will provide £3.5bn for interest free loans to people buying new build homes. In addition, he also announced provision of £130bn of Government Guaranteed Mortgages targeted at people who can afford the mortgage but are unable to fund a full deposit.
Whether the Government ‘standing in the shoes’ of lenders to make loans that lenders have considered too risky is a good idea, remains to be seen.
The personal allowance is going to be increased to £10,000 with effect from April 2014.
An increase to £9,440 for 2013/14 had already been announced. However, in order to make sure that higher rate taxpayers do not benefit, the income level at which 40% tax is paid will be reduced by £1,000 to £41,450.
Anti avoidance measures
There are proposed anti avoidance measures for loans to directors and shareholders from their companies. Detailed provisions are not available yet.
Higher rate tax
Despite the Chancellor maintaining that lowering the tax rate for the wealthy leads to the wealthy paying more tax, he did not announce any further reduction in respect of the top rate of tax. I am sure that this will disappoint many business owners.
Given that the Chancellor did not have much room to manoeuvre; do you think there was anything more he could have done?