Budget 2012 Round-up
By John Hughes, Tax Partner (pictured)
This year's Budget
targeted three main areas: a stable economy; a fairer, more efficient and simpler tax system; and reforms to support growth. With little room for manoeuvre the Chancellor delivered a fiscally neutral Budget, reducing taxes for lower earners, while increasing taxes in other areas.
Economic and fiscal update
The backdrop to this year's Budget is important and demonstrates the need for prudent planning. The Budget saw some moves in the right direction, but the fact remains that growth will be sluggish as the economy stabilises.
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For businesses
The Budget 2012 was designed to prove that the UK "unashamedly backs business". A key proposal saw Corporation Tax cut to 24% this year, but other announcements included research and development changes and plans for the simplification of tax for small businesses.
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For your finances
In a Budget which pledged to lift the lowest paid out of tax and to continue to tax higher earners, the Chancellor will accelerate the increase of the Income Tax threshold, introduce Income Tax on child benefit for larger incomes and restrict the age-related personal allowance.
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VAT and indirect taxes
After warnings earlier this week, Stamp Duty Land Tax on property valued over £2 million is to be raised from 5% to 7%, while at the other end of the scale, tobacco duty will increase by 5% above inflation.
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Other announcements
Tax avoidance came under the spotlight again in this Budget, with the announcement of General Anti-abuse Rules (GAAR) and other smaller avoidance measures. There will also be alterations to carbon price floor regulations and Gift Aid concessions.
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Tax rates and allowances 2012/13
These tables show the latest tax rates and allowances that will come into effect on 06 April 2012.
Click here to view tables
To access our full report on all of the changes, click here.
If you would like to know more about any of the Chancellor’s proposals and how they may affect you or your business, please give me a call on 01483 205850.
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