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George Osborne presented his Budget on Wednesday 20 March 2013.
In his opening statement he set the scene for some of the new measures announced, stating 'this is a Budget for people who aspire to work hard and get on'.
Towards the end of last year the Government issued the majority of the clauses, in draft, of Finance Bill 2013 together with updates on consultations. The publication of the draft Finance Bill clauses is now an established way in which tax policy is developed, communicated and legislated.
The Budget updates some of these previous announcements and also proposes further measures. Some of these changes apply from April 2013 and some take effect at a later date, so the timing needs to be carefully considered.
Our summary focuses on the issues likely to affect you, your family and your business. To help you decipher what was said we have included our own comments. If you have any questions please do not hesitate to contact us for advice.
Main Budget tax proposals
- Date set for increase in the personal allowance to £10,000.
- New scheme for tax free childcare.
- Further reduction in the main rate of corporation tax to 20% from 1 April 2015.
- Employee-shareholder contracts will be exempt from income tax and NIC for the first £2,000 of shares received.
- The introduction of an allowance of £2,000 per year for all businesses and charities to be offset against their employer Class 1 NIC liability from April 2014.
- A capital gains tax re-investment relief for gains made in the tax year 2013/14 where the gain is invested in Seed Enterprise Investment Scheme shares.
Significant non-tax measures have been announced to tackle long-term problems in the housing market and are covered in the Other Matters section of this summary.
Previous announcements
Some of the changes detailed in this summary have been the subject of earlier announcements. Here is a reminder of some of the more important ones:
- personal allowance substantially increased for 2013/14
- restrictions in the higher age related personal allowances and their availability
- an increase in the Annual Investment Allowance limit from £25,000 to £250,000
- introduction of a cash basis for reporting profit for the smaller unincorporated business.
Download the 2013 Budget Summary
Our handy UK tax app gives you quick and easy access to key UK tax information. With the latest rates and dates derived from the 2013 Budget, you will have your own hub of tax knowledge while you are on the move.
To download our iPhone app, type ‘UK tax hub’ into your App Store.
Research into the income tax paid by city/town lists the top 100 by mean tax and total tax paid, and shows that residents of Esher, Weybridge and Walton on Thames in Surrey, pay the highest average income tax bills in the UK, paying an average of £16,100 in tax per year, £11,702 higher than the UK average of £4,398.
The number of businesses that have requested a National Insurance Contribution holiday plummeted to a new low of 400 in December 2012, down 44% from the 710 applications made in the same month the year before. This is the lowest take up of the scheme since January 2011 – just after the scheme launched – and less than a fifth of the 2,235 applications received at the scheme’s peak in October 2011.
The value of mergers and acquisitions targeting private companies has increased 50% in one year, up by £6.1 billion to £18.2 billion.
Businesses are losing out as HMRC’s internal VAT decision review process appears to be making decisions increasingly in HMRC’s favour,
George Osborne presented his Budget on Wednesday 20 March 2013 and there were few surprises. Amongst the detail there were some announcements which affect the charity and not-for-profit sector, and these have generally been warmly received by sector leaders.
Our Sittingbourne rural and agriculture specialists will be exhibiting at Kent AgriExpo on Wednesday 6 March.
Dundee and Aberdeen saw the UK’s biggest booms in household disposable income – the money a household has left to spend or save after taxes and mortgages or rent – over the last five years, according to our latest research.
